VC Minute – quick advice to help startup founders fundraise better.
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A common storytelling mistake. I see this all the time is how founders pitch after a pivot.
Founders that are pivoting or emerging from a pivot, tend to go into great detail about what they tried, what didn’t work, and how they pivoted. They walk you through the story chronologically.
Investors are going to look at your pitch through the frame that you set for them. When you start your story by framing it in the past, investors will get stuck on that frame of reference. When the big reveal of the pivot comes, the investor has to completely shift mindsets to get out of what the business isn’t, and into what the business is now.
I’ll give you an example. I was working with a founder who had an incredible B2C nutrition business that was 100% bootstrapped to nearly $20 million in lifetime sales.
But when Apple changed their ad targeting policy, it broke their customer acquisition. She pivoted to B2B sales, and she already had traction there; and was going out to raise venture capital based off of the B2B business.
The story started with B2C traction and then flipped to B2B, and everything got muddled. I was not the only one to give her the feedback that I spent the first half of the pitch thinking about it as a B2C nutrition app.
A simple change to tell the story of the B2B business and how that’s growing will set the stage. And then use the B2C side as your proof point that the product works and people will use it.
Whatever your pivot is, start with what the business is now and then use the past as your supporting cast of characters to prop up the story of why your business is what it is. Not all stories need to be told chronologically. Ever seen Momento?
Put the focus on what the business is and the vision for its future. Use the past and the pivot to support that story.
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