When you’re trying to find investors or make early sales for your tech startup, getting people to understand your new offering is key.
The essence of new, tech-based products and services is that they are original and based on some sort of technology. Therefore, by their own making, they can be difficult to explain.
If no one understands what your new product or service does, or the problem it solves, they won’t be interested.
Here are three ways to overcome the potential pitfalls of pitching your tech startup.
1. find an analogy
Pitches nearly always are constrained by time. You may be in a pitch contest with strict time rules, or you may have a less formal window of attention with your potential VC or buyer. The other challenge is you’ll frequently walk into a pitch situation where your audience has little background information provided in advance.
Your pitch almost always starts with your audience trying to figure out what you do.
You want to minimize the time they are in that “confusion zone.” Until they are out of that uncomfortable place, they’ll never start to think about buying from or investing with you.
The sooner you can get your listener starting to say, in their head, “yeah, yeah I get it,” the quicker they can consider buying or investing. A fast and easy way to cut through the mud is to use an analogy that will make your unique product understandable.
Analogies give easy access to complex subjects.
Your analogy can be fairly straightforward. For example, at The Rise of the Rest pitch competition, the winner, Rapport, said they were like the QuickBooks of sustainability tracking. Saying they are like Quickbooks tells you: it’s software, it helps businesses, it makes available to small businesses what used to be just a large enterprise application.
Another example that may help is: LinkedIn is the Facebook for business professionals. People used this analogy a lot a few years ago to get people to quickly understand what LinkedIn was all about.
Analogies can also be a bit more whimsical. You can make one up: “We’re like a giant sorting machine that automatically identifies and separates small leads from giant ones.”
But, don’t get too carried away with your analogy. There does not need to be a detailed parallel between your product and what you’re comparing it to. In fact, that will probably backfire.
Use the analogy just to quickly frame up what you do.
2. Make them feel the pain
With new technology, many people won’t understand the technical side of your solution. However, they will emotionally connect with a good story of pain.
I recently read about Slack and they are describing themselves as alleviating the pain of email. There are many tools that are attacking this problem. The solutions are different, but grabbing onto a pain point that people can relate to is key.
Another great way to handle this is to tell a story where you build out a character that has a unique need for your product. Many new startups only cater to niche audiences, and if that is the case you need to learn to quickly describe your typical client and articulate why this small market really needs your solution.
Tell the story in a way that your potential investor feels the pain.
Note, for direct sales, you shouldn’t need this side of the pitch as hopefully your potential buyer already experiences this pain. However, some may not see just how bad it is. For example, getting back to the idea of Slack being the email killer, they are able to share great stats about how much time is wasted with email use, it was eye-opening.
3. analyze your competition
With patented processes and new technology there can be a lot of bravado around saying there is nothing like this on the market. Unfortunately, that begs the question of why the market needs it.
Listing your key competitors and how you are different accomplishes several things.
First, it shows that there is a market for people looking for solutions to a real problem. If there is no one else exploring in this area, it’s probably a pretty risky venture. Many new technologies are actually pretty iterative. An advance in one area leads to advances in another and step-by-step we move forward.
Secondly, it shows that you’ve done your homework. From there, you can clearly articulate why you are different and better. Give yourself that opening. It’s your chance to show what is truly innovative about your product and how you plan to penetrate the market.