Be Strong & Listen

Brenden Kumarasamy

Devin Miller

The Inventive Journey

Podcast for Entrepreneurs

8/27/2020

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The Inventive Journey

Starting and growing a business is a journey. On The Inventive Journey, your host, Devin Miller walks with startups along their different journeys startups take to success (or failure). You also get to hear from featured guests, such as venture firms and angel investors, that provide insight on the paths to a successful inventive journey.

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best founders i've seen or have a very strong point of view what they believe but they listen to everyone else's [Music] [Music] hey everyone this is devin miller here with another episode of the inventive journey i am your host devin miller the serial entrepreneurs built several companies to seven and eight figure businesses as well as the founder and ceo of miller ip law where we help startups and small businesses with their patents and trademarks and today we have another great uh expert episode we're gonna have you know we tried each week we have our normal episodes where we go through the journeys of different inventors and then we have experts come on every week as well and talk about different skills that may be helpful for startups and small businesses as they're trying to whether it's raise capital or grow their business and otherwise navigate that that journey to success so um today we have brendan and he'll give a much better intro about himself but it's just as a quick intro so brendan does a lot of whether it's youtube videos um publicly speaking engagements and helping and coaching people on public speaking and it was uh kind of we had him on the episode today because a lot of you guys that are startups and small businesses are looking to do what i would say public speaking but in a bit of a different platform which is when you're going to angel capital or venture capital or angel investors or any of those type of things you really need to be able to present your much like public speaking present your invention present your idea present whatever your project is whatever you're asking for money for in a way that's going to resonate with a public speaker so brendan's going to come on and help us understand a little bit better about how to make sure that you convince people to invest in your company when you pitch it to them so welcome on to the podcast of course thanks for having me it's great to be on so i gave a bit of an intro and we'll dive into what makes it or how to pitch it but maybe if you want to give a little bit of your background and what makes you qualified to talk on such a great a great uh great topic and then we'll jump into it a bit yeah for sure happy to do that so i'm the founder of master talk i make youtube videos on public speaking communication and how i got started was when i was in university i used to do these things called case competition so think of it like professional sports but for nerds so other guys my age were you know playing college football or something i was watching presentations and i was competing in presentations so in three years i did one year in venture capital presented over 500 times coached a lot of entrepreneurs mostly in the tech space and then after i got a job in corporate i kind of asked myself what can i do to make a bigger difference in the world and i realized especially in the context of technology that a lot of technical founders are really smart very customer obsessed know what they're building but have a lot of trouble communicating those ideas in a way that somebody who doesn't understand their technology stack can help them with an introduction or a raise or something of the sort so i started master talk to democratize the information and share it with the world all right no that's a great intro so now with that as a back said i said the stage and you said it even better so let's talk a little bit about kind of so if you were to take a lot of our audience and people that listen to that are going to be either just starting out the startup maybe they just have an idea and they're going to cultivate it and then go pitch it or they've done a precede and now they're going for the seed round or that but what are some of the things that they should be aware of or the ways that they can better pitch or present their to present their idea their their deck or whatever it may be so that they can convince investors to invest in their company yeah absolutely devin i think a great way of starting this conversation is to talk a little bit more about what is a pitch and what is it for and a lot of people make the mistake of thinking that a pitch is just a presentation you know you're giving a pitch and then the pitch is over but we need to realize that as entrepreneurs pitching is an everyday thing we pitch to everybody investors employees that we want to recruit into our companies customers that we want to buy from us and potentially venture capitalists late stage investors every single stakeholder whether it's the person who's organizing the event to the person who invests in your company they're all being pitched to because they're all necessary to make your vision as an entrepreneur come true so the first exercise that we all need to think about before we even get into the five-minute pitch in the seven minute pitch is what i call the one sentence exercise most technical founders especially have a lot of difficulties summarizing their entire business in only one sentence so i'll give you an example one company i worked with called in vivo ai so what they do essentially is they're an ai startup that helps circumvent the drug development process and save a lot of money let's just say the the business is a lot more complicated that i just explained you know these toxicity datas and they parse the data and all that stuff and it's super complicated but even for a company like that they're able to simplify their business in one sentence we're an ai company that helps save big pharmaceutical companies money on drug development costs so it doesn't really matter how complicated your business is you need to be able to explain it in a way that your mom understands it that your grandmother understands that your grandfather understands and if you can do that it's much easier for you to enroll people who don't really understand who you are what you're trying to accomplish and what they can do to support you okay so so you and so how do you go about because and i'd agree because a lot of times you get a technical person especially if it's a technical sometimes it's easier if it's a marketing person if it's that founder because they're used to maybe doing that pitch more but you get a technical founder which a lot of people are they have a great idea they want to develop it and then i would still say you know the best person to pitch the product is a founder if the founder can't pitch it you're not going to just bring someone on that's a rainmaker that's going to make it happen because you're the best one when did you get into that question and answer session but you're right in the sense of my experiences probably mirrors what you said a lot of times you don't you can't succinctly say what your product is or why somebody needs it so what is the way or what's the tips or how do you help people or what or how should people think about simplifying what their company is into that one sentence absolutely so the easiest way of doing this is to just talk to your your favorite fans like you're raving fans the people who use your product people love you those are the best people who are able to explain your business to them so let's take airbnb as an example sure you can say airbnb is a marketplace for buyings and sellers that exchange real estate assets temporarily to make a profit and for the others to provide accommodation or you can just say you know airbnb is a platform where you can rent out the extra room in your house for money right it's just it's a lot more simpler but that language usually comes from your customer because when you're when you talk to your customer who's an airbnb host they're not going to tell you you know this marketplace allows me to exchange real estate assets this is really interesting thanks for i just said you know you know let's say he's talking to ceo you know brian chesky it's great i get to rent out the extreme my house make some money and now with that extra money i get to live a better life i get to provide for my family so when when the ceo and the founders are listening to that they're like oh that's the story you know airbnb is not just about renting out rooms it's about creating a world where everyone belongs and by using that world as an incentive for them to enrich themselves like make money and and provide more opportunities for everyone else around them that's how airbnb was able to develop its brand ethos from talking to its favorite and most loyal fans so i'd highly encourage doing that and it's going to be much easier because your customers will never describe the business and the way you would because you're very deep into it whereas your customer isn't they're just using your service okay no i i think that makes good sense and i think that you know so i'll ask one follow-up question and then we'll dive on to the next part of it so once if i don't know because what is if i don't know what my product if i don't have customers yet right so let's say i'm pre-revenue or i'm getting ready to launch and you have some companies pre-avenue there's to go the reason they're going out to angel you know angel visitors or venture capital or whatever is to get the money to develop the product right so they don't have that luxury of going out to the clients or customers and saying you know hearing their feedback and helping them hone their message so if that's the case then how do they get to that one sentence right so so even in those situations that's kind of like a middle ground there i think it's really rare where you you can raise money without anything right but i think unless you have like some sort of business plan what i would recommend is if you can't talk to your customers usually think about who you want to be serving and why you want to be serving them so one example is let's say your airbnb you want to rent out rooms in somebody's house but you don't you don't really have customers you're still pre-revenue the next question is you need to figure out because you there's some insight that you're operating on as a founder you're not just going into this blind or else you know the chance of you surviving is not very high anyways but let's just say you have that dream state what you want to be doing instead is talk to future customers potential customers people who could become because i always believe that obviously you can figure out amongst yourself too it's just the reason why i don't recommend it even if it could be efficient is because it's just easier to get the messaging from the customer first or else you'll just be stuck into this group think mentality where this guy's the cto i'm the ceo of this company we know we're right and then we send a message and then half the vcs are sitting there like so what do you do like i don't really understand right and then everyone just gets lost so i would recommend that or just have conversations with other people you can talk to potential board members that you want to have or potential advisors or just groups of people that you think would be a good fit for this product or service okay you know i think that makes and i think that some even if you talk amongst yourself sometimes you still get it too convoluted or it's not succinct it's not right and probably in a sense and when i do it on the patents and trademark side kind of similar in the sense that you know when we ask somebody what's unique or different about your product or that a lot of times they are so familiar with it they worked on it so long and they know it so well that they say well nothing you know it's there's nothing really that unique about it it's what we've done is pretty obvious and they dive into it and it's not and the same kind of thing is you're been with it so long that you start to look at it differently or you're not able to explain it in a way to somebody that's not familiar with it would understand it so i think that's that's a valid point so so let's say you get the the one sentence you do finally boil it down to the one sentence and now you have to give the rest of your pitch and it's still convincing unless you can if you can convince somebody off of one sentence to invest in your company you're doing awesome but assuming that's not the case then what's the next step or what would be the next tip as far as to make a in a good pitch to an investor yeah absolutely so the next three things that we need to think about are which essentially is what's going to get people excited about your your business and the opportunity that you have so the first one is what we call traction so traction means how fast are you moving so let's say for example you're building an app right you've taken five years to develop a first iteration this tells us from a venture capital perspective that you're not moving fast enough to get to where you want to be to get to the solution which whichever is the right one because in startups you're always moving quickly so you want to show i'm sorry with the easiest ones then we go to the hardest ones like product market and all that stuff is you want to show that you're moving extremely fast you know we started the company in january 2020 we had our first mvp ready in march of 2020 or some sort of timeline that shows that you're not just sitting around and doing nothing that's the first thing the second thing is what i call a unique insight what's your secret sauce so what gets venture capitalists really excited is when you tell them something that they don't know about the market so let's say for example you say that these competitors are doing less and this is why they're going in the wrong direction but rather the solution is this and you explain it very well then venture capitalists get really excited because it's something that they go oh i never thought of that but instead if your unique insight is something that we already know something that's obvious that it's probably not a great idea because somebody else has already done it somebody else has already done a great job with it right so that's the next thing that you want to think about besides traction is what is the insight that you're operating on so i'll give you another example so if you think about airbnb as a platform the reason why the timing for the platform was so great was because they started the company during a recession so it was the perfect timing for them to increase the number of hosts on the platform because a lot of people started losing their jobs and they saw airbnb as a way to make supplemental income that's one side the second side of the equation is a lot of people grossly underestimated the number of people in the market who would be willing to go somewhere else to a stranger's house and pay them money why because hotels were just so exorbitantly expensive that some segment of the market was willing to do that and then the third thing that just a lot of vcs missed that airbnb got correctly in their thesis is that airbnb wasn't just serving underserved you know poor communities there was also a space for them to sell very high margin properties and rent out tree houses and castles and it's at a very high margin so there's a lot of things we can go into but the idea is simple you want to talk about the inside on the market that most people don't have and if you're right about it then venture capitals are going to run after you and then the third thing which is you know obvious but it bears repeating that's why i saved it for last is what problem are you actually solving you know most people whenever they build a product and which surprises me when they start a startup they're not basing it off of a singular thing or singular 10x improvement in a product that somebody's currently challenged with and if you don't have that 10 x increment or even 100x increment it's really difficult to justify venture capital funding because you need a very high return for the investment if if your problem is correctly solved so i do if i remember right first one is is give them a timeline or timeline is that right is that the first one give them a timeline of how long you've been developing it and how long you expect to get to that whether it's minimally viable product or map on the marketplace or something of that to give them an idea of what they're this isn't going to take forever and that you have been working on it that's the first one you got it just to add more layers attraction also means the number of users and how quickly that's growing think about the first check in facebook peter thiel only invested in zuckerberg because of the growth that facebook was having you guys was the 19 he was super nervous he had a terrible pitch but theo saw the growth curve so we invested in the companies you also want to show that especially if you're a sas company or if you're a technology startup working on an app okay so that one's the first one if i remember second one is or kind of your unique perspective how the market is thinking this one way and you're saying that's there they're all thinking the wrong way and this is the way they should be thinking in this and that almost dovetails into the third one which is now this is how we're solving that problem uh here's the wrong perspective here's our perspective and then this is what we're implementing to do that and it will create a 10x return or 100x return or a larger return such that it makes it investable is that right and one last thing once again stating the obvious but just add value here inventor we only invest in big markets so let's say for example you know you got this amazing product it's revolutionary but you're you can probably serve 50 million like revenue like that's how big it can get that's a great business right that's an amazing you know small business you should go for get a loan at a bank but that's not venture backable because venture backable startups means that you're shooting for a much bigger you're trying to build like the next unicorn you're trying to build a hundred million dollar business so only in those situations do you want to take venture capital funding because the returns just aren't good for for a vc because they would take a lot of risk for a lot of upside but obviously that's obvious for people so i won't go too much into that well i don't know i don't know how obvious it is because i think a lot of people think that if i go to an angels are a little bit better but they they still have that same expectations although they're willing to take you know oftentimes angels are willing to take a higher amount of risk right they're saying i'll come in earlier but i also want an earlier upside whereas venture capital at least my understanding correct me if i'm if you think differently is you know venture capitalism they want to see some traction they want to see it further out in the marketplace they wanted to be somewhat de-risked or at least have more proof angels are a lot of times coming in a bit earlier but i think some people don't or simply say hey this is going to be a good business therefore it's investable there can be a lot of good businesses that aren't investable in the sense that it doesn't give that 10x to that 100 eggs it may give a two or three x which is a great company for a lot of people it just isn't one that's necessarily investable that's it you got you got the right idea here right so what one good way to think about venture is it really depends on the rounds so let's say you're a late stage investor then metrics matter like you need to have raised like millions of dollars already you need to have a lot of revenue going but there's also venture which is the venture firm i used to work yeah which was what was pre-seed seed round so we wouldn't really pay attention to the metrics but we did want to see your product we did want to see some traction we did want to see some indication yes as an entrepreneur we would never invest in just a pitch deck or an idea especially even at the precede stage okay so now i'm going to switch quest or switch gears or avenues just a little bit so let's say you have an investor or sorry not an investor a uh founder a co-founder someone's in the startup that's going to go do the pitching and they understand what we just went through as far as the one sentence they get the three their three points and yet they're just what would be all terrible pitchers they're terrible they get nervous or they get anxious or when they you know when they get asked a question that they don't know they're not quick on their feet how do you get you know so is it simply that those people those type of people shouldn't be pitching it and they need to find someone else or how do you get to where you're in a better spot to say hey i do get nervous i don't think quick on my feet i get when i get asked a question i freeze or something and that how do you start to overcome those absolutely and that's the reason why i started master talk right so to provide all of that free information for people to learn how to pitch and not just what to pitch in the deck but what i would say is the way that you go through this is by two ways one is you want to bullet proof your presentation it doesn't matter how shy you are as a founder if you present that slide deck enough times and there's enough people in the room who are willing to ask you hundreds of questions that just bullet you down after you've answered 300 questions when an investor asks you a question you probably already know the answer right so what i do and i recommend you all do this too the people who are listening is once you're done your pitch the next thing you want to do is get feedback right away get 10 people you don't like 10 people are really vicious and get them to ask you a bunch of questions not investors just people that are really critical that when they when they go through your journeys they like to pick everything apart yeah exactly yeah you'd be perfect for this and then what happens is when an investor says hey did you think about this you said yeah i thought about it because this person asked me that already right so your confidence starts to skyrocket the other thing i'll say is what i call the repeatable presentation what the best speakers in the world don't tell you is that they only present one or two presentations but they do it hundreds of times so of course if you have a demo day in a week and you just made your pitch deck you're going to be nervous and it's it's going to be hard to turn around but if it's your 50th demo day if it's the 25th time you're pitching i mean you're not changing businesses or at least i hope you're not right it's the same business over and over again well you probably know a thing or two about how to simplify it you probably know how to explain this and at some point it becomes like clockwork it's not scary anymore because you're presenting the same thing over and over again so that's the two things i would say okay no i think that's good and i think that a lot of times the only thing in uk again you're much more of an expert so it's a statement slasher question is do you do you run a risk so if you do enough of a presentation i get i agree that you get comfortable with it right so you get you get first of all you get and usually even if you have somebody peppery with questions there's still the possibility that somebody will ask you a question you haven't anticipated and i think again you can correct me sometimes it's okay to simply say i don't know her that's a great question let us go back and look at that or let us take a look at that and obviously if it's a foundational question to your company you should know it but if it's something that's off the wall is sometimes it's better to say i don't know or let me take a look at that as opposed to try and make something up on the fly but the one that wasn't the tangent or side but the one question i had was if you does there run the possibility if you rehearse through your pitch deck too much or you rehearse it too much or you do it too often that it almost sounds a wrote script or it sounds you know almost machine like or it sounds like you don't really care you lose some of that excitement or that you know that emphasis on some of why you're there does that ever happen or how do you deal with that right and it depends on how you approach it so let's say for example you're presenting the same thing again just for the sake of presenting it you're like man if brandon told me to present 25 times a percent 25 times why am i still at the same level this this things but the way that you want to think about it is by asking yourself the following question which are different set of questions so let's hear the seventh time you presented it you're not talking about content anymore because you know your content so now the question comes up is what emotions am i conveying in this slide what does my audience think of this slide and then you start to get obsessed with those little details and that's how you avoid being more robotic but rather exponentially better than you were the first time the only difference is the set of questions that you ask but if you're just going through the motions and presenting it over and over again and expecting it well that doesn't work right so instead what you want to do is just say how can i make number 25 better than 24 and just give an idea here my keynote that i present to people i've presented over 300 times and i still present it five times a week and it's the same thing every single time but it doesn't feel robotic because i force it not to be because i've thought about the emotion oh i want to do this i want to do that and to you that might seem boring but to the audience who's hearing it for the first time you're like this incredible world-class speaker that's what i want for everyone okay so now i'm gonna i'm gonna switch gears yet again or ask a different question so how do you deal with the opposite now so now we got the person that's you know nervous that wants to over prepare not over prepare but prepare takes time what rehearses to it does it a whole bunch of times you have somebody that's on the opposite side of the spectrum that thinks hey i can just get up and wing it or i don't need to prepare or be more natural or those type things are those guys people good presenters or what should they watch out for if they're on the opposite side say oh when i get into the venture you know when i get to the venture pitch i'll just wing it and i'm i'm good on my feet and i'll make sure i'm sure i can deal with it here here's my perspective devin if you're someone who wins but you've raised money and you've done it successfully then i have no feedback for you right but if you're someone who wins and you haven't raised capital yet then i would suggest you prepare a bit more because especially in this fundraising environment so if we are having this conversation eight months ago i would say do whatever you want because the the founders had so much leverage literally before covet because so many there's so much money in the system you could literally raise money off a pitch deck it was insane right but now the tides are slowly changing and a lot of the funds are starting to tighten up so you better be sharper than you were before because now the market demands it right so if you want to get through that i'm i'm a big proponent of putting all the chances on your side right i think preparing a lot for it will get you there because there isn't like i've probably seen what 300 presentations on my life of startups there isn't a single one i haven't seen him i haven't found a mistake in like i've always found a whole at least one usually 10 or more but there's always a hole somewhere so i highly recommend to prepare for sure all right no fair enough and and i so i've peppered you with a few questions but you're the expert so what are other things that i haven't raised or and i don't know about that others should be thinking about is they're ready they're getting ready to pitch or they're asking for money or doing their pitch deck or anything else what would be any other advice or thoughts you'd have for them yeah i would say the last thing is you need to understand that there's different versions of your pitch so let's say for example you have a demo day pitch it's show body it's five minutes that's how it's supposed to be right you want to garner interest but the real pitch right the real pitch is when you meet them one on one when you meet the vc informally in a one-on-one coffee chat where you're explaining the slides and the business in more detail you want to make sure there's a more advanced but for those who are raising like a seat or a series a it's required in my opinion you want to have a bunch of backup slides like every question that somebody's asking or criticizing you so for example when i look at a business i don't just say this is a great five minute demo day that's just the first step the second step is saying what are the questions that we need backup slides for that a venture capitalist could ask us so for example pricing breakdown between competitive services where what what is your opinion on the future of the the industry where do you think the industry's going maybe you have time to go for that in five minutes but they'll definitely ask you your opinion because they want to understand your point of view as a founder because that's what matters because you're playing with the future and the future is risky so they want to see how you navigate through that and that's those are just some examples there's going to be a bunch of stuff that's going to be unique to you that you want to have in backups the best founders i've seen have 100 backup slides i think it also it gives it the point of it shows that you've thought through the issues or you you have a fully fleshed out plan so even if you have that backup slide you only spend 30 seconds on it it provides that confidence okay i'm working with someone that actually saw these through and they're not just kind of winging it or they don't have you know a half or fleshed out plan and a lot of times that gives as much confidence as anything exactly and i can give a super easy example when i meet founders this is kind of how i assess whether or not they're sharp so let's say for example i asked them a question i say talk about your competitive landscape like something super easy did you consider this competitor this committee like two big people in the space if a founder goes oh you're right i should definitely consider that thanks for bringing it up i know they're poor founders because they haven't done their homework the really good founders reply with why are you asking me this question like i obviously went through this i know my business better than anyone those are the really good founders right the people who aren't afraid to just throw it back in your face but i think but that's that's that's the kind of stuff that we look for and i think those are the founders who have the highest probability of succeeding so you want to make sure all your eggs are lined up for sure all right so i'll ask my one last or one more question then we'll start or we'll kind of wrap things up so once one thing at least in my experience that you know when i've done a few pitch decks or pitches i've also sat on the other side i've been kind of or done all of in between but not to the level as far as you have i've seen that you get some people that feel like they're being attacked right or they feel like if you get a whole bunch of questions or you poke holes or you're pointing out things that they don't know they almost go on the defensive or they feel like they're being attacked and so they get aggressive back and i at least my experience is that's usually not how that you want to react you don't want to react aggressively back but is there any thoughts am i wrong on that should you act aggressive back should you take that as input and say that's great or how do you deal with it if you feel like you're being attacked and your natural tendency is to be aggressive back right so so my my advice is best founders i've seen or have a very strong point of view what they believe but they listen to everyone else's so a good person i don't remember who it was but they summarized it really well the best founders in the world listen to everyone and ignore everyone all at the same time what does that mean that means that they understand everyone else's perspective this is what devin thinks is what brendan thinks what everyone thinks but what makes them exceptional is they say now that i've listened to everyone i know which advice to ignore that makes sense for me an easy example i can use to explain this is a lot of people tell people on you know youtube and stuff to go all in to burn all the bridges or to have a side hustle and not burn all the bridges obviously both types of advice can't be right for everybody you can't do both you have to do one or the other and that's situational so let's say you're trying to build the next facebook chances are you'll probably need to go all in because your competition is going all in and it's a network effect business only one person is going to win facebook was the one who won and friends turned myspace are all dead but and let's say immediately i didn't know it no i'm just kidding but let's say you take you think about a media company like what i'm building with master talk i don't need to leave my corporate day job even if a lot of people say hey brendan you should go all in you're pretty good at this but i say no the the capital that i get from my job allows me to to make these videos and produce without ever raising money so i get to keep 100 of my business and i'm going to win at least i hope so because i the competition that i have is very low and in that media's niche there's not many players to begin with and there's multiple people who can win there's not just one youtube channel in a niche that's successful there's multiple so notice in that example you have to as a founder you need to say okay this advice makes sense to me and this advice doesn't but if all you're going to do as a founder is just reject everyone else's advice without thinking through them then you're probably not going to win because every human being is flawed in some way shape or form and your ability as a founder is to say this is what i'm really really good at and this is what i really really suck at so i need to listen to everyone else even if it means i get you know hit in the face sometimes and and everybody's getting a hit in the face sometimes you just have to learn to deal with it so well there's a probably another hour or two we could go on and all sorts of fun questions but probably the only two of the people who'd find it interesting was that you would be at some point so i appreciate you coming on i think it's been a fun conversation any parting words for anybody before we wrap up yeah i just want to say that as an entrepreneur you know it's i think it's a it's a hard journey but it's also a fun one i think you get to build something really interesting and i and i hope you all realize that the earlier you learn how to pitch the easier it will be to navigate the process because remember that a pitch is not just a presentation it's your daily life as a founder no i think that's great advice well if people want to reach out to you they want to get your advice they want to hire you as a public speaker they want to just be your friend or anything in between what would be the best way to reach out to you and connect yeah absolutely so if you have any questions or if you want like a free session where i just go through your pitch and give you some improvements because i'm just doing that for free to promote the channel right now you can just message me directly on instagram that's master your talk or if you just want to send me a complaint or an insult that's also fine and if you want to check out my youtube channel where i share all of my best public speaking tips to show you how to communicate the pitch deck then that would be master talk in one word all right well i certainly encourage everybody to check you out on whether it's instagram youtube or anything in between um certainly it's been very insightful and helpful for my end i'm sure it will be for a lot of the listeners as well so thank you again for coming on it's been fun to have you fun to talk a little bit about how to make sure you master pitching and uh make sure that you get lots of investor dollars and uh appreciate the time and the effort and uh we'll have to have you back on another time to to talk about the few of the other questions that i have that we didn't have time for this time of course devin my pleasure English (auto-generated) All Recently uploaded