38. Identify the one strength you must emphasize in your fundraising pitch with four startup case studies

When you pitch investors, your audience will only remember a couple of ideas. Your job is to make sure they are your biggest strengths. In this blog, I will help you identify the aspects of your company that will wow investors.

I talked in previous blogs about why you need to highlight the most important strengths of your business in any presentation, particularly in pitches. If you need help creating the pitch, check out my complete pitch building process, check out this blog.

How do you decide which aspects of your startup will be the most important to this audience of potential investors? First, you need to get inside their heads. Try to understand what about your business will impress them. If you have not watched it, it might help to go back and revisit my blog on the nine things angels want to see in an investment pitch

I think that some real-world examples might be the most effective way to illustrate the kind of strengths that impress investors. In this blog, I will consider four companies I know well and the characteristics that made them stand out to me.

One thing that may surprise you is that none of these are about the technology or cool solution itself. Obviously, the solution needs to be valuable and desired, but there are a lot of companies that meet that standard. Most often, the startup’s best aspect is something outstanding about the company or business model.

One – Pet wearables platform

If you follow our interviews, you may already know the company I am talking about. They make a smart modular pet collar with an associated smartphone app. The app has a marketplace and supports other kinds of third-party integrations.

While they have gone through a few pivots, both in their products and in their messaging. I think they have nailed their key ideas.

This is a Platform, not a Product

The marketplace for smart pet devices is crowded, and many of them are having difficulty standing out. The company avoids that problem by positioning itself as a platform. They integrate deeply into the whole pet ecosystem and the lives of the owners.

The platform also provides multiple potential streams of revenue and partners that can act as sales channels: pet food, toys, medicine, vets, groomers, walkers, boarding, training, and many more. Also, the integrated platform is more sticky than a simple device. Switching to a different collar would disrupt many other relationships.

Additionally, they have active contracts with partners that are paying the company to develop integrations and are committing to help with marketing. They are in mature discussions with several more possible partners with different offerings.

This shows people that the idea is not some fantasy, but is real and works.

What I remember from their pitch: a platform, not just a device, with proven traction.

Two – Virtual group sports watching

This company created an app that allowed friends from college to continue to watch sports together virtually even after they scattered to the corners of the globe.

This company is inherently viral

You can’t watch sports with friends by yourself (obviously). Users have to recruit their friends to the platform. Because we don’t all have the same friends, that person would invite a different set of friends for other events. This exponential growth would expand the userbase automatically.

The company only needed strong execution to generate the effect. The company was inherently viral.

In addition to growth, the network effects in the business could exclude latecomers to the market. Once all your friends are on a platform, you don’t want to try to get them to move to a new one. If even one of your friends does not want to switch, the group will default back to the original one.

The pitch focused on the inherent virality of the business and how it created both growth and defense.

Three - Medical devices

I have seen several medical device companies that share the same strength. This is not a problem. Highlight your real strengths rather than something unique but less impactful. Their solutions were all very different, but their strengths happened to be the same.

This team will win

These companies all had effective products, solving big problems, in large markets. But that was not the grabber. What made them a compelling investment was the team.

The founders had worked together on previous successful medical startups. They have a track record of success. They know the space, the opportunities, and the traps. They already have relationships with manufacturers, doctors, insurers, the FDA, and so forth. They can talk about precisely and confidently about how they will bring the solution to market.

With a team like that, there are few unknowns and a high probability of success. That is music to the ears of an investor.

All the companies made a point of focusing on the obligatory team slide.

Four – Water-saving next-generation irrigation

This company developed an innovative lawn irrigation technology that saves water and reduces installation labor costs. They are reaching their market through landscaping companies who sell and install the systems for end consumers or institutions.

A Win-Win-Win alignment of interests

The key idea, and what pushed me over the line to become an investor, was how the company ensures that all parties are highly motivated.

The landscapers love it because installing this system takes a fraction of the time/labor as a conventional one, while the hardware costs are comparable. But, they charge the same price, so their profits go way up.

The customers love it because, for the same price, they save a ton of money on water. They also feel good about helping to conserve a scarce resource.

Recruiting new landscaping contractors is easy, and each one then drives new sales. Win, Win, Win.

Some companies have a murky path to market. Their deck made it crystal clear why this would get traction and take off.

Of course, there is much more to say about each of these businesses. All of their pitches hit all the required points. At the end of the presentations, I felt comfortable with the companies. They had addressed all my concerns. But, beyond that general feeling, the things I still remembered days later were these key points, which was the point. If you can identify and emphasize the best aspects of your business, as they did, you will have a big leg up on most of your competition.

The same concept applies to marketing, just with different points. Your customers won’t care about the same things that motivate investors. The smart collar company does not talk about platforms in its advertising; it talks about protecting the health and safety of fur-babies. The medical device companies talk about the health and cost benefits of their solutions. The irrigation company talks about improved profits and sales to landscapers and about saving money, saving water, and saving the planet to the customers.

Hopefully, those examples will be helpful with finding your key strengths. Many founders have a hard time with this exercise because they are too close to the business. They understand all the details and subtleties and may think the big picture is too obvious to state. If you are having trouble, find an outside advisor or peer to help you get the perspective you need.

Let me know if this helped clarify how to find those key strengths or whether I need to take another crack at it. I would love to hear about the aspects you identified either in the comments or over in the Founders Alliance group.