The European startups ecosystem is quickly developing. The local economic policymakers recognize and appreciate their importance to economic growth and delivering innovations very well, so the amount of investments for new businesses and startups in the area has been consistent.
For example, European startups are great hiring machines, attracting talent from all over the EU as well as other countries, thus creating more products and services and driving investment. If you’re a recent graduate looking to get funding for your business idea and attract some good investments, then writing an elevator pitch should be one of the things on your mind.
Why should you care about an elevator pitch? How to write a compelling pitch that can get you as many as possible requests for more information from interested investors?
In this article, we’re going to answer these questions and teach you the anatomy of a successful elevator pitch.
Why is Writing an Exceptional Elevator Pitch is Critical to Get Funding for Startups?
It goes without saying that for the vast majority of investors, your business idea or product is pretty much nothing. They encounter many people pitching their ideas on a daily basis, so they don’t really care about reading a lot about how great your project is. One reason why so many investors prefer to take a little bit passive approach here is that new entrepreneurs often use the elevator pitch to ramble on and on about their ideas.
Even though the rambling is supposed to make an investor interested in hearing more, all it does is overwhelming and even confusing them. Since a lot of entrepreneurs prefer to take this road, they’re giving you a chance to stand out. To take advantage of this opportunity, however, you need to write an elevator pitch that’s good enough for that.
So how to do that? We’ll get to that in a minute, but let’s do first things first and talk about what’s an elevator pitch and why it has nothing to do with elevators.
What is an Elevator Pitch for Startups?
Simply explained, an elevator pitch is a concise and clear message or “commercial” about your business idea. The typical length of a well-spoken elevator pitch is about 30 seconds, which makes succinctness a critical consideration. The main idea behind the pitch is to communicate the essence of your idea and explain why investors should care about it.
One interesting way to think about your elevator pitch as a Twitter version of your business idea. It shouldn’t be longer than 30 seconds, which means that it has to contain between 80 and 90 words, or about 8 sentences, to meet the time requirement. Since an average person speaks between 120 and 200 words per minute, aiming for 90 words is your best bet.
Many entrepreneurs make a mistake by stuffing more words into the pitch, which is only possible by speaking fast. However, doing so demonstrates the fact that they’re nervous and unsure about the outcome of the conversation. A much better way is to go with 90 words in your pitch because it allows you to speak slowly, which conveys competence and confidence.
Now that you have an idea about what an elevator pitch, let’s dig a little bit deeper and reveal how to write one.
The Anatomy of a Compelling Elevator Pitch
An elevator pitch should meet a number of criteria that you should be aware of before you even start to write it.
First and foremost, there are two main concepts that you must build your pitch around: the problem statement and your unique value proposition. They give your pitch a good structure that aims to explain why someone should consider investing in your startup.
Second, as it was repeatedly mentioned above, it has to be concise to avoid having your rambling to the potential investors, which is one of the reasons why the latter are often sick and tired of hearing pitches.
Third, the pitch has to be understandable. If your business idea contains some tech or industry-specific vocabulary, then including it in your pitch might not be a good idea. If you do, there’s a chance that some potential investors might not understand it, therefore, they won’t get a proper snapshot of your business.
In fact, The EU Startup Monitor report claimed that more than 82 percent of local startups engage in business-to-business (B2B) markets, so chances are they used a lot of industry-specific talk in elevator pitches.
Fourth, the text should be attractive to your audience. Remember, they’re very interested in knowing how they can benefit from taking this risk and investing in you, so make the returns very clear.
Presenting yourself and your company in the best possible light is without a doubt critical, so with the above considerations in mind, let’s talk about the outline for your elevator pitch.
An Elevator Speech Outline
In this section, you’ll find an outline that you can use to build your own elevator pitch. So, the outline that we propose here consists of the following six points:
- Stating the Problem
- Presenting the Solution
- Describing the Competition
- Sharing the Information about Your Team
- Giving a Financial Summary
- Concluding the Pitch with a Call to Action (CTA).
Now, let’s talk about how to write each of these sections.
Step 1: Stating the Problem
As it was briefly touched upon above, this is one of the main elements of an elevator pitch that sets the stage for the rest of the text. By letting your audience know about the problem, you’re showing them a business opportunity; moreover, if your idea or business doesn’t help to solve a real problem that people have, your business model is simply unviable.
The problem that you’re talking about here might be complex, but keeping the description under one sentence is critical and very possible. Read some examples below for inspiration:
- “Meal-kit delivery services are thriving in Germany, but yet there are no such companies in Warsaw, Poland” (a proposal to organize a meal-kit delivery service in a city with little to no competition)
- “Collecting real-time employee movement data on the manufacturing floor is difficult and requires in-situ observation” (a proposal to fund the development of a real-time employee tracking system for manufacturing businesses).
As you can see, conveying problems in a simple and concise form is possible. Ideally, you should be able to limit the description of the problem with one sentence, but having two may also be okay.
Remember, not only this section identified the need but also serves as an attention hook for investors looking for great business opportunities, so try to make it as appealing as possible.
Step 2: Presenting the Solution
A lot of entrepreneurs make a mistake by starting their elevator pitch with this section. Not only it makes the pitch sound unnecessary pushy but also confuses potential investors, as they need more information about what the solution is really for. That’s why you should always begin by describing the problem and continue with presenting the solution.
Try to make this section as concise as possible, too. Here’s an example:
“Using Ultra-Wideband (UWB) technology to track the movement of employees is a reliable option because of its ability to work in highly metallic environments.”
As you can see, this example doesn’t tell, it shows the core benefit of using a solution delivered by a startup. You should try to do the same; instead of telling that your customers love you, deliver specific advantages to make your message more credible and interesting to potential investors.
Step 3: Describing the Competition
Potential investors need to know if you’ve done some analysis of the competition, so that’s why this section is here. To indicate that you’ve assessed the level of competition and know how to address the problem in a unique way, you should write this part after considering the following questions:
- How many competitors are currently operating in the target market? Are there any market entries in the process?
- How can you differentiate your product or service from the existing competition?
- What is the existing solution that you will need to compete with?
- What are the advantages of your product or service that you can utilize to make sure that customers pick you?
Here’s an example (continuing the example from the previous section):
“There are three companies providing employee tracking solutions, but their systems are based on an outdated Bluetooth technology that works poorly in industrial environments.”
As you can see, you can focus this part on any weaknesses of your competitors or advantages of your business.
Step 4: Sharing the Information about Your Team
Another critical consideration that potential investors will pay a lot of attention to is your ability to deliver and execute, which is impossible without having proper talent. Only the right team can effectively build a company and satisfy the need you identified in the first section (in fact, a lack of skills and expertise is one of the most common reasons why European startups fail).
So, in this section of your elevator pitch, you should describe who’s with you. Try to highlight two important parts here:
- Having enough human resources to deliver
- Having sufficient expertise to execute and build a company.
For example, if you’re looking to build a B2B company that delivers tech solutions, then you need to have a dedicated R&D team consisting of engineers with appropriate expertise.
Step 5: Giving a Financial Summary
Don’t worry, there’s no need to write a detailed 5-year financial plan with expert forecast here. It’s important to talk about money and show that you have a solid business model ready to be executed, so in this section, we’ll do just that.
For example, if you’re starting a B2B business offering an employee tracking system, your customers will be manufacturing businesses that would like to increase safety in industrial environments. The list of the main costs in the first five years includes salaries of engineers, cost of developing tracking devices, traveling to customers’ premises, installation of systems, and maintenance expenses.
For each of these cost sources, try to have a forecast completed so you can easily talk about numbers if asked to provide more details.
Step 6: Concluding the Pitch with a Call to Action (CTA)
The last sentence of your pitch should call on potential investors to act. This is a commonly used technique; for example, including a textual CTA in emails is a proven method for increasing conversion rates by as much as 121 percent, according to reports.
So what should you have as your CTA? Here are some options:
- A call to visit your website
- A call to download your app or subscribe to your service
- A call to test an online demo of your solution.
Keep the CTA short and make sure that you can complete it within several seconds during the speech.
The European startup scene is developing at the speed of light, so you need to use everything you can to break through the noise and make your message heard by potential investors. Here, a compelling elevator pitch will help you to stand out and get more people interested in hearing more about your business idea.
One last thing: to make the process of writing the pitch easier, you can write down all your ideas for each of the steps described above regardless of word count and then work your way to the final draft by focusing on the most important details.
As you remove the fluff, shorten, and connect your sentences, you should have a working draft sooner than you think. However, if you still feel like you need some help with making your pitch writing concise and effective, getting quick training or getting advice from another entrepreneur will be a good idea.
Hopefully, you’ll stick with the above tips and write a compelling text that will get you funding for your startup. Happy pitching and make sure to be ready for the Q&A session!
Estelle Liotard is a Content Creator and Data Analyst at WoWGrade and holds a Master’s degree in Data Administration. She aims to combine her passion for writing with modern data technologies in order to provide her clients and readers with the best possible solutions to data-centric problems.