When I first started attending panels and VC events, there was a lot of hype around the concept of an ”elevator pitch”. An elevator pitch is an overview of a new business idea that an entrepreneur can explain to an investor in the length of a chance elevator ride shared by the two parties. In approximately one minute, the entrepreneur needs to bait and hook a VC so that he can reel the investor in later.
At business plan competitions and pitch events, “pitch coaches” spent hours with entrepreneurs sharing with them the secrets of the arcane art of the elevator pitch. And once their disciples were fully indoctrinated, the newbies would get to show off their elevator pitching skills. Most entrepreneurs are trained to pack as much information as possible into that minute, driving most pitches to sound like they were being delivered by the spokesman for MicroMachines.
While there are always cases where stories hyped by the media and entrepreneur folklore do come to life (I suppose entrepreneurs do occasionally share elevators with VCs), this generally isn’t how business gets done. While entrepreneurs can meet investors at networking events, at pitch events and, yes, in elevators, they don’t need to feel that they have to corner the investor and deliver a canned 1-minute light-speed monologue about their business before the investor can get away.
More commonly, when an investor meets and entrepreneur, the former wants to know what the latter is working on and will typically ask. Investors by nature are seeking great entrepreneurs and are therefore likely to be interested in hearing the pitch if they think they are speaking to a credible person. Because the investor is interested in hearing a little bit about the business if it matches their interests (sector and otherwise), entrepreneurs will typically get to describe their business through the course of a regular conversation, not a monologue. You don’t have to trap them and you don’t have to rush.
When asked what they’re working on, good entrepreneurs provide a plain English overview of the company (and sometimes describe the pain point when it’s not obvious). That explanation can come in as little as one sentence. "We’re helping people do X by offering a service that does Y". Typically, if an investor doesn’t get it from your description, they’ll ask some clarifying questions. And, if they’re interested in learning more about key elements of the opportunity (market, competition, etc.) an investor will ask.
In some cases, investors will ask the entrepreneur to send along an executive summary after just hearing the overview of the service or after a few questions. The executive summary is the document that should fill in the rest of the blanks about the business – this document should cover all of the other elements that are often packed into an elevator pitch.
In other situations, the investor will determine that the opportunity isn’t a fit for them and not ask for any more information. That’s an okay outcome for entrepreneurs to – they don’t have to waste time with an investor that isn’t going to get interested.
While I do think you should be able to speak succinctly and intelligently about your business, I don’t think you need to have a canned elevator pitch on hand. Ultimately, I contend that elevator pitches are relevant for pitch events and not much else.
Mark Peter Davis is a New York City VC and member of the DFJ Gotham Ventures team. This post originally appeared on his blog, and it is republished here with permission.
