demo pitch deck fundraise

How to do a demo in a venture capital pitch

Tl;dr: How to deliver a product demo in person in a VC in a pitch. Record it, talk to it, keep it short, make it emotive and relatable

VCs want to see your product demo. The earlier stage you are, and the less metrics you have the more important this is. If you are growth stage, no one cares. You have numbers.

Early stage your product demo shows you have actually shipped something. This is important. It’s the ultimate show don’t tell (Check it out vs trust me we can code good).

So if you do a demo in person, what needs to be in your deck?

You need to have a product slide in your deck, but you want to keep things on your product simple. What I do is a slide which shows the ‘4 things it does’…. the key ones anyway. You just want to explain it at a high level so an investor gets the core and want a meeting to learn more.  You can demo in a meeting… once you get one. You are going to share your deck before a meeting (most of the time) so a simple overview of your product is a very good idea.

Here is how I do it with my clients at Perfect Pitch Deck:

I’m going to run you through how to give a demo, and what not to do. Like all my advice, it ‘always depends.’ It depends on how much you have raised, if your product sucks or is well developed, your growth stage. If you aren’t an idiot you can fill in the blanks to extrapolate how these tips will apply to you though. Most applies for all startups.

Let’s start with a story like all good pitches

Imagine you have started a burger joint and are raising money to expand. You could talk about how people like to eat, that burgers are great and that efficiency is a driver of margins that others have missed out. Do you know what, I’ve fallen asleep and the whole special sauce fell on deaf ears? Sometimes seeing is believing.

If you haven’t seen ‘The Founder‘ movie, this is what I’m talking about. A parochial company founded by two brothers with the surname McDonald had radically innovated in their business model and value proposition. It took someone called Ray Croc to go to their burger joint, see how what they were doing was radical and the scale of the opportunity, though let’s be real, the ‘founders’ weren’t pitching. I’m squeezing in an example to fit a dramatic method, but it’s good enough that I don’t care.

Image result for the founder

Ray: Give me a hamburger, a french fries and a coka cola

Server: Thet will be 35c please

Ray: Alright

Server: 15c is your change [3 seconds later]

Server: Here you are

Ray: What’s this?

Server: Your food

Ray: No, no no. I just ordered.

Server: And now it’s here

Ray: You sure? Alright. Where are the, you know, silverware and plates and everything?

Server: You just eat it straight out of the wrapper and then you throw it all out

Ray: Ok…

Mind fricking BLOWN!

When you see something amazing despite the founders being crap at pitching, you know there is an opportunity.

Sometimes you just need to see it.

What to do

FOCUS

Only show the absolute core and key things you do. No one wants to know everything. Your attention is inversely proportional to time here. The more you share the less people care. The more features you show, the less important they seem.

Tell a story from the perspective of a typical user

You could just show your product and rattle off mechanically how that works, and that’s fine, but you can do more. Remember you are in a sales meeting and you’re selling your company (Not your product).

Everyone loves a good story. What if you explained your product in terms of how your users experience and benefit from your product? Investors can attempt to empathise with your customers and feel a deeper insight into your product with nuances of how you built it. Better yet, why not role play? Pick a real customer called ‘Mary’ and explain the problem she has automating her inventory. Then show how Mary uses your product to spend more time on her business? It creates context.

If you focus on technology you get a bland feeling. If you explain your product in the context of real pain, your tech means something.

Provide context to show how it fits in the world

You are showing features and providing the context of how users use it. Why don’t you add more insight and chuck in ‘the competitors don’t do this and why.’ A demo is a great opportunity to position yourself against the competition.

If there is some industry trend or new technology, you can show how your product is capitalising on it.

Record your demo, don’t do one live

Stuff goes wrong all the time. Wifi doesn’t work or the projector isn’t working… whatever, add something that will mess up on the VC office side.

And then my favorite… this happens more than you can believe… your server stops working just as you are doing a demo. I crap you not. I have had so many founders tell me this. Some dev ships an update without telling you and well… you know Murphy’s Law. ‘Ummm…. sorry the site isn’t working right now.‘ #FAIL

Do this.

RECORD a demo of your product. You get the opportunity to think about how to convey the key functionality succinctly. You then play the demo with investors.

You either:

  • Pull out a laptop and pull everyone in close like a camp fire
  • Stick it on a projector (if they have one)

But I don’t mean a full record, as you don’t use audio! I’ve explained the audio bit in the ‘what not to do section‘.

Since you are recording, you can also edit the video so you can pull out all the ‘boring bits’ like logging in, setting up a user account  (unless that matters). You can streamline it to the ‘good bits’.

Practice

Since you are going to record your demo, you need to practice, practice and practice till you spill out the story verbatim without thinking. Once you know exactly what to say, you can easily adapt your story to the investor, emphasizing certain things. You can pause the recording too.

When you really know your story you can focus more on having high energy and passionately telling it.

The best way to know if your demo sucks is to test it on people. Start with friends and then find a stranger. If you are a knob blowing money in We (pretend to) Work, then you are in a target rich environment. Make sure you are eliciting critical feedback. Nice words don’t help you. This is why I’m so direct and frank when I do consulting with founders. Do you want to feel good for a few seconds with fake feedback, or do you want an ass kicking now so you have a better shot with investors? Yeah, the later. Get funded.

Leave em’ wanting more

A good demo is just that, a demo. It’s not a deep dive. Continue your Millenial insta life and only give a glamorous glimpse into your ‘life’. Leave them wanting to know more. You are likely in your first meeting and you have a time limit. Make the demo on a few minutes long including storytelling. Get back to the rest of your pitch as soon as they ‘get’ the basics of what you do. You can give them access to your platform, or do a longer separate session if they are interested in more meetings.

What not to do

No audio

Do not play a fricking video with audio. Don’t sit back and think  VCs love it like ‘movie time’ when you were in high-school. The VC is going to think or say ‘Why am I watching a video? I could have watched that on double speed whilst reading emails.

You TALK to the demo. You explain what is going on so you keep the whole experience personal and the attention on you. You can pause it if there are any questions. If you need to, you can adjust how you talk to the video.

Do you get it?

This is really important.

Don’t add a ‘demo’ interstitial slide

Have a slide in your pitch deck which explains your product, but just a bit. VCs just don’t care right now. They just want to ‘get’ what you do and see a bit of it.

Don’t do what a lot of founders do which is have an interstitial slide which has nothing on it other than ‘demo.’ Screw that. Such a waste of attention (and a slide).

Don’t show me everything

Seriously, VCs don’t want to buy your product, they want to buy into your idea. They want the intro. The basics.

Founders go wa wa and walk through a fricking list of each and every feature… snore. VCs want to figure out very different things than you think they do. You think product, they think commercials. “What is the value to clients?” or “why the heck would somebody keep using this?” and you are banging on about things like how you can also work with CSV uploads. No one gives a crap.

Get someone else to demo

VCs expect the CEO to be the ‘greatest showman in the world.’ You are going to be doing all the early sales and so should know the product. If you say ‘I’ll get Jim to schedule a demo with you, I’m not very good at that‘ there are alarm bells ringing. How the heck do you not know your product? This is a huge red flag!

Don’t start with a demo

You are demoing your solution to a problem, not ‘cool tech.’ If the investors don’t understand the problem they aren’t going to ‘get’ your solution and why it matters.

If an investor asks to have a technical meeting and for you to have your lead engineer, you know you are there to talk tech (just don’t get brain raped – watch silicon valley on that).

A commonality I find a lot writing pitch decks is that founders fail to grasp that investors are commercial. They think about making money and that means big market, timing, monetisation, churn bla bla. It’s not Google AMP, PHP 7, Sharding, Angular, nor feature, feature, feature that makes you a great business.

Conclusion

Do all the basics here. How it goes down is going to depend on you. Try keep the attention on you as much as possible, they can see the demo but you are still building rapport with the investor. Demo the commercial implications, not cool tech.

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