What’s the best way to talk about business risks?

Reid Hoffman (Partner & Co-Founder at Greylock Partners)
LinkedIn’s Series B Pitch to Greylock: Pitch Advice for Entrepreneurs

Steer into your investors’ objections. There will be one to three issues that are potentially problematic for your financing — address them head on. You have the most attention from investors in the first couple slides. Most investors arrive with questions, and if you proactively show you understand their principal concerns, you earn their attention for the rest of your pitch.

What’s the best way to talk about business risks?

Reid Hoffman (Partner & Co-Founder at Greylock Partners)
LinkedIn’s Series B Pitch to Greylock: Pitch Advice for Entrepreneurs

Experienced investors know there are always risks. If they ask you about your risk factors and you can’t answer, you’ve lost all credibility because they assume you are either dishonest or dumb. Explicitly identify the risks that could thwart your success and how you will mitigate them. And instead of waiting until investors ask about your risks, share them proactively so you build trust.

What’s the best way to talk about business risks?

Reid Hoffman (Partner & Co-Founder at Greylock Partners)
LinkedIn’s Series B Pitch to Greylock: Pitch Advice for Entrepreneurs

Entrepreneurs often say they have no competition, assuming that’s an impressive claim. But if you claim that you don’t have competition, you either believe the market is completely inefficient or no one else thinks your space is valuable. Both are folly.

What’s the best way to talk about business risks?

Reid Hoffman (Partner & Co-Founder at Greylock Partners)
LinkedIn’s Series B Pitch to Greylock: Pitch Advice for Entrepreneurs

Show that you’re paying attention to the market. Instead of merely saying that we knew product-market fit is key, we wanted to show that we did the work. We used quotes to show that we were talking to credible individuals struggling to solve our problem who were giving us feedback on our products. There are other methods, of course, such as graphs and data

What’s the best way to raise money?

Reid Hoffman (Partner & Co-Founder at Greylock Partners)
LinkedIn’s Series B Pitch to Greylock: Pitch Advice for Entrepreneurs

Investors see a lot of pitches. In a single year, the classic general partner in a venture firm is exposed to around 5,000 pitches; decides to look more closely at 600 to 800 of them; and ends up doing between 0 and 2 deals. The goal of an entrepreneur is to be one of those deals.

What’s the best way to pitch your company to investors?

Reid Hoffman (Partner & Co-Founder at Greylock Partners)
LinkedIn’s Series B Pitch to Greylock: Pitch Advice for Entrepreneurs

Be decisive and ship. Including specific dates, for example, shows decisiveness. Being decisive doesn’t mean that you have to stick with your decisions. Good investors expect you to iterate often as you figure out what product will grow your market.

What’s the best way to pitch your company to investors?

Reid Hoffman (Partner & Co-Founder at Greylock Partners)
LinkedIn’s Series B Pitch to Greylock: Pitch Advice for Entrepreneurs

Underpromise and overdeliver. Internally, our team expected that paid members would potentially get access to the whole network, but we had to make sure that the network would be comfortable with this. So we showed four degrees [of seperation] to our investors, to be sure.

What’s the best way to pitch your company to investors?

Reid Hoffman (Partner & Co-Founder at Greylock Partners)
LinkedIn’s Series B Pitch to Greylock: Pitch Advice for Entrepreneurs

Be wary of adjectives and especially adverbs. Anytime you use qualifiers like “very”, you’re overstating your point, which shows that you’re nervous about it. When I’m being pitched as an investor and I see such qualifiers, I make sure to ask questions about those areas because I know the entrepreneur is most nervous about them. It’s okay to be hyperbolic, to be aggressive, to be visionary [but] avoid adverbs and adjectives when possible.