Start-Up Launchpad Blog

Tips for Pitching to Investors, Venture Capitalists and Incubators - October 25, 2011

Emily E. Harris, Patent Attorney

Recently, I have had the opportunity to participate in several panels where startups have pitched their businesses, including the Technology Association of Iowa's Pitch and Grow and also VentureNet. The Pitch and Grow events are designed to help startups hone their pitch through interaction with panelists who are CEOs, CIOs, business development experts, industry professionals and attorneys. VentureNet has been retained by the Iowa Department of Economic Development to have expert panels review applications for the Demonstration Fund.

 

Having participated in several of these events over the last few months, I thought it might be helpful to provide some tips on what investors, venture capitalists and incubators are looking for in your pitch. Also, check out Mike Colwell's blog post about what should go into your "15 second intro".

As a general rule, it is best to tell a compelling story. Through the story, tell (1) what problem your business/product is trying to solve, (2) how your business solves that problem, and (3) why your solution is better than the competition. While it is important to convey what your business or product does, a detailed description of the minute details of your business, whether it's describing the coding process for a software application or detailing the experiments you used to prove your theory works, does not make for a particularly good pitch. In other words, don't describe what your product/service is; instead, convey why someone should care about what it is.

 

One aspect of the pitch that I rarely see and I believe should be an integral part of every pitch is a description of your company's intellectual property ("IP") and (briefly) the steps you have taken to secure it. Your business assets (i.e., the value of your company) likely lie almost exclusively in intellectual property. IP often underpins your idea, your product, your services and your brand. When you are giving a sales pitch for your business, it is imperative that you convey the areas where your company derives its value and it is likely that your company derives much of its value from IP. 

Therefore, a brief description of your company's IP during your pitch is warranted. Including a summary of the IP will make your pitch stand out from most others because most companies don't incorporate IP into their sales pitch.

 

It's important to remember that intellectual property does not necessarily equal patents. Virtually every company has intellectual property: it exists in your name, your business plan, your software, your customer lists, your website and even in your use of blogs and social media.

 

Items that are important to include in your pitch are:

  • Whether you have filed any patent applications or have any issued patents
  • Whether you have protected your name or brand with federal trademark registrations (and if you have received the registration, use the ® designation on your slides to show that you have it and you properly know how to use it)
  • If your company depends upon proprietary, trade secret information (such as ways you plan to target customers or the software that you have built your business on), convey that you have proprietary information and why you will be able to maintain its confidentiality
  • If your business relies on licensing out your technology (such as software), a brief description of the structure of your licensing arrangement (exclusive, non-exclusive, royalty or other revenue stream)

Determining what IP your company has may not be an easy task and it may make sense to contact an intellectual property attorney to assist with identifying your company's assets. We provide a free IP Audit Checklist (sign up for free to be a client) to help clients determine what aspects of their business may be intellectual property assets. Or catch us during our frequent Start-Up Launchpad Office Hours, and we can also review your business plan to help you identify your IP at no charge.