July 13, 2020

Pitching your company right and speaking with investors, by Brandon Walker.

Pitching your company right and speaking with investors, by Brandon Walker.

In this episode of Fundraising Radio, Brandon Walker a Venture Fellow at Go Paladin explains how to construct your pitch deck, shares the major rule of it and then goes into details of the common mistakes he sees on the pitch decks of the founders he works with. We also discuss how much time should you spend on researching your competitors and how much should you know about the competitive landscape.

Brandon Walker's LinkedIn: https://www.linkedin.com/in/biomwalk/

Go Paladin: https://www.gopaladin.org/


Transcript

Alright, this is fundraising renew entities.
I guess people who have Brandon Walker venture fellow at go, 

and this episode will mainly talk about brands work with founders and his main work is educating founders on speaking to investors and teaching the investors on what the company does. 

So we'll talk about making a research on your competitors, preparing the pitch deck and presenting that to the investors. So, Brandon, let's kickoff by you giving us some background on yourself and on go. 

Yeah, so everybody in Brandon I work at gunpowder and I'm officially, there's been a little bit about my background is that I have to I have to break you up. Sure. There's something with your sound. 

It's not like an echo, but there's like a tiny echo. So, it's not bad, but if there's something you can do to the microphone or to the, to the, to anything that might be affecting that. 

I have no idea where the echo might be coming from. I'm just using my AirPod. That's that's strange. That's strange. But there's like, let me see if I just like she should take your time to your time, though. There's no rush. 

Makes sense. Yeah, it does. Alright. No worries. So I already made the introduction, so let's just give us some background on yourself and on go. Okay. 

Okay, yeah, so so a little bit of background about myself, I I guess I can start, which is the university student. So I went to Stanford, got a masters, got a bachelor's in bio engineering are a masters in chemical engineering. 

I did a lot of bio work before and during that, and so I was really heavy in the lab work world. I worked with like, Lincoln University, children's hospital in Philadelphia, doing clinical research. 

I ended up working at Slack, linear accelerator at Stanford, but after that research, I kind of realized that there was more to life and that business might be more compelling. 

So, in my tail end of Stanford, I did what I like to joke at the boot, like MBA, where I took a bunch of courses, adventure and business entrepreneurship to kinda get my legs on that factor of the world. 

And doing that amongst a few other entrepreneurial things, took me the venture and I worked for a while at a venture firm where basically we were algorithms to do our company sort of thing. 

And so kind of a general premise is that if you're a good company, you shouldn't need a warm introduction or a cold call to an investor to be able to get funding. Right? It should be inherently obvious that your company's good. 

So, based on app, traffic or web traffic, right? If you're truly a good company, you will be in the top one percentile of visible growth from from a regular person stamp. And so that was a huge focus we're working on is is writing algorithms to kind of capture these. 

Distinct points of not just explicit ways this variety of them as well. But ultimately,
what that informs me is is kind of a no BS form of investing where, you know, 
I'm, 
I'm a data driven Chris, 
and I'm an engineer by trade and so I look for absolute fundamental and things that drive a constructive, 

compelling, 

quick case, 

as opposed to a theoretical hypothetical, 

get some check case. 

And so the learnings I got from that experience, took me a little further in the world adventure. 

And so now I work with, 

which is the adventure adjacent firm, 

that primarily partner with everything from women to just generally under privileged and and works with sharpening them on on their pitches and their preparation for joining this journey. 

So, I rarely see, I'm a PC companies. Are what I coach and yes, I, I hope I help them make sure that they've cross cross duties and that at all got it. So. 

Next question is, what do you invest in? So what does go Pelosi invest and so you mentioned that usually someone under represented can you be more specific? 

And is that, like, are you focusing on female founders or are you focusing on? What do you focus on my past experience? I was working at a series a sweet spot fund. 

They would do a little a little bit of see, but the goal was three million dollar checks that they made and now go Palin officially at the at the time. 

It's not officially a fund, but like I said, we're introducing fund, which means, we just we work with people and introduce them to venture capitalists. We introduce them to connections and advisors and things like that. 

You think of kinda the benefits of Y, Combinator or something like that just currently without the, without the check. So, all of the advice that you would get that actually, founders so often have access to right? It's like, what are vc's thinking? 

What are we talking about like, one of the tricks of the trade, except you don't have to be shackled to some equity driven program or. 

You know, any other kind of official program in that sense. Right and so normally, in order to get this knowledge, you have to be a part of one of those programs, because they want their Cooper to be exceptional and have success. Right? But then, no one else will tell you outside of them and so that's kind of our sweet spot. 

And our magic is doing that, especially for, like you said, women under privileged founders I'm pretty much anyone who applies and we accept. Right but that's kind of a understood. 

So you work a lot with founders, you know, helping them to communicate with investors, helping them, understand venture world. 
And I imagined that's work with a lot of first time entrepreneurs, or just early stage or printers, where the major mistakes that you see them making. 

But one of the huge things actually been coming up a lot this week, is that I think that there's like I said, because there's a lack of a real information about the venture world. Right? There's a lot of people who make blogs the medium articles about. Here's how to raise money for your company. 

Here's how to do a pitch deck. The thing is the way those things to propose is, it's a lot of kind of box checking their checklist that they they make for pitch decks. And so you see a lot of pitch deck pitch deck that look identical from company to company. 

And if you can think a little deeper about that, right? A company that's doing, like, real estate management. 

Can have a constructively different style of pitch than someone who's making a social network. Right? The thing is, if you if you look at just any given cede founder pitch deck, they're probably very similar. 

And the reason for that is, is people take the advice of these online medium blogs, and they don't really think critically about within and so you get a lot of people who, you know, use cliches. Right? So they have a slide somewhere in there. 

That's like, here's the over for X and there's another slide right? Like, and they have these kind of slides and you asked the, why do you have the slide? And they don't. 

They don't have a reason, right? They're like, oh, I just wanted to see a hundred. Yeah, right and so kind of work with them to think more critically about why would you have a slide like that? And what's the purpose? What is what? How does this fit into the story? You're trying to tell, right? 

So, yeah, I think major mistakes are just filling up slides to fill up the space and not to tell a constructive story that benefits the business and the idea you're trying to go. Absolutely. 

And what you mentioned is just something to hate so much, so so much I see. So so often, which is over for acts, like, stop stop. 

But so so, people licenses please do not do that if not that's not something absolutely necessary for your business. 

Okay, 

so let's talk about the research of the competitors that's something that I personally think is probably one of the most valuable things and validating your idea, 

even if they're early stage specifically how how deep should people go into the research of their competitors? 

So, how much time should they spend per company? How deep should they go and should they review the pages of the founders to see what their background is? Should they go into actually get some free trials? 

Should they should we try to pay for the product to understand better? How precise should they be. 

So, kinda, let's pick it back up for X comment. Right? Just like, you know, it's great story. I care. Right so if you genuinely think of your business as some other business model transformed for some new market, right? 

Which, by the way just it's okay to use that sometimes if you're using it correctly, right? However, you know, when it comes to doing research, right? Effectively as a VC I professionally no less than you. 
Right? 
You're coming to me as kinda almost a superior person, and not not superior person, but like, a potential advisor someone who knows a lot about business and not about it. Right? 

I'm gonna know enough about this about maybe I, I've heard of your, your vertical a little bit to be able to ask you a series of very in depth questions, but questions that are coming from a point. Right? 

So, I'm looking to gain information from you about your market and then be I'm looking to use that information kind of almost against, you dig deeper about your market. Right? And so this is what every VC is doing, right? 

So they're gonna sit back and listen and then they're going to start asking you some really targeted questions That'll make you would the founder almost think that they know more about your marketing right? This is what they're trying to do. 

So so the thing about the research is, you know, you're coming into my office, asked me for a million dollars, you're claiming that you have an idea. That'll That'll make you join the ranks of Mark Zuckerberg those who are wants to move right? You know, these, these millionaires billionaires people. 

Great Society world changing ideas, right? If you're making that claim, which is by being in my office, that's what you're making that claim and you don't know everything about your vertical. If I can isolate that in our twenty thirty minute chat. 

It's a serious problem. Right? Because just asking intuitive questions to you based on the information, you've shared. I've come to a question that you haven't thought about. Right? And it's like, how am I gonna trust you with a million dollars? 

If you know, you haven't, even given me the respect and time of making sure that you've plugged every hole before you walked in off right? That's a serious critical error that it will almost immediately in most cases, you know, shoot you in the foot regarding getting funding. 

Right? And so as far as how much research should you do? Right. You should be comprehensive about all the research on potential competitor and about adjacent competitors. Right things that are, they transitioned. They'll be overlapping with that. 

And even some things that are completely irrelevant, because the investor might not fully understand what you're doing and they might take a like a, a company that's in the same space, but it's not completely competitor at all and they might ask you about right? 

So you have to know everything that potentially, you know, even with the stretch could be related to that space. I should know something about it enough to respond to it. And if you're doing E, commerce be prepared to answer something about Amazon, although Amazon might not be related at all. 

Many vc's will just throw in Amazon just for the sake of it. Right right. We touched on to pitch deck shortly we've discussed. 

So, the major mistakes that you see on the page, that was your advice in terms of what should people put on the pitch deck. So, where the major green flags that you see on the pitch deck, basically. 

So, as a general theory pitching theory, if you will, when you walk into my office, we're gonna shake hands and say, hi or whatever, but when we start the pitch, right use about five minutes to do a few things. Okay. 
So, first and foremost within, like, thirty seconds, I need to know what topic we're talking about. Right? 
Like, I need to be clear that we're not talking about real estate that we are talking about any comments or something like that. Right? Shortly after that. I should understand what problem are you solving? 

Very clearly, like, because ultimately, at the end of this talk, I need to I need to start thinking about this problem myself, while you're talking. So that by twenty minutes from now, when I'm asking you questions, I will be more educated. I will be more well versed. Right? 

If you don't convey that problem upfront to me, I'm not gonna be able to get what I mean right? So, I need to know that you've conveyed a clear problem once again it's important for clarity right? Shortly after I need to know why you're working on it. Right? 

Maybe this has to do with the business, the market, you know, a variety of things. Right? But then the last question I need to check with him, this five minutes is, why are you working on? 

And I know that's the same question they said, but the emphasis on the you,
in other words,
as a, 

as a seed as a Pre seed founder,
I'm not investing in your company,
because we all know that that companies can't people pivot, you know,
your hypothesis is somewhat correct,
but it's probably wrong. 

Right. So when when you get a million dollars, right? Like, when you get a million dollars from a VC, I need to know that you, as a person are self awareness and humbled enough to admit that, you know, what? 

My thesis was wrong and hopefully you're intelligent enough to realize that two hundred thousand dollars in instead of nine hundred thousand dollars in. Right? 

And so when you realize that now, I need to know that, that you are humble enough, an industrial industrious enough to ask around to get advisor on what direction is best to pivot right? 

So far more important than the business you're working on as an early stage fund. A venture capitalist is invest is it sorry investigating you as a person and trying to find out? What sort of person are you? 

Because it's the founder that will take this the different, it's not the initial business plan or the pitch deck. Right? So, in those first five minutes, that's the boxes that most of the things are looking to check because after that, right it's all questioning. It's about Nuance. 

It's about understanding, so that, you know, you know, a few hours to now when I'm on lunch break and the partner is like, oh, did you see any cool companies this morning? I say oh, there's this cool company that does this thing. And then I basically do your pitch for you to my partner. Right? 
Which there that's cool. That's interesting. Let's call them back. Right? If I can't do that if I can't 
emphatically pitch for you on your behalf to someone else at from. 
Are you getting a phone call? Right? So, alright. That's actually that's a very valid and nice structure here. Thanks for that. So, let's talk about fundraising now during just been dynamic. 

It seems to be getting a little bit better than it was two months ago, but still pretty bad. What's your recommendation on? On this topic right now so, for founders who are trying to raise money right now during the virus what's your advice to them? 

Yeah. So, I, I don't think it's never been a better time to to be starting a company. Obviously things might be a little dicey for you if you are, if you were looking to raise during this period. Right? 

Because a lot of investors are re, evaluating there against theses, if you will on how they want to invest, because, you know, some people want to wait out the time some people are trying to capitalize and other people waiting out. Right? 

So I don't want to speak too much to the timing of things, but I think that around corona time hearing covet, I think it's really important to just, you know, focus on the fundamental. Right? 

And, like, in the end of the day, we're looking for a good business that people will hopefully see as as important and necessary to their life to their workflow to their hobbies or whatever. 

Right, and what better time to test out those kinds of theses than when people are pitching a bit right? Like, not all of us, you know, many of us are not just finding anything that we feel like buying that's within our means. Right? 

Many of us are re, evaluating our businesses and deciding what we actually need and what we don't need. Right? It's a perfect time to say, hey, I know that. Hey, head of sales at some company that buys every B, two B staff that walks in the door. Right? 

I know you guys are working on systematically cutting half the things that you pay for. 

And this is why maybe I'll do a free trial with you guys because I really think that you guys will get ten X value off of my product over anything else from you is a great time to use your connection. If you have the right ones. 

And then you can great time to hustle and get some connections. Right also many important. People have been laid off and those kinds of things. And so they're just sitting at home with their families. So they might be open to LinkedIn and stuff like that. Right. 

So, the really great time to prove your creativity in your industry is as a founder and test some experimental business model, the test validity of your product with a broader audience because that audience has time right now. 

And so, let's talk about, how do you raise money and how do you build your company? I think there's never been a better time to go out and do those things. Right? 

I think she just put a lot of pressure on listeners right now, because many people that I've talked to, they're like, oh, yeah, our fundraising slowed down. The company's slowed down because there have been damage. Sure. Just saying it should actually speed up, but I think really the point. 

Yeah, and you mentioned something that a lot of people asked me, which is no gain new connections reaching out to the people who might be her partners who might be your investors in a year, or. 

About two years, how, how would you recommend doing that? Is it just purely through LinkedIn or are there any other tools we recommend. 
So, one thing, and this isn't all honesty and this is something. Obviously I share with a lot of the people. I work with that, go power in because as we all know venture is abounding. 

We filled with, like, Stanford grads and Ivy League grads and those kinds of things and and all this kind of pretentiousness building the resume lines. That are very pretentious and very about twenty of them. 

That make people's eyes light up, and I work a lot with people who are from outside the Silicon Valley from people who are for lack of more proper vocabulary, people with normal backgrounds. Right? And the thing is Ventures evenly distributed. 

I think anyone anywhere can have a great idea not just someone who waves a degree that for some reason, the rest of society put more weight on. Right and so I'm a huge enthusiasm for that. And so, I don't know. I think I think. 

You know, 

I I just, 

I think that when it comes to being industrious, 

I think that if you genuinely believe you have a good idea, 

that's the unfortunate part about having a background that's not as currently belted with venture right is that you still might need to reach out to that billionaire that important to you, 

right? 

Like, if you want your business to succeed, and you need to call you on months like, as a venture capitalist, it doesn't matter to me what your background is. I need to know that you can get to you on months, your business depends on them. I need to know that. You can network your way to him. Right? 

That's not a problem to figure out, but there's advice on how to do it. Is that, you know, the bad example for this? But like, a lot of people who hold high positions. 

Or lower positions that no one contacts, right? I mean, LinkedIn is a really powerful tool and so maybe you need to contact the head of sales at a, at a company and maybe it's like a company. That's really large. Right? Maybe that guy's pretty busy. Right? 

But he's got, you know, vp's and whatever's below V. P. right. Those other people, right? Because everyone wants to reach the head of sales, right? This is a whole two tiers of people below that individual who are reaching out to. 

Right? And they get a little creative Frank reach out to someone who's once removed from the person you want to reach right? Talk to them. Get their insight, treat them like the V. P. the CEO, right because everyone wants to feel special right? 

And so many people are working so hard that someday someone will want to come to them for advice. Right give them that opportunity. 

Because who knows, maybe later that day, they have a meeting with the VP of, like, I talked to the group, and I wish I can help them, but I think you'd be better fit for you. We'll make the introduction for you. Right? 

Everyone I'm here everyone in America is running the race of capitalism. We're all trying to level up here in there. Right? People will help you out and also also, you know, as a, as a small note, people 
help those who are helped. Right? 
So, if you offered to help them in some way, the offer to the world works. And so when you want to network, when you wanna hustle around step, one don't be afraid to be bold and reach out to anyone. But second about offer to give them something. 

And see, don't they give you something in return? 

Absolutely, that's exactly how stuff works and even if even if you just give something to someone and you don't get anything back, it's okay you know, one day you'll meet someone who is just gonna do the same thing to you. So yeah. Don't don't be afraid to help people. 

We're being really altruistic in this episode, but I like it. Very, very around comes around. Right yeah, exactly. Exactly. Generally generally, it always works. 

So, let's move on to the last question of today's episode. We, she's a call to action so was the one specific thing that you would like the listener to do as soon as the episode is over. 

Well, obviously, there might be mixed crowd as far as listeners are concerned. But I think that last point was really important is that it takes five minutes of your time to research someone who might be useful for your business. Let it be an adviser a partner. 

Your first customer VC anybody, right? No. One is too important for you to talk to you, because you're out here playing in the big way of venture capital and finance and sounding a company, right? 

You wanna find a billion dollar company like, 

we're all people, 

everyone's just no matter what their title or their paychecks it so take five minutes today and go out and reach out to someone who you've never talked to go out and just talk to a stranger and see see what happened, 

you know,
if you're if you're you're not too ready for that next time you take an Uber. 

Don't be afraid to pitch your company to a new project. Every, every person you meet that. Practice will help reinforce you as a founder and reinforcing and communicating your idea. Right? 

I think those kind of things, you know, this be there to be bold because founding a company about the borders thing you can do. So, with being bold is in. 

If it's a drop in the bucket of a very long road. Absolutely. And that's a great advice right now. Everything. 

I mean, everything shut down you can really talk to strangers that they'll just look weird, but there is Internet so don't talk to or drivers. Probably just reach out to someone on LinkedIn as Brandon. 

You said, I'll reach out to someone you would never talk to, which I think he's wonderful advice on that might lead to something really cool. And if it does make sure to get back to us and say help, thank you, thank you for Brendon. Okay, be nice here. 

Alright, we'll wrap it up here and thanks a lot Brennan for coming up and for sure. And your experience sharing your knowledge. I think that was really insightful episode, so thanks a lot for that. For sure. And just for anyone who's listening, I mean, you guys can find me on LinkedIn. 
My name is Brandon Walker more than happy to take a call to chat whatever. It may be. Just don't be afraid to find me and reach out. I might be that let's change it. Right right. 

I'll put the link to brendan's LinkedIn and the description of the episode so anyone hit him up. All right.