6.0 Elevator Speech

HOW TO PRESENT A BUSINESS PLAN >> Each section contains key Action Items located within the downloadable Action Guide >> Click to Download Action Guide.

Congratulations, you’ve now completed your first draft of your business plan presentation.  It, of course, isn’t ready for “prime time” yet, but you’ve taken the first critical steps of drafting your PowerPoint slides and written a narrative to go with it.  In a later segment we’ll talk about polishing the presentation but first, let’s tackle one of the most critical tasks of the entire presentation process: developing your “elevator speech.”

As we mentioned before, your “elevator speech” will last all of 30 seconds, but it is an extremely critical 30 seconds.  Here’s why.  Without your “elevator speech”, you can have the greatest investor presentation ever created, but this greatest ever presentation will be equivalent to the greatest billboard every created if that billboard is placed in the middle of the Gobi Desert.  For a billboard to be useful, no matter how fabulous the content, it must have eyeballs looking at it.  Plain and simple, you’ve got to get eyeballs.

The presentation you’ve just painstakingly prepared will be equivalent to the billboard in the desert unless you can get potential investors to listen to it.  The reason goes back to what I said earlier.  First, you’re highly unlikely to get potential investors to read your written business plan.  You’ll be more successful if you can do an investor presentation.  Potential investors don’t want to read long documents. Second, you’ll only get these potential investors to give you an opportunity to pitch them if you can provide them a short, pithy “teaser” to the plan.  That short, pithy “teaser?”  Your elevator speech.

Before talking about the particulars of your elevator speech, let’s take a moment and talk about the kinds of things that might get a potential investor interested in hearing your investor presentation.  What could you say that would get his or her attention?  Keep in mind, the people you have in mind as potential investors are probably hearing the same thing from dozens, if not multiple dozens, of others.  Why should they want to take time to listen to you?  I think they’ll listen to you if you can persuade them of the following:

  • There is an unmet need in the marketplace and you have a way to fill that unmet need
  • You have a credible team with a plan to build a successful company filling that unmet need
  • An investment by the potential investor will permit you to achieve the plan
  • The success of your plan will produce the desired return the investor seeks.

There is no guarantee that you or your plan will accomplish this, but your investor target would turn and run the other way if he or she thought you were promising a guarantee on this.  But if you can convey, in a very concise manner, the four points I’ve mentioned above, you’ve told the potential you have something that he or she ought to at least consider.  So your elevator speech is designed to say, in about 30 seconds, that your investor presentation contains those elements and that the potential investor should give you an opportunity to make a presentation.

You’ll recall my father was the greatest salesmen I said I’ve ever known.  Remember what I said was his objective for the first sales call?  It was nothing more than to get another appointment.  He knew he’d virtually never make a sale on the first sales call, so he needed to get at least a second sales call.  When you meet a potential investor, whatever the circumstances, it’s your first sales call.  Your objective is to get a second sales call. The elevator speech is your first sales script.  It has one objective and one objective only: get a second appointment, one at which you can give your investor presentation.  Assume you have 30 seconds to get that second appointment.

Your elevator speech, much like the investor presentation you’ve just put together, has four parts, each part addressing one of the four elements I just said the potential investor is looking for.

  • There is an unmet need in the marketplace and you have a way to fill that unmet need
  • You have a credible team with a plan to build a successful company filling that unmet need
  • An investment by the potential investor will permit you to achieve the plan
  • The success of your plan will produce the desired return the investor seeks.

Your investor presentation already answers these questions, but you’ve got to make your case in 30 seconds, not 20 minutes.  So remember what Mark Twain: I would have written a shorter letter but I didn’t have the time?  Well, let’s make the time to do it.  Let’s take that 20 minute presentation you’ve just put together and turn it into 30 seconds.

I’ve told you what the potential investor wants to hear.  Let’s figure out a way to use the formula I’ve outlined above to create your elevator speech.

Let’s start with the unmet marketplace need that your new product or service fills.  Try to come up with a way, in approximately one sentence, to say the following:

“There is a need in the ____________ market for a product/service that ___________.  My new venture, _________________, has developed ______________ that addresses this unmet need and will sell the product through ____________.”

ACTION ITEMS: Complete the Action Items in your Action Guide.

Fill in each blank to complete these statements to reflect your business/idea:

“There is a need in the __________ market for a product/service that ________.  My new venture, __________, has developed _________ that addresses this unmet need and will sell the product through _________.”

Now that you’ve made your first point, let’s move on.  You next need to complete the following:

“I, and the management team I’ve assembled with (fill in the experience you have), have developed a plan to build (company name) to meet the (unmet need). Our research shows this is a _________million/billion dollar market.”

ACTION ITEMS: Complete the Action Items in your Action Guide.

Fill in each blank to complete these statements to reflect your business/idea:

“I, and the management team I’ve assembled with _________, have developed a plan to build _________ to meet the _________. Our research shows this is a _________million/billion dollar market.”

Now that you’ve made your first two points, let’s move on to the third point you want to make, that an investment in the new company will permit you to achieve the plan.  Complete the following sentence:

(Company name) is seeking an investment of ______________ that will permit me to execute my plan to _________________ by ______________.

ACTION ITEMS: Complete the Action Items in your Action Guide.

Fill in each blank to complete this statement to reflect your business/idea:

(Company name) ___________ is seeking an investment of $_____________ that will permit me to execute my plan to _______________ by ____________.

Now that you’ve made your first three points, let’s move on to the final point:

With this investment, my team projects an exit within ___________ years that should generate a return of at least ___________X.

ACTION ITEMS: Complete the Action Items in your Action Guide.

Fill in each blank to complete this statement for your business/idea:

“With this investment, my team projects an exit within ___________ years that should generate a return of at least ___________X.”

Now that you’ve completed the four key parts, you need to add your action step, something along the following lines:

“If you’re an accredited investor, I’ve prepared a brief investor presentation that I’d like to share with you, if I may.”

Now take all four parts, add the last sentence, put it together and read it.  It should take you about 30 seconds to say it.  You’ve succinctly conveyed to the potential investor the key things he or she is seeking in an investment presentation.  Now the potential investor may say he or she isn’t interested.  After all, every sales pitch gets turned down from time to time.  However, if you’ve got a qualified prospect, one interested in your market space and investment time horizon, there’s a good chance you’ll get your next appointment, one to give the full blown investor presentation.

ACTION ITEMS: Complete the Action Items in your Action Guide.

Combine the first three parts of your elevator speech and then add the this final statement: “If you’re an accredited investor, I’ve prepared a brief investor presentation that I’d like to share with you, if I may.”

Say it aloud and time it. Do this a couple of times. Record the time for each attempt:

1)

2)

3)

4)

5)

Did you get it to about 30 seconds without it seeming too hurried?

Take this first draft of the elevator speech and try it out.  Commit it to memory and present it to some friends, family, or co-workers.  Gauge their reaction to it and act upon their comments. First, does it make sense?  Does it flow smoothly?  More particularly, ask them to tell you whether you are presenting it in a way that sounds convincing. If not, go back and work on the presentation.  You want to make sure it sounds convincing, not as though you’re reading cue cards.  Have you ever watched a testimonial on an infomercial?  Don’t they sound contrived?  Sometimes you can even see that the person giving the testimony is doing nothing more than reading from a Teleprompter.  That’s the sort of thing you want to make sure you don’t do! The people on whom you practice your presentation will tell you if you’re doing that.

At the same time, write out the text in the form of a business letter as well as an email.  Make sure that it flows smoothly.  If it doesn’t, go back and work on it.  Keep working on this until you feel totally comfortable.

I recommend you do two other things to improve the presentation.  First, videotape yourself giving the elevator speech to someone else.  Go back and watch the videotape to make sure you’ve given a good presentation.  What are things to watch out for?

  • Do you look and sound convincing, or does it look as though you’re uncomfortable?
  • Do you sound natural or does it sound as though you’re reading cue cards?

Second, listen to the videotape without watching so you can judge the sound of your voice.

  • Does your voice sound natural?
  • Do you sound convincing?

Once you’re totally comfortable with the elevator speech, share it with your business associates.  Just like you, they come across people who might fit the bill.  Keep tweaking the presentation until you’ve got what you want.

Just like Twain’s proverbial “shorter letter,” it will take you some time to get this down.  Keep working at it until you do get it down.  After that, practice, then practice some more, then practice even more until it’s completely natural.  Ask your associates to do the same.

You’ve now prepared both your elevator speech as well as the first draft of your investor presentation.  Now it’s time to get the formal presentation ready for prime time.  We’ll discuss that in our next segment.

ACTION ITEMS: Complete the Action Items in your Action Guide.

FIRST, continue practicing your elevator speech until you have committed it to memory.

SECOND, test it on your friends, family, and colleagues. Ask them: does it make sense? Did it flow smoothly? Does it sound convincing?

Write down their comments.

THIRD, take what you learned and make improvements.

Videotape or record yourself saying the elevator speech. Do a few “takes” in a row. Review all the takes. Note what you liked.

Next, listen to the videotape without watching it to assess your voice. Go through each “take” and note what you liked.

FOURTH, refine it, video it, and review it again. The more you do the better you’ll become at delivering your elevator speech.

LASTLY, when you feel comfortable about your ability to deliver the elevator speech, test it out again on your business associates. Refine it if necessary and practice it some more.

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Next — 7.0 Present to Investors »