After going through the previous steps from Stages 1,2, and 3, it is important to communicate the value and positioning of your business to the outside world in a manner that is easily understandable and impactful. This step is about helping you craft a succinct message. This messaging could be geared toward potential investors, partners or customers. An elevator pitch is a common metaphor that has gained wide acceptance. An elevator pitch is a short statement that explains (to investors or other interested parties) the most important facts about your company – all within the time frame of an elevator ride.
Here is a short version for the elevator pitch:
| For | Customer/customer segment, |
| Our business provides | Solution description |
| To | Customer Need As Insight (on why it is important for customer), |
| Customer Need As Insight (on why it is important for customer), and | |
| Customer Need As Insight (on why it is important | |
| Currently, | Competitive alternatives |
| Lack/are | Competitive advantage(s) |
| Without this solution, customers will | Impact (loss) of inaction/compelling event for customers to get this solution from you |
Here is an example of an elevator pitch of a fictional company called “HomeMeals”:
| For | Busy professionals and stay-at-home moms, |
| Home Meals provides | A mobile social platform |
| To | Help stay-at-home moms of various ethnic and cultural backgrounds to sell home-cooked meals from their home, As they have the best recipes for ethnic meals which they love to share with others, |
| Stay-at-home moms need to earn extra income, As they want to feel an important member of the family and contribute to the community, and | |
| Busy professionals have access to healthy, home-cooked meals, As busy professionals are always looking for ways to eat healthy, home-cooked meals daily but don’t have access to them today | |
| Currently, | Stay-at-home moms use social media platforms to advertise their offerings |
| Which lacks | Tailored experience for this purpose and limited reach |
| And | the only option for busy professionals is to cook in the morning or bring food from previous night’s dinner to work |
| Which | They don’t have time and discipline for doing |
| Without Home Meals | Stay-at-home moms will continue to feel neglected and busy professionals will continue to eat unhealthy expensive meals at restaurants. |
This way, you will be able to communicate your message in a compelling manner to pique the interest of the investor, who will likely follow up with more questions or ask you for a follow-up meeting to discuss your offering in detail.
Here is a longer and more comprehensive version:
| For | Customer/customer segment, |
| We provide | Solution |
| To | Customer Need As Insight (on why it is important for the customer), |
| Customer Need As Insight (on why it is important for the customer), | |
| And | Customer Need As Insight (on why it is important for customer); |
| Currently, | Competitive alternatives, including status quo (how is the problem solved today) |
| Lacks/are | Competitive advantage |
| Without this solution, customers will | Impact (loss) of inaction/compelling reason for customer to use your solution |
| The global addressable market is | X Billion dollars/Y million users |
| We will focus on | Initial target segment |
| And reach the customer through | Channel (how would you go to market/how would the customer know about your solution?). |
| And expect to grow | Growth rate in the frst three years or number of users (or growth metric) |
| Our business model is based on | How will you make money? or how much would you charge on what metric? |
| Our unique selling proposition includes | (Key features, intellectual property, channel relations, access to market,…) |
| We have a strong team that | Why is your team best positioned to win here? |
| Finally, our beta/ prototype has been available for | Duration since the prototype has been available |
| And used by | Number of users already trying the beta version |
| We have already made | X dollars in this initial period |
| We are looking for | Y dollars |
| For | Z percent equity stake |
| To | Explain what you will use the investment for |
| Ideally, our investor will | Mention if there is any special quality you are looking for in an investor (connections, experience, guidance, industry access, etc.) |
Continuing the example of “HomeMeals,” here is a longer more comprehensive version of the pitch.
| For | Busy professionals and stay-at-home moms, |
| HomeMeals provides | A mobile social platform |
| To | Help stay-at-home moms of various ethnic and cultural backgrounds to sell home-cooked meals from their home, As they have the best recipes for ethnic meals which they love to share with others, |
| Stay-at-home moms need to earn extra income, As they want to feel an important member of the family and contribute to the community, and | |
| Busy professionals have access to healthy, home-cooked meals, As busy professionals are always looking for ways to eat healthy, home-cooked meals daily but don’t have access to them today | |
| Currently, | Stay-at-home moms use social media platforms to advertise their offerings |
| Which lacks | Tailored experience for this purpose and limited reach, and |
| And | The only option for busy professionals is to cook in the morning or bring food from previous night’s dinner to work |
| Which | They don’t have time and discipline for doing |
| Without HomeMeals | Stay-at-home moms will continue to feel neglected and busy professional will continue to eat unhealthy expensive meals at restaurants. |
| The total addressable market in USA is | $12 billion and reach potential of about 30 million stay-at-home moms and 50 million working professionals. |
| We will focus on | San Francisco Bay Area and Los Angeles frst |
| And reach the customer through | Social media advertising and ethnic grocery stores |
| And expect to grow | To a million users within three years |
| Our business model is based on | Per transaction cut through our platform, similar to Uber, Lyft and AirBNB |
| Our unique selling proposition includes | Understanding of the ethnic food market and first mover advantage |
| We have a strong team that | Includes a home chef, a superstar online platform development expert and social media advertising expert |
| Finally, our beta/prototype has been available for | More than six months in the South Bay region of the San Francisco Bay Area |
| And used by | More than 500 professionals and 75 stay-at-home moms |
| We have already made | $50,000 by serving about 15,000 home-cooked meals and are growing at a rate of 20% every month |
| We are looking for | $1 million |
| For | 15% stake in our business |
| To | Expand to the entire Bay Area and Los Angeles, stabilize the platform and invest in marketing in these metropolitan areas |
| Ideally, our investor will | Be passionate about social platforms and peer-to peer sharing economy, and of course, love home cooked ethnic meals |
As you can see, this version is much more comprehensive and conveys the entire story and future vision in a succinct and compelling manner.
Session Lead
This is a collaborative exercise to be done on a whiteboard, in a wordprocessing document or on a spreadsheet. As you can see, there are a lot of numbers that you have to prepare for this pitch, so you need to do an analytical analysis. There are numerous books and online material which will help you in building the analytical models for your business. I cannot stress the importance of bringing emotional appeal enough. Although the analytical portion of the pitch is important, the emotional portion supersedes it hands-down. Even if you have all the numbers to back your business plan, if you lack the emotional punch, you won’t win the investor.
So practice it and bring the emotional reasons out in your making the pitch to your team. Make sure all team members get a feel for how the pitch will be received by the investors. Once the pitch is well practised and rehearsed inside your team, have practice pitch runs in front of friends and
other mentors or investors who are not interested in investing in this space but would be happy to provide feedback. During Stage 1 and Stage 2, you must have obtained numerous stories from the users. Weave those user stories into your pitch.
After the session, the session lead should ask the team to write down all the
assumptions made and record those assumptions in assumptions template in Stage 4.
Review the prior steps and adjust as needed with the consensus of the team.