Almost everything shifted online around May 2020, and investment proposals were among the first to do so. Overnight, the entire startup funding landscape changed. For many businesses that conduct business online, the transition to the internet was not a surprise. The bulk of VC firms, on the other hand, only adopted an offline strategy.
When pitching online, it’s impossible for founders to “read the room,” which puts them at a significant disadvantage. People could consistently anticipate which entrepreneurs will get funded based simply on physical clues such as body language, facial emotions, and stage presence, according to research by UCL School of Management professor Chia-Jung Tsay. In essence, this new pitching style presents entrepreneurs with a new problem: it’s vital to hold investors’ attention, but it’s also more difficult than ever before. The “teaser trailer” can help a startup in this situation.
It requires more work if investors can’t understand the teaser without comments. Every year, we listen to about 1,500 online pitches at Flint Capital. After hearing 15,000 pitches over the course of ten years, I’ve gained some insight into how to properly construct and exploit teasers that entrepreneurs would find useful while pitching online.
What is the significance of a teaser? It gets your contact ready for the big meeting. Every good pitch begins with the preparation of the pitch. It’s always better to have a reliable contact, such as another investor or the founder of a portfolio firm, who can introduce you to potential investors before you meet them.
In my experience, a pitch from a recommended entrepreneur results in roughly 85% of closed sales. This means that the founder should give their contact this teaser as a first introduction to pique the investors’ interest.
As an extension of your “elevator pitch,” think about this. Because we don’t have the same options for face-to-face meetings, this is how founders may pique investors’ interest.
It allows you to take an active role in the pitching process. Before the initial online pitch call, investors will almost always ask for a summary of your proposal. Making a teaser trailer ahead of time gives you the opportunity to impress VCs with your initial impression. Include elements that excite investors’ curiosity and make them wonder how you’ll pull this off.
“This is an uncommon number,” they’ll think to themselves. “I’m curious as to how they arrived at this conclusion.” But be careful not to go overboard with the drama, as this can be off-putting. It provides you with the sales benefit of constantly increasing interest. “You have 30 seconds to buy three minutes,” says the sales adage.