We talk about the slides, and what they cover, but some of the more important moments in business pitches I’ve seen are not about slides, or plans, but rather about the people themselves, and how they respond.
For example, I posted last week on gust.com about two radically different ways to handle questions about financials. In both cases investors had interrupted a business pitch with complaints about financial slides. One response worked perfectly, and the other was disastrous.
A really good answer
A smart woman had a financial summary slide showing when one of the investors complained:
Those numbers are different from what you show in your plan.
She answered immediately, no pauses, no reflection, as quick as a heart beat:
Of course not. That version of the plan was submitted to your deadline, three weeks ago. We’re not static ever. Things change. This chart is from our latest projections.
That was a total win. Everybody in the room understood.
A really bad answer
It was another financial summary slide. Otherwise the pitch was pretty good, and the founders impressive, but the numbers were annoyingly unrealistic, particularly the huge profitability, something like 50 percent or more profits to sales. Several of us objected. The answer was:
We don’t like those numbers either. They were done for us by an outside financial consultant. We’re looking for somebody to come in and revise them.
Ouch. Throwing some anonymous third person under a bus doesn’t impress your investors. You can’t disown your own slides.
On the other hand, just for a note of paradox, bad financial projections are easier to fix than a bad product/market mix. That disastrously bad answer was not absolutely fatal.