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7 sure-fire ways to fail when pitching to a venture capitalist

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Investors Dr Vijay Barathan and Dr Gareth King have seen it all in the boardroom. From a two-hour pitch that made little sense to ridiculous valuations and claims, they’ve witnessed the good, the bad and the ugly.

In conversation with Pfizer Healthcare Hub: London, Dr Barathan and Dr King offer their list of things not to do to avoid your pitch becoming memorable for the wrong reasons.

Don’t….

…Say there are no competitors

“We hear this all the time and it always sets off alarm bells,” says Dr King. “It either means that you haven’t done your homework and don’t understand who you’re competing with or it means that others have dismissed the opportunity. You must show that you understand the potential market fully.”

… Refuse to give anything away

“Acting cagey or refusing to share any information can be a cause for concern,” says Dr Barathan. “We’re happy to sign an NDA, but it’s very frustrating when people start by asking for one and are unwilling to tell us anything about proof of concepts or early trials. You must be prepared to explain why an opportunity is exciting and how your solution works.”

…Solve a problem that doesn’t exist

“This is a common mistake,” says Dr King. “If you’re unable to explain why your target customer would pay for a product, it tells us that you don’t really understand the audience or you have tried to solve a problem that isn’t that problematic.”

 

…Stretch the truth

“We always do our due diligence, so it’s disappointing when it becomes apparent that something isn’t entirely true,” says Dr Barathan. “Avoid misleading investors with marketing or presentations that overstate what your product does. If it sounds too good to be true, we know that it probably is.”

…Read out the slides

“Whatever you do, please don’t just stand there and present what’s written on your slides,” says Dr King. “You should use your presentation as an aid, not a teleprompter. Think about how you can use slides to support what you are trying to get across, not as the main vehicle through which to communicate.”

…Stick your head in the sand

“I’m constantly surprised by start-ups that cannot answer the most basic questions,” says Dr Barathan. “You must be able to defend everything. If you don’t come armed with the facts, figures, numbers, and competitor insight needed, and cannot explain how the tech works, you’re not prepared to pitch.”

…Undervalue what investors offer

“It’s not just about the money,” says Dr King. “Businesses often don’t give enough thought to what investors can offer beyond financial capital and what they really need to excel. Think carefully about your long-term funding strategy and exit plan, before considering where you will need support along the way and who is best placed to provide the advice, expertise and contacts that you will require at each point.”

At the end of the day, venture capitalists don’t just invest in businesses, they invest in people. No matter how good your product is or how slick your marketing collateral looks, if an investor doesn’t feel like they can trust you or doesn’t fully understand the fundamentals of the business, they won’t invest. Fortunately, most start-ups get it right and every business has the potential to pitch well.

About the investors

Dr Vijay Barathan is a Life Science Partner at Catapult’s GM&C Life Sciences Fund. He has extensive experience working in medicine and managing life science investments. He holds a degree in Medicine and a BSc in Development Neurobiology.

Dr Gareth King is a Life Science Partner at Catapult’s GM&C Life Sciences Fund. He has a background working in and leading life science start-ups, including Critical Pharmaceuticals, Pharmaceutical Profiles, and Cyprotex. He holds a BSc in Microbiology from Sheffield University and a PhD in Molecular Genetics from Edinburgh University.

Pfizer interviewed Professor Marc Clement ahead of the upcoming Pfizer Healthcare Hub: London event where he will be part of the judging panel to select three winning health start-ups.
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