Demo Day Traps (and how to avoid them)
A little known fact about the end of the year is that there tends to be a lot of demo days and/or pitch competitions to help send off a new cohort of founders before the holidays.
But, even though of these pitch events get (rightfully) framed as celebrations, a number of judges and investors walk away from the event feeling underwhelmed by the quality of pitches because along the way founders lost sight of the key elements of what makes a good pitch.
In the past few weeks, I’ve been lucky enough to both be a judge and observe a few pitch events and speak with a number of people in similar positions who’ve come away with a similar impression. And so (with deep admiration and respect for founders)….here is the list of my “Common Pitch Event Traps” that I saw in 2022 and how to avoid them:
1) Takes too long to say what you’ve built
I’ve said this in another post before but it bears repeating: Investors don’t remember problems - they remember insights. I’m amazed at how founders utilize the beginning of their pitch, arguably the time when they have people’s attention the most, to go into extensive depth covering the ins/outs of the problem they’re trying to solve. A Pitch is not a “show your work” moment like you might have done in school - it is the chance to introduce, succinctly, what is your insight into a problem and what you’ve built to test it.
Investors are more impressed by builders than homework doers.
Solution: Spend no more than 1 minute describing your problem. And make sure the solution part of your pitch is roughly 4-5x longer than your problem.
2) Has no idea how to introduce the team
This is perhaps the most controversial part of this article because most investors have very specific expectations when it comes to the team. And the bad investors/judges will sometimes even penalize you for not putting your team description in the spot where they might expect it. But if you talk to founders they'll tell you that a team slide in a Pitch Event feels like a founder is checking a box with a slide with logos/photos. Thus, founders are left with little direction on how to talk about their team in a way that primarily serves the pitch narrative.
Solution: Introduce your team early in your pitch under the context of "how did you discover this problem" and "how did you derive your insight". Even better, introduce whomever built your solution when you're describing what you built. Give your story characters, not a lip-service slide.
3) Fails to demonstrate speed
More often than not these pitch events are coming at the end of an accelerator program or bootcamp. You may not necessarily have evidence of customer traction, but an investor is going to need to see that you're capable of moving quickly and working at a speed different than you wouldn't as a professional in a larger organization.
Solution: Make speed a huge part of the narrative. Answer questions like "what was accelerated as part of this program?" or even "what is changing that's causing you to move quickly now". Urgency can be the most convincing part of a pitch. Show that you're capable of executing with urgency.
4) Avoids Go To Market strategy entirely and doesn't speak to how they will make money
By definition a GTM strategy is incredibly nuanced, requiring a deep understanding of sales channels, sales cycle, and customer demographics (among other things). But just because a Pitch Event requires a short presentation does not mean you can ignore answering the key question: "How are you going to make money?" It may sound crazy, but I cannot tell you how many pitches I hear (and how many judges I hear complain afterward) where they don't know how you are planning on making money. If you're a founder though, it's easy to understand why you might dodge the complicated summary, although I promise you, it doesn't go unnoticed.
Solution: You must have some description for how you're planning on making money. No investor is going to penalize you for having a sales strategy, because they know that almost every single company will change their business model plenty of times. But you need to show something. If you don't, most investors will write off your pitch immediately.
5) Avoids a demo/visual/audio representation of the product -
I can't tell you the number of pitches that I've heard where the founder doesn't actually show the product in action. I actually made this mistake as a founder - where my cofounder and I reached the second VC meeting when they finally asked us "hey can I see what you've built?" before I even realized we had never actually shown them. As founders we can get lost in the reality that when we're pitching, we're talking to people who most likely know nothing about us. And yet, there are loads of founders who talk about everything without actually showing it work.
Solution: Prioritize answering "What" above all questions. If someone is coming to a pitch competition to learn about what you do, show them. Nothing is more powerful than a demo even if it's a prototype. Which leads us to....
6) Pretends that they have it all figured out -
There is a HUGE difference between being polished and also pretending that you have it all figured out as a founder. And judges/observers can sniff out when your being confident in what you know and when you are covering for the fact that you truly have no idea what you are doing. Good founders are aware that they need to be both confident and curious; open to new ideas while also having just the right amount of delusion to believe that the world needs what they are building. Don't pretend that you know everything as a way of hiding your work-in-progress nature.
Solution: Do provide evidence of organizational growth/evolution while also tying that shift back to your convictions as a founder. I've often talked to founders about the different kinds of traction that an investor looks for in a startup. We might expect that traction only covers customer growth, but actually traction can look like everything from how you've learned (and pivoted) to how quickly you build, test, and receive customer feedback. Traction is proof that you're capable of dealing with change at the speed necessary for startups. The speed by which your team learns is more indicative of that entrepreneurial hustle than anything else. If you pretend you know everything there is to know about your market opportunity, it tells an investor that you're not learning.
Look, it is incredibly hard to be a founder. The delicate and borderline sacred nature of believing that the world deserves what your brain has invented is not something that I nor anyone in a place to judge your pitch should ever take for granted.
That being said I remain ever hopeful that founders can take a step back and see not only the traps that are easy to fall into during a pitch event, but also how to avoid them. It is equally special when people take the time out of their days to learn about how you as a founder have chosen to dedicate your life to solving a problem, so let's make it as easy as possible to share your story, keep them engaged, and show them all the evidence needed for them to want to root you along at every step of the way.
