The previous posting observed that for all the hype of start-ups – around the global and specifically in Israel’s Silicon valley – between 30-50% do not make it. One way to pitch successfully to investors is emphasise the ‘why‘ of the project. People tend to buy in to your vision and dreams rather than fantasised markets and wow tech.

That still leaves a conundrum: How to present the ‘why’ in a convincing manner? Enter Yochi Slonim, a successful serial entrepreneur, who has been marketing, creating, managing and selling high-tech starts in Israel for nearly two decades. And for all that, Yochi poses a very simple question. How is it that in 99% of all presentations, when a CEO enters a room, backed by a great team and tech, the viewing panel of investors concludes with “thank you, keep us informed and good luck”. What is the cause of the continual misfit, which Yochi himself has encountered on hundreds of occasions?

In a recent appearance at the Jerusalem Business Networking Forum, which I had the honour to moderate, Yochi gave the answer under the title “startups are from Mars, investors are from Venus“. The core point is that both sides have similar goals, but they are seemingly located on different planets. They look at the universe from very different perspectives.

Yochi gave several examples of the misfit.

• An entrepreneur often explains to an investor how they can be the first to be part of a “new generation” of whatever. Actually, investors tend to be cautious people, and thus they want to hop on to wave in second place. I am associated with a biotech project where that is the common response, for now.
• Similarly, when outlining a classic SWOT analysis, an entrepreneur is happy to talk about the “Opportunity”. The market is mega large etc etc. In fact, many an investor will read / feel / internalize the word “risk” in place of opportunity. And most investors are risk-averse.
• Innovators often talk about the past experience of their small team in large corporates, when they should be concentrating on relevant skill–sets acquired over the years.
• Entrepreneurs become so intent on securing revenue from their tech that they ignore the fact that investors tend to seek multi-revenue possibilities in order to minimalise risk.

So what does this add up to?

When an entrepreneur explains his dream, why people should believe in him, he or she needs to know his audience. Obvious, no? But how many of us truly answer the question before we open our mouths for the first time in a meeting?