When a business owner is looking to gain investors to fund a young and promising company, he usually will put together a strong Powerpoint or Word Document and “pitch” potential cash cows. In many ways, a pitch to a potential investor is much like the pitch an agent gives to a potential client. As an agent, you have to sell your company’s strengths and explain why your company is the right pick upon the many that are out there, for this particular potential client.
The Wall Street Journal recently released a free Entrepreneur Pitch Workbook created by a company called Canaan Partners. While the workbook was written to help entrepreneurs make an effective pitch to a potential investor, many of the workbook’s tips are applicable to all professions, including sports agents.
Canaan’s Director of Marketing, Gina Vakili, put together a list of top pitch mistakes (my own comments in green). Every single one of the mistakes listed below can be made in a pitch to a potential athlete client.
1. Lack of clarity – Executives should be able to express what the company does in 30 seconds. A presentation should be 30 minutes long without interruptions. Be clear about what your company does and how it can help out the athlete.
2. Arrogance and megalomania – Don’t bring a team to a presentation and not permit them to speak. “We invest in people and teams. If you brought your team, let them speak, show them off.” Allow the athlete to speak to others who will handle his account, especially his primary agent.
3. Avoiding questions – Don’t dance around questions, especially if they’re asked multiple times in different ways. Be thoughtful and willing to explain your concerns with the business. Answer all questions. If there is no proper answer, let the athlete know of that.
4. No competition – Don’t insist you have no competition. “We have a unique IP that gives us a multi-year lead” is never true. If someone wants to chase you, they can be right on your heels. Our business is more competitive than most. Let the athlete know that there are others out there who would love to represent him. Don’t diss the other companies, but let the athlete know why he should go with you instead.
5. Not understanding the market – Market-sizing should be top-down and bottoms up. Saying, “We just need 0.1% of the population of China to be a success” ignores the importance of identifying and describing the target customer. Understand what is available for the athlete. If it is a kid that just got drafted by an MLB team, don’t tell him that he will be in a movie in a year.
6. Not knowing the numbers – Be able to explain how your company plans to drive 500% revenue growth in its second year. But don’t suggest a valuation. Be able to tell your athletes how many of those drafted will make it, how many get endorsement deals, etc. Knowing the numbers is very important so that no false impressions are made.
The pitchbook, in its entirety, is below. Check out what else might be applicable to our profession.