Week 7 - Techstars NYC

techstars-nyc-week-7

The Elevator Pitch

Week 7 kicked off the final stretch of the program, during which we would normally be preparing for Demo Day.  There have been a few posts written recently (Ty Danco, Ross Baird)  about why we should be changing Demo Days, and Techstars NYC has been experimenting with a different format.

Now, I’m not going to write about that new format until I’ve experienced the whole thing (ie. after the program), but the first step in this new format is the elevator pitch, which I’m going to write about this week.

The first thing to be noted about the elevator pitch is that it’s context-specific.  A pitch given for a formal elevator pitch competition should not be the same pitch you give someone next to you at a cocktail party that asks you what you do for a living.  There are, however, some similarities.

The main one: the goal of the pitch is to get the other person intrigued.

Now, maybe you don’t like cocktail parties and would rather not have someone inquire further about your life, but let’s assume you do.

Great Elevator Pitches

I wrote last week that you need to be able to convey your vision clearly and in simple terms, and touched on a few of the things that make a good elevator pitch, namely:

  • Talk about the opportunity, but limit yourself to one number.
  • Don’t talk about features, but instead benefits.
  • Explain why, or your credibility.
  • The goal: clearly convey what you do, and make them want to ask more questions.

A good elevator pitch should be a summary of what you do that would make sense to a fourth-grader or your grandmother.

Now, easier said than done. 

The Elevator Pitch Formula

The best formula for doing this that I’ve found comes from Crossing the Chasm, and is quoted here:

Here is a proven formula for getting all this down into two short sentences. Try it out on your own company and one of its key products.  Just fill in the blanks:
  • For (target customers— beachhead segment only)
  • Who are dissatisfied with (the current market alternative)
  • Our product is a (product category)
  • That provides (compelling reason to buy).
  • Unlike (the product alternative),
  • We have assembled (key whole product features for your specific application).

Optional Extras

Now, there are still other options for things to add in, depending on the context, with a few being:

  • Why did you start this company?
  • What background makes you the right person?
  • How big is the market?
  • What sort of traction do you have? (number of paying customers, MRR, etc.)

But unless you must, I wouldn’t mention any of those things.  The reason being is that these are all great topics which can be follow-on questions for someone who you get interested with a concise, easy-to-understand, but just-vague-enough elevator pitch based on the formula.

The other thing to note with the Crossing the Chasm formula is that if you have multiple target customers, or multiple reasons why someone should buy your product, you should choose one.

Example Elevator Pitch

So, for Lean Systems, here’s an example of a good, concise elevator pitch:

For transportation companies who spend hours on manual scheduling and routing, we provide an API-based optimization tool that automates the process while providing much more efficient schedules.  Unlike most end-to-end products, we integrate with existing tools so no training or change is required to use our solution.

Now, weaknesses with this version? 

  • We don’t mention who we are, or why we’re doing this.
  • We don’t mention why we’re the right team, or uniquely qualified to do it.
  • We don’t mention the market size (ie. Opportunity) for the company.
  • There are a couple sections (API-based optimization tool) which are too complex.

Out of all those things, I would say the market or opportunity size is the thing you need to mention most.  In most contexts, that’s going to be a big number, and what makes it interesting for investors and others – everyone likes to hear about an opportunity to make a lot of money!

What’s your company’s elevator pitch?

Read about last week (Week 6) here, or read the next post (Week 8) here.