How Pitching Investors is Different Than Pitching Customers - Michael Seibel

Summary

Pitching investors and pitching customers require different approaches. Investors are interested in the potential for building a big business, while customers are interested in whether the product solves their specific problem. It is important to have separate pitches for investors and customers, even in the early stages of a company.

Intro

Michael Seibel, a partner at Y Combinator, explains the difference between pitching investors and pitching customers.
Pitching investors involves convincing them of the potential return on investment, while pitching customers focuses on the value and benefits of the product or service.
Investors are interested in the market opportunity and the team's ability to execute, while customers are more concerned with the product's features and how it solves their problems.
It is important for entrepreneurs to tailor their pitch to the specific audience and address their unique needs and concerns.

Difference between investor and customer

Pitching investors is different from pitching customers because customers are personally interested in the solution to their problem, while investors may not have the same problem and are primarily interested in the potential for a successful company.
Customers are looking for a solution to their problem, while investors are looking for a profitable investment opportunity.
The same pitch may not work for both customers and investors.
Customers are driven by personal needs and desires, while investors are driven by financial returns.
Investors are interested in the long-term growth and profitability of a company, while customers are focused on immediate benefits.
Understanding the different motivations and needs of customers and investors is crucial for successful pitching.

Talking to customers

Establishing credibility and understanding investor problems are key when pitching investors. To do this effectively, use industry-specific language and let investors speak about their problems. Highlight how the solution can personally benefit them.

Where to use your customer pitch?

Sales calls
Front page of your website
FAQ section
User interviews
Other relevant situations

Talking to investor

Avoid using jargon and marketing language when pitching to investors
Use clear and concise language to explain what your product does and how it solves a problem
Provide concrete examples and relatable explanations to help investors understand the value of your offering

Where to use your investor pitch?

The investor pitch should be reserved for your pitch deck and not used on your website or when talking to customers.
If your website and pitch deck are saying the same thing, you may be doing it wrong.
Your product should assume that the customer is also a user.

What investors care about?

Investors care about several key factors when considering a startup:

What the startup does
Stage of development
Customer base and growth
Size of the market
Pricing strategy
Unique insights or advantages in the market
Capabilities of the founding team

What customers care about?

When pitching to customers, they care about the functionality, onboarding process, and pricing. They want to know if the product solves their specific problems. Customer conversations involve discussing screenshots and live demos. When pitching to investors, the focus is on market size, demand, and potential customers. Most companies advised to have separate pitches for customers and investors.

Summary

The key points of the text are:

Pitching investors and pitching customers require different approaches due to their different motivations.
Investors are interested in the potential for building a big business.
Customers are interested in whether the product solves their specific problem.
It is important to have separate pitches for investors and customers, even in the early stages of a company.

Outro

The outro is the final section of a piece of music or a performance, serving as a conclusion or ending.

The outro is typically used to create a sense of closure and bring the piece to a satisfying end.
It can include elements such as repeating musical motifs, fading out, or a final chord progression.
The length and style of the outro can vary greatly depending on the genre and intention of the music.
Outros can also be used to transition between songs or sections within a larger composition.
They are often carefully crafted to leave a lasting impression on the listener and enhance the overall impact of the music.

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