Transcript: NZ8 Bill Reichert
There are six videos in the Bill Reichert's NZ8 series.
Read the individual video transcripts by clicking below.
View the videos here
Introduction to scale up
We have shared a lot of knowledge in the venture community about what it takes to start up a company, right? So, there are now accelerator programs and educational programs and training programs and books and curricula on how you start up a start-up. But what we haven’t done a very good job of sharing with entrepreneurs is the transition from start-up to scale-up and, in fact, you have to stop doing some of the things you’re doing in the start-up phase and start doing different things in order to scale-up. You have to change your mindset of going from an exploration type of process into an execution type of process. You have to change your skillset, you’ve got to build a team that has talents that you, as founders, probably don’t have, and you’ve got to bring them in and help them be successful and you’ve got to change your processes. You know when you’re in the start-up mode you don’t have to have a lot of processes because you don’t know what to pin down. But in order to scale-up you’ve got to build out these repeatable, scalable processes...
Pitch with purposeWe try as best we can to help entrepreneurs develop their pitches, and so out of the goodness of our hearts we’ve all developed templates, you know the perfect template for how to structure your pitch. So, every blog, every video, every book, every pitch coach has the perfect template. The reality is that no template was designed to fit your company exactly. So, every company has a different level of key challenges and priority milestones they’ve got to hit, and what’s key for each company is to make sure when they’re communicating their company that they knock down those key challenges in order of priority. So, for some companies the issue may be the big competition they’ve got to overcome. You can’t wait till Slide 6 to talk about competition if that’s the elephant in the room that everybody’s thinking about when you open your mouth. But in another company it may be the regulatory challenge. In another company it may be “How are you going to get adoption of your technology into other people’s products?” So, depending upon the challenges that are critical for you to knock down to be successful that’s how you should structure your pitch. You can use templates as guidelines, as checklists to make sure that you cover the key points but never rigidly adhere to anyone’s template; it wasn’t designed for you....
Don't talk about productSo a big challenge for most entrepreneurs is when they’re starting up their company they’re focused on building something special, you know a really cool product or service or technology, whatever it is. And so as a result entrepreneurs, when they talk about their companies, they start to talk about their product, they start to describe their product. But what we want to hear is not about their product; what we want to hear, if we’re a customer, if we’re their potential employee, if we’re a partner, if we’re an investor, what we want to hear is a compelling value proposition. And what that means is that you understand what value you create for your customers. So, it’s about, you know, trying to pitch an investor that you’re going to make them money, what investors care about is that you’re going to create value for customers because that’s what sustains a successful organisation. But most entrepreneurs are not very good at framing their message in terms of value. They talk about technology, they talk about product, but they need to focus on how they make the world a better place for each and every one of their customers and why it is that every one of their customers loves their product and cannot live without it. That’s what gets people’s hearts racing.
Pitching to the three body partsMost entrepreneurs when they think about making the pitch they focus on creating a logical evidence-based, data-backed argument, that that’s their pitch. But what we know is that you can’t just appeal to the head, you have to appeal to three body parts. You’ve got to appeal to the head. What you say has got to be clear; it’s got to be understandable. But that’s not good enough. You also have to appeal to the heart, right? You’ve got to get people’s heart racing if you’re going to differentiate from all those other pitches that customers are hearing and investors are hearing. The way you differentiate is by getting them to say, “Wow! That’s amazing. Tell me more.” And the only way you can get them to say, “Wow!” is to excite them, to get their heart beating faster. To say something that makes the investor fall in love with your company. But you also have a third body part; you’ve got to appeal to the gut, right? We all have a gut reaction to everything we hear and every person we meet. So you’ve got to come across as the kind of person I can trust. You can’t come across as a sales guy pushing something down my throat or hyping something that I don’t believe. So you’ve got to pass the gut check.
Conflict is goodWhen I was an entrepreneur and I did four different start-ups I thought it was really important to maintain harmony and happiness inside my organisation. And I thought whenever we started arguing that that must be a bad thing; that argument must be dysfunctional. But what I’ve learned over the years is that in high-performing organisations frequently there’s a lot of tension and conflict. And I was trying to figure out “How can that be good?” And what I’ve realised is that there’s a thing called creative conflict whereby bringing all these different perspectives into the room and thrashing and throwing things out you make better decisions. So, the challenge is if you’re going to bring all these different perspectives into the room and give them a voice how do you reconcile the conflict? That’s the trick that a good entrepreneur figures out. And the key to that is making sure you have explicit shared values and norms in the organisation so that when you’re arguing you’re not arguing against each other, you’re arguing as to how you are going to best achieve the goals you have as an organisation, and that takes it out of a personal argument and into a problem-solving conflict.
Pitching is not presentingSo, one of the challenges entrepreneurs have is there are a lot of pitch coaches out there that are teaching them how to do presentations. But presentations are actually different than pitches. Pitches, you’ve got to get your message across in like 20 seconds to get permission to say more. So, when you’re pitching you’ve got to cut right to the value proposition. So, what you can’t do - most pitches say, “Start with the problem.” You don’t have to start with the problem. If you make it clear what your solution is, if you make it clear what your value proposition is almost everybody who’s listening to you knows the problem you’re solving, right? So, we cure cancer. You don’t have to explain that cancer is a problem, right? We eliminate pollution. You don’t have to explain that pollution is a problem. So, you don’t have to start with the problem. Cut right to the chase. Tell us what your solution is and tell us what’s compelling about your value proposition.