Entrepreneur Office Hours: Issue #192
A new interview and lots of fundraising advice
I’ll kick this issue off with a quick shoutout for my podcast, Web Masters, which just released its 101st episode. That’s a lot of episodes about the history of Internet entrepreneurship.
For those who’ve never listened, I wouldn’t tell you to go back and listen to all 101 episodes (who has that kind of time???), but there are definitely some gems in there worth checking out, including the one that came out this week. It features Taegan Goddard, founder and proprietor of PolitcalWire.com.
Unless you’re a political junky, Taegan probably isn’t a household name in the same way some of my other guests are, but don’t let that fool you. I’ve spent three years interviewing some of the most successful entrepreneurs in Internet history, and I’ve learned that the best stories rarely come from the people who built the Hotmails, AOLs, and Craigslists of the world. It’s not that those entrepreneurs don’t have fascinating stories. It’s that they’ve told their stories so many times — and had so much media training — that the insights they share about entrepreneurship can get lost in the the razzle-dazzle of building, big, billion dollar behemoths.
When I’m talking with entrepreneurs, I’m not nearly as interested in the Forbes version of their story that makes their success sound like a Hollywood movie. I want the entrepreneur version of their story with all the appropriate grit and grime. I want to know what it’s like being in the trenches, grinding, struggling, almost failing… that kind of thing.
Taegan is definitely in the trenches, and he’s been in the trenches for a long time. As a result, he has an amazing amount of dedicated followers, and a successful Internet business that’s probably older than a lot of you reading this. In other words, if you’re looking for some great startup inspiration, be sure to listen to the newest Web Masters episode.
Conversely, if you’re looking for some fundraising inspiration, keep reading the rest of this issue of EOH because, as I was putting it together, I realized it’s entirely about getting investors.
That wasn’t intentional. In fact, I feel obligated to do my duty as an entrepreneurship educator and remind everyone that you don’t need investors in order to build a successful startup.
With that caveat out of the way, let’s get to the fundraising advice…
The emails founders send potential investors can be the difference between getting millions and getting nothing.
Most pitch decks have three useless slides that are making it harder to successfully raise capital.
Office Hours Q&A
I was wondering why, in your article about slides to remove from a pitch deck, you threw shade at Shark Tank. I love Shark Tank!
But you wrote: “If you learned how to give fundraising pitches by watching reality TV, I can’t help you.” Why? What’s so wrong with how entrepreneurs give pitches on Shark Tank???
P.S. Even though you don’t like Shark Tank, I still appreciate you!
I didn’t say I don’t like Shark Tank. It’s not must-see-TV for me or anything like that, but it’s fine for what it is, which is reality television. Just remember that reality television (paradoxically) isn’t very real. It’s entertainment!
The pitches on Shark Tank are a good example because they’re 100% not how entrepreneurs should actually pitch their startups to investors. Specifically, Shark Tank pitches focus primarily on demonstrating the entrepreneur’s product. While that’s fine for TV, it’s not what you want to do in an actual fundraising pitch.
Remember that Shark Tank is more of a marketing strategy than a fundraising strategy. Companies that go onto Shark Tank are primarily consumer products, and the show reaches a huge consumer audience. That’s why companies demo their products. Even for entrepreneurs who either don’t take a deal or don’t get offered one, they still get great publicity and a nice bump in sales.
In contrast, real fundraising pitches aren’t about making sales. Real fundraising pitches are about demonstrating to investors a business worth investing in. The way you do that is by showcasing your traction, your customer acquisition process, and your ability to scale. For the most part, those things don’t even require explaining what your product does.
To be clear, I’m not suggesting you shouldn’t tell investors what your product does in a real fundraising pitch, but it definitely doesn’t need to be the focus. And doing a full product demo is completely unnecessary. Save the infomercial for Shark Tank.
Got startup questions of your own? Reply to this email with whatever you want to know, and I’ll do my best to answer!