Hello, and welcome to the session on The Elevator Pitch. Elevator pitches are short descriptions of your business that you can give to people, if you don't have a lot of time to go into a full business plan description. So, for example, during the time you're running an elevator with a prominent venture capitalist. What I think is important about elevator pitch is, I think summed up really nicely in this quote by Karl Weick and others that, "A business is talked into existence." I love this quote because I think it's actually very profound. The business that you're starting doesn't exist yet, how does it start to exist? How do you get resources for it? How do you convince people to come on board? How do your customers on board? You do all that through talking and through convincing people things. The elevator pitch is the first tool in your toolbox of convincing people that your business should exist in helping give you the resources, customers, and other pieces you need to succeed. So to really think about an elevator pitch, you need to think about why you're bothering to do one. You might have a 100-page business plan in your mind or written down, and the question is, why are you even bothering to summarize it, why are you creating the elevator pitch. There's no way that a 20-second or 30-second description of your business will be enough to convince people to give you money, or immediately, have another meeting. The best you could hope for with an elevator pitch is to start a conversation that continues on after you leave that elevator. So the goal of your elevator pitch is to prompt the right question, to get people to ask an interesting question. How do you know it's the right question? Well, a question like, "Oh, you have time to do that?" or "That seems really nice, where do you come up with that idea?" Those are not questions that get to the heart of your business. If somebody asks you a hard question, a question that actually shows that they understand your elevator pitch and could use the conversation, that is a sign that your elevator pitch is successful. So that's why you do elevator pitch. How do you do it? Well, there's a bunch of ways of doing this. I'm going to give you a couple of methods here in this section. So the first method of developing an elevator pitches was actually developed not in Silicon Valley, but several 100 miles south in Hollywood. Hollywood also has a problem of having many page documents that need to be summarized in very short pithy ways. In this case, scripts. So in Hollywood, there's something called the high concept pitch. A high concept pitch describes something by analogy. So, for example, if you are a movie buff, who you might know the answer to, "What movie is Jaws in Space?" I'll give you a second to think about it. So I thought about it as Aliens. So here is a movie where just like in Jaws, where there's a giant shark picking off people one by one. In this case, it's a giant, to the alien picking up people one by one. You know already that this movie, just from the description, is going to be scary, it's going to take place in a confined location, it's going to involve people one by one fighting with some sort of creature, and the creature usually winning. So you learn a lot from that analogy of describing Aliens as Jaws in Space. We can do that with startup pitches as well. So what's Facebook for professionals? LinkedIn. So you already know that this is going to involve a social network, it's going to be involve connections to other people. But instead of sharing baby pictures, I'll be sharing resume items. What about the all-electric Porsche? Give me a second. All right. Another [inaudible] founded company. In this case, Tesla, the Tesla Roadster is the all-electric Porsche. Think about all the things you learn from that description. So we know that this car is going to be expensive. We know it's going to be optimized for speed, and not carrying a family. We know that it's going to be a fuel-efficient version of a sports car. There's a lot of information being communicated by that analogy. On the other hand, I often see pitches in my classes that are things like Warby Parker meets Netflix for pets, and I am completely baffled, I have no idea what this means. So if you have an analogy that works very well for a high concept pitch, you should definitely use it, but if not, if it's just a generic, Uber for something, or when we are the Amazon for cheese, makes sure that that works for you, and that it's actually helping you get to your point before you start to use that analogy everywhere. So let's say the high concept pitch doesn't work, here's another option. You can use a two sentence pitch. Two sentence pitch is also called a product positioning statement and reasonable like this. For a target audience who has a need, the product name is a product category that offer some key benefit. Unlike our competitors' substitutes, we are different in some key way. So what's great about this pitch is it manages to communicate in just two sentences, almost everything you need to know about a startup: who you're aiming for, what the product name is, why the product exists, who your competition is, what your benefits are over the competition. So let's take another example using that original Tesla Roadster, the first electrically powered sports car of any note. So for who? Wealthy individuals and car fans, that's our target audience, who have a need, they want a high-end sports car that is environmentally friendly. The product name Tesla Roadster is a product category electric car that offers the following key benefit; delivers unprecedented performance without damaging the environment. Unlike our competition, the Ferraris and Porches we're different in some key way. We offer amazing performance without any direct carbon emission. That's our key benefit. So just in those two sentences, we might tell you, who product is for, what it does, and why people would be buying it over the competition. If you're doing a more advanced version, add in things like a hook, a team, or an ask. So, what's a hook? A hook might be something to get people intrigued about your product, but in this case, the nine billion dollar supercar market has no equivalent of the Prius. Why is that a hook? Well, it's interesting to know and thinking about that idea that the high-end sports car market has no environmentally friendly option, but it's also exciting to find out this a nine billion market a year market, which means it has significant size, and is worth potentially going after. You can mention the team, where founded by Elon Musk, and includes some of the top electrical vehicle engineers on the planet. Why is this important? It tells you, we can accomplish the goals of the two sentence pitch and our startup. Or might also want to include and ask, what do we want people to do at the end of our pitch, we're looking for $50 million around F financing for 10 percent stake in the company, probably more ambitious than most of us are aiming for. But you might say, "I'm looking to find people who might be interested in this product, we're looking to get early-stage funding, we're interested in customers who might be interested in trying out our product" Those are all asks you can use to get people to do something at the end of your pitch. So the goal of an elevator pitches that prompt the right question. There's a couple of different approaches you can use; a high concept pitch if it works for you. Otherwise, a two sentence pitch is a really nice starting point. But you need to take the time to practice to be really good. So doing that involves spending a lot of time and effort, just doing a raw two sentence pitch is probably not the right idea. You want to sort of think about how to make it more compelling. Then we have other talks later on in this class about how to do that, and you might want to have different pitches prayer for different audiences. So if you're pitching it to friends and family, that might be very different than if you're pitching it to professional investors, versus experts in your particular field, versus customers. So you might want different kinds of elevator pitches, and where possible, don't just describe, show something, have the example of an app on your phone, have a picture of the product that you're doing, some sort brochure with you. So that when you have these elevator pitches, people have something they can see and understand why your product is compelling or interesting.