No Pain No Gain

Raising investment capital is brutal.  It’s a jungle out there. Early-stage capital has never been more difficult to raise.  There are too many business plans chasing too few open wallets.  The entrepreneurs who can capture the imagination of an investor on the first slide has a higher probability of gaining the undivided attention of their audience throughout the remainder of the presentation, subsequently leading to closing on an investment.

Now, more than ever, it is important to capture the investor’s attention immediately by showing that you understand your customer’s needs and how to translate those needs into a profitable investment.  There are hundreds of entrepreneurs, just like you, seeking an investor’s interest, time and money.

  • Is your presentation going to be the one investors remember?
  • Do investors understand how you’re going to make money?
  • Have you demonstrated that you understand how you’re going to make money?

Imagine you are captain of a team and you are offered the choice of Kobe Bryant or Michael Phelps.  Wouldn’t you want to know if you were playing basketball or swimming?  Talking about technology, go-to-market strategies, and your management team prior to explaining the playing field is putting the cart before the horse.  Don’t talk about your team or the quality of your cleats until you’ve defined the turf.  Clearly articulating the market pain clearly defines the game.

In their efforts to raise capital, too many entrepreneurs spend too much time talking widgets and not enough time inflicting pain. Slick widgets are of little value if they don’t cure the pain of a customer. There is no lack of cool widgets. Surely the next-big-thing will be a slick widget, but the next iPod, iPhone, or light bulb is going to be a slick widget that feeds a market hunger, fulfills a market need, and cures a market pain.