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Well Spaced Bread Crumbs

In the story of Hansel and Gretel, Hansel drops breadcrumbs as he is carted away with Gretel, leaving a trail to follow for any would-be rescuer. This was a good strategy except that bread crumbs are edible. But that is aside from the point of this post, which is that investors need an easy trail to follow when they are brought up to speed on a business opportunity. Each slide is a breadcrumb, and those breadcrumbs must be easy to see and spaced just right.

Entrepreneurs often are so deep in their business that they have trouble spacing the bread crumbs closely enough for the uninitiated to follow. We are asked to make big leaps of logic, are asked to believe assertions with no context or underlying data, questions arise, presentations lose steam, and confusion ensues.

But beware placing the crumbs too close together, or worse, having too many! I am told ten times per month that the smartphone application market is exploding, that smartphone sales are exploding, that cloud computing is exploding, that digital advertising is a really big market, that eCommerce is a really big market, etc. Never waste a slide and bore your audience stating the obvious. You lose momentum, and credibility. Don’t say that digital ad spending is going to $30 billion. Say that, with your business model (that you have all but proven), the total addressable market in the US is $2.5 billion, $5 billion total worldwide. That is my kind of bread crumb.

So, how do you know if your bread crumbs are too close/too far apart? Practice on a friendly audience first. Find a CEO of a venture backed company, cold call him or her, and ask for a critique. I don’t know a single one that won’t take the time to help you out if your business sounds credible. Also, remember that everyone has a pitching style, so you will get conflicting advice. Take in a variety of viewpoints, merge the critique, and then make the pitch your own. Some entrepreneurs create two pitches, one for investors familiar with the target market, one for those less so.

This holds true for sales pitches of all kinds. Knowing what to say to which audience, when to go off script and when to refocus, is truly an art. If done right, you can lead your audience to shared enthusiasm, and, as Hansel did, avoid becoming someone else’s dinner.