Dr. Pinku Mukherjee is a scientist. And when she pitched her blood test for early detection of breast cancer to angel investors and venture capitalists in the 2011 Charlotte Venture Challenge, she sounded like one, too.
I was all excited about the actual technology, so I showed them all these graphs and all the data, says Mukherjee, a professor of cancer research at UNC Charlotte. That didnt excite them that much.
Mukherjees company, CanDiag Inc., took second place in the competition and a $2,500 prize. But she thought she could win it all.
So in 2012, she toned down the science lingo, spoke like an entrepreneur and won the investors confidence and first place in the competition, a $50,000 grand prize.
The technology itself didnt change at all from the year before, but the way we presented it (did), says Mukherjee.
Her story illustrates that to snag investors, you need a polished pitch. Its a message reinforced at presentation-based competitions around the city, from Charlotte Startup Weekend to the Charlotte Chambers Power Up Challenge.
The art of the well-crafted pitch will take center stage again Wednesday afternoon at the Charlotte Venture Challenge finals at the NASCAR Hall of Fame, as finalists try to sway investors to pick them.
But whats the best way to capture investors attention and money?
ShopTalk spoke with Mukherjee and local experts about crafting the perfect pitch:
Prove the need
Experts say every presentation should cover a few key components, such as the target customer, the competition, projections and background on the business team.
But the crux of the pitch is highlighting the need for your product and how you solve it in a way that no one else currently does, says Adam Hill, director of uptown startup hub Packard Place.
Its the same with just about every founder: They get caught up in their idea and get so enamored with their idea, that they just want to be like, Look heres this great thing Im doing, says Hill, who consults startups at Packard Place. Thats part of the pitch, but not the whole pitch.
Hill did similar work at a previous job out of the business incubator at the University of Central Florida. There he offered free consulting to startups and worked with investor groups, reviewing applications and making recommendations.
Talk to your target customers, says Devin Collins, a former entrepreneur whos now the assistant director of business development at UNCCs Charlotte Research Institute and works with the Charlotte Venture Challenge.
Do they need your product or service? And do they need it enough that theyre willing to pay for it?
Hopefully that answer is yes, Collins says. If so, explain your research to the investors to make your pitch more compelling.
Know your audience
Entrepreneurs should have a number of different presentations prepared that they can tailor to their audience, Collins and Hill say.
Youve got your simple-as-possible elevator pitch that anyone should be able to understand, Collins said.
And you should be able to speak on your startup clearly without a slideshow. If youre meeting with a potential investor for coffee, whipping out a PowerPoint presentation on your laptop could be awkward, Hill says.
Then when you get to the more formal pitches in front of multiple investors, you can go more in depth, but still need to spell out the basics, Collins says.
There are exceptions, however. Mukherjee said if shes pitching to a group of doctors, dumbing down the data can be insulting and appear arrogant.
I want them to feel good about themselves and about us, she says. Otherwise, its a no-go.
Prepare for sacrifice
Needless to say, investors want a return on the money they put in, Collins said. So use your pitch to offer projections for when and how much they can expect to see their money grow.
You should also know what youre willing to give up, Hill says, as many investors ask for a stake in the company.
Raising capital is a negotiation like anything else, Hill says. If you go in (to the pitch) with an expectation of someone saying, I want 20 percent and they actually ask for 30 percent, you need to know up front whether youre willing to give that much.
Theres no quicker way to kill a potential deal than to be dishonest with the investors, experts say. So go for complete transparency, even if it makes you uncomfortable.
Between the first pitch and getting the first check, theyll find out if you arent honest, Hill says. And that will absolutely kill the deal.
So dont fudge numbers about your expenses, net income or expected profits, Hill says.
(Investors) are going to ask for your tax returns from last year. Theyre going to confirm what youre telling them, Hill says.
Hill said he saw one company make that mistake while he was working with an angel investor group in Orlando.
A startup company pitching to the group didnt yet have any paying customers, but they did have some who were testing out their system for three months at no charge. The goal was to convert these customers to paying customers after the trial period was over.
The startup leaders told investors that they already had two big companies on board, Hill said. So the investors approached the satisfied customers to get feedback.
The customers actual response? Incredibly lukewarm, Hill says.
Its like dating, in a sense, Hill says. You want to put your best foot forward, but if theres something thats going to kill it, youre going to have the same result, and it wastes a lot of time for everyone getting there.
Pitching became easier
One year after Mukherjees successful go at the 2012 Charlotte Venture Challenge, Mukherjee said CanDiag Inc. has a lab they rent in the bioinformatics building at UNCC, a clinical trial in collaboration with Duke University Medical Center, and two groups of angel investors comprised mostly of physicians.
She and her co-founder, Dr. Rahul Puri, have raised $600,000 for CanDiag Inc. and wants to raise at least another $4.5 million.
And thanks to her pitch training through the Charlotte Venture Challenge and real-life trial and error, she knows what and what not to say when presenting her business to potential investors.
Says Mukherjee: It became easier and easier to make people more connected with (our technology).
WANT TO GO?
Charlotte Venture Challenge is a months-long startup competition through UNC Charlotte with a $50,000 grand prize. This years finals are from 4-8 p.m. Wednesday at the NASCAR Hall of Fame, 400 East Martin Luther King Jr. Blvd. Finalists will give their pitches to angel investors and venture capitalists from around the country. Event is open to the public. Cost is $45. Registration at the door.
McMillan: 704-358-6045 Twitter: @cbmcmillan
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