People often say the most challenging issue with getting a startup off the ground is attracting investors and obtaining capital. But this isn’t entirely accurate.
The real challenge is being able to convey your idea to investors succinctly, so they understand what you’re pitching them.
Practical Tips for Explaining Your Idea
Some innovations are easier to explain than others. If your startup is difficult for people to grasp, you need to improve how you pitch and discuss the idea. Check out these three tips that will help you help your audience understand what you’re pitching.
- Come Up With a One-Sentence Explanation
The very first thing you need to do is come up with a clean, succinct, and easy-to-understand explanation of what your startup is attempting to do … in one sentence.
There are plenty of different formulas and strategies you can turn to, but here’s one of the best: “My company, [Company Name], is developing [a defined offering] to help [a target audience] [solve this problem] with [your secret sauce].”
You obviously don’t have to follow this formula precisely, but the point is there: Find a way to describe your startup in a single sentence. Obviously, you’ll have to do more than deliver a sentence on the day, but this gives you a strong foundation upon which to build the rest of your pitch.
- Visualize, Visualize, Visualize
Words will only do so much. The human brain is hardwired to process visuals much faster and more efficiently. If you want to articulate your idea to your audience, you should depend on the assistance of well-developed visualizations.
For example, let’s say you’re an architect or design firm that’s attempting to pitch a revolutionary new structure that may fundamentally transform the look of a neighborhood in your town. You can describe the changes, but it’s something else to show your audience what you propose to do.
This is where a 3D rendering tool like Lumion — which empowers you to bring CAD plans to life — comes to the rescue. It immerses the audience in your concept and helps them see it for what it is.
Visualization can also be much simpler. For example, you may be pitching a service (which isn’t as easy to visualize as a building or physical product). In this case, something like the business model canvas could suffice as a powerful visualization for connecting ideas and helping people understand what you’re doing.
- Personalize Your Pitch to Your Audience
It’s a major mistake to approach every pitch situation the same way. Even if you’ve had immense success raising funds from one investor, you should be wary of using the exact same approach on the next one.
People are different and you need to engage on a personal level. “If at all possible, make your explanation relate to the person you are speaking to,” startup founder and investor Diana Kander suggests.
“Has the problem you are solving affected them? Do they know anyone with this problem? The more interactive you can make your pitch, the higher the chances that your audience will be receptive to it.”
Do You Know What You’re Talking About?
It’s one thing to convey a complex idea to a group of potential investors or business partners. But the more essential question is: Do you understand the idea yourself?
Believe it or not, some entrepreneurs don’t fully understand their own ideas. Sure, they can communicate the basic gist, but they haven’t taken the trouble to flesh out the details and connect all the dots to the level that would impress potential backers.
Before you can explain a complicated startup idea to others, you have to be fairly certain that you have an intimate understanding of it from the inside out. Then, armed with the techniques addressed in this article, maybe you can start a meaningful dialogue.