How to gain business clarity

How to communicate with clarity

In this session, we'll cover some ground that will help you understand how to pitch your business to different stakeholders.

Click on the image to access the video presentation.

Tasks

Write 3 version of your elevator pitch for three different stakeholders of your business.
Define your core principles and design how you are going to enact those core principles in the way you run your business. E.g. If you care about customer service, how will you ensure your customers get the best service?

Downloadable resources

Further reading

The Startup Idea Matrix by Eric Stomberg
How great leaders inspire action TEDx talk by Simon Sinek
How to pitch a VC TED Talk by David S Rose
How Not to Pitch a Billionaire by Gimlet

Tools to adopt

Webinar Notes

Have you ever been stuck for words when introducing your business to a stranger? This will help.
I remember the very first time I had to pitch a business to a group of people, I was so nervous that I spoke way too quickly and mumbled a lot of my words, but thankfully the core of the pitch was able to be understood. A lot of success in business comes down to your ability to successfully tell people about what you do, why you do it, who you do it for and how you do it well. The trouble is, not every person is looking for the same level of detail or coming at your business from the same angle. Last week we touched on your mission and vision, and this week we’re going to elevate that learning so that you are better prepared to flex your pitching muscles no matter the circumstances.

What does your business actually do?
One of my favourite things is when I happen to be sitting in a cafe and the people next to me are pitching someone to become a client or a business partner. It’s almost like listening to someone ask someone else out on a date. It can be really embarrassing, awkward and just plain awful. Once in a while, it goes really well though and those are the ones I try to learn from.

In episode 1 of Startup, a podcast series by Gimlet, Alex meets with a top tier investor but doesn't know how to frame his business effectively. I really want you to go listen to the podcast for yourself and come back to this. Pause here. Head to the further reading section on the session page and click the link. I hope you did listen to it. The level of second-hand embarrassment is so incredibly high. Let’s get into the analysis.

What did Alex do wrong? He didn’t contextualise the listener. Alex didn’t think about researching the other investments this guy had made in enough detail to understand what he’s willing or unwilling to invest in. Alex didn’t know how to pitch and paid more attention to his shoes than what he was actually going to say to this guy who could reasonably hand him a few million dollars to get his business off the ground. Alex tried to follow the listener, when you as the pitcher, should be leading the listener into asking specific questions. The less clear and confident you are in your business, the more likely it is that you’ll confuse your listener and end up having to answer the question no one wants to hear in the middle or immediately after a pitch, “what does your business actually do?” If you get that question, you have screwed up in every way you could possibly screw up your pitch. I got that questiona after a pitch once from one guy in a room of 600 people. I seriously went home afterwards and wondered about whether or not I had gotten it wrong. But if its just one person out of 600 and everyone else seems to get it, then that guy just wasn't listening. Take it with a grain of salt I guess.

Alex from the Startup podcast was lucky because he was speaking to someone that was actually willing to help him re-frame his pitch, discover the strengths in what he was building and help him recognise the holes in his methodology. He was also very lucky to be speaking to someone who knows how to do that stuff. Most people know the difference between a good pitch and a bad pitch when they hear it, but most people can’t tell the difference between a good pitch and a good business. As you work on your pitch you’ll start to recognise the holes, the strengths and the opportunities to engage people to support, partner and invest. Also, just so you know, Alex’s company eventually got bought out by Spotify and there was a short lived TV show made about him starring Zach Braff.

Let’s go over some of the key principles of business clarity and then we’ll put that all together so you can come up with a kick butt elevator pitch.

Your mission is how you change the world for your stakeholders.
Hopefully you’ve already done the work to develop your mission and vision based on the information in the downloadable resources section of last week’s session. Take some time to recap that work for yourself.

The level up we’re applying in this session is that now you are focusing on recognising the different types of stakeholders you will have as a business person. In broad strokes you should know who the different actors are in your supply chain, meaning, the people you need to get your end product or service out. For example, in e-commerce, you could be relating with suppliers, customers, retailers, wholesalers, influencers and more. You should be able to create a mission statement that you can tweak ever so slightly here and there so that depending on who you are speaking to, the message remains the same, but the content becomes a little more tailored to their specific needs. What you say to a customer is a little different from what you’d say to a potential investor.

While you could have a catch all mission statement that you’ll probably have on the about page of your website, your ability to tailor your mission statement and other pitching content to the specific audience you are speaking to is how you lead the conversation and open up specific avenues for further exploration within that conversation. For example, when an events software company is pitching to a potential partner, they could say something along the lines of, “we support the creation of authentic experiences that establish long-lasting relationships between attendees, hosts and vendors through technology.” On the other hand, you might say to a customer, “we help event hosts create experiences that authentically engage their attendees.” The words that are in common are, “create”, “authentic”, “experience”. You may also have noticed the change from “we support” to “we help”. Technically they mean the same thing in this context, but “help” is a lot more personable than “support”, which is typically used in more technical or infrastructural contexts. So “help” was used to speak directly to the individual customer, where “support” was used to speak directly to a company’s representative.

Innovators create new things, based on disrupting the status quo. For the ease and efficiency of a specific group of people.
Have you ever heard someone call what they’re building, “the Uber of” or “the Airbnb of” or “the Amazon of” whatever it might be? That’s because it's a helpful shortcut that will hopefully build a positive association in the mind of the people you’re trying to work with. This is typical of pitches specifically to investors. You want them to know that you are aware of the market, you see exactly where this innovation you’re building could be in 10 years and you can point to something that has already been wildly successful utilising a similar methodology.

Knowing where you stand in the market will also help you differentiate yourself from the rest of the pack.

Exactly who is this customer that you want to help so badly?
Your understanding of your direct customer will be the biggest make or break element of your work at any point in time. What are you doing to get to know your customers effectively? There are a number of tools you can use to help you understand what customers are looking at from your competitors. Our favourite is called Ubersuggest. The idea behind the platform is that for FREE, you can find out what pages on your competitor’s websites are getting the most traffic. Using that information you can start understanding what your customer is curious about and what they would like you to prioritise on your own website. When you’re up and running, you can use tools like Hotjar that helps you see how your customers are using your site, so you know if they are accessing the pages in the way you want them to.

Until then, you can use platforms like Faraday, (it's particularly useful for consumer based products) to help you get to know your customers before you start developing the product completely. It's a way to test your idea with the public quickly (for some coins).

Start putting together your thoughts on who your customer is, based on the information you can collect about your competitors’ customers. They will have written blog posts about it. Most CEOs have a blog or a podcast that you can listen to and get to know more about the insider info on the company. If you’re trying to build a venture (meaning you want to be funded by venture capitalists) you should be listening to the podcasts and reading the blog of the investors that invest in the area your business is in. They’ll be dropping gems on a regular basis that you can apply to your business. When you launch, you’ll want to have ticked as many of the boxes as you can so that your customers find it easy to relate with what you’re bringing to the table. Ticking the boxes doesn’t mean you’ll get 1,000 customers on day one, it just means that you’ll be better off than a business that doesn’t know that there are boxes to tick in the first place.

Where do you want to be in ten years?
So much of the discourse we have around the future of business leaves out the practical effect running a successful business will have on the person or team running it. Knowing where you want to be will give you the clarity you need to get there. More than knowing how your business is going to affect the world, which is what we worked on in your vision statement last week, you need to know how you want your business to affect your life.

Having worked with thousands of entrepreneurs, one of the things that strikes me each time is the difference between life expectations. Just as there are different personalities, there are different wishes for the outcome of a business journey. Some people want to use their business as an in-road into a high flying corporate career, like a great way to prove your competency in a field you have no other professional or academic experience in. A couple of entrepreneurs I’ve worked with have been hired by Unilever on that basis. Other entrepreneurs want to create something that gives them the independence to live their own life in what they would call a stress free environment; not too big, not too small, just enough to provide a happy enough life. Other entrepreneurs want to build something they can sell on to the highest bidder, so they can move on and retire early. Then there are the entrepreneurs who want to be on the cover of Forbes, Times and any other magazine with Oprah and the Queen. Knowing the life you want to live will help you determine which doors to knock on and what you should be building. It will also help you determine how big you make this thing when you're talking to people about it. Because trying to sell people on what you're doing is sellinng them the future. So if you talk a big game but you really don't want that big thing, you're setting yourself up for a really disappointing end.

Do you know the intended consequences of your work?
When you put something out into the world, the outcomes are super important, for the world. Whatever you do is going to change the course of the future in one way or another. How do you intend to change it?

This time, I want you to think about your values. One of my favourite things to bring up in discussions about entrepreneurship is the difference between Mark Zuckerberg and Bill Gates. Their entrepreneurship trajectory has been so very different based on the choices they have made. From the very beginning of Mark Zuckerberg’s entry into the startup world he showed us that he wanted to be the biggest and the most successful no matter the consequences. If you haven’t already watched The Social Network in which we get to hear all about how Eduardo Saverin, Mark’s co-founder got cut out of Facebook, you really should. Saverin is now an investor worth over $11Billion dollars (a fortune kickstarted by his lawsuit against Facebook). That story and the multiple lawsuits Facebook had to settle because of Mark’s actions taught so many entrepreneurs what it meant to be successful and it continues to negatively affect the way the startup ecosystem works today.

On the other hand, we have Bill Gates, who has spent the majority of his fortune supporting the development of vaccines to infectious diseases around the world. He spends the majority of his time seeking to engage the rest of the world in practices that will ensure our continued life on this planet, eradicate hunger and poverty and engage young people in activism. Founders and other wealthy people around the world have followed his example over the years and have started their own foundations, corporate social responsibility projects and donated large amounts of their wealth to society. A recent example is the founder and CEO of Twitter, who donated a third of his net worth to charities supporting people living in poverty.

Not everyone will build something on a global scale, but whatever you do, you should recognise the impact it will have on those around you. Before you go out talking to people about your business, you should be clear about your intentions.

If you stand for nothing, you’ll fall. Hard.
A couple of years ago, investor meetings started changing. One of the staple questions became a variation of, “what do you see about this industry that your competitors don’t seem to understand?” If you really think about the question, it isn’t asking you about the market changes, the financial aspects of it or even the technology. The question is trying to get you to talk about what you believe is important to ensure the future of your industry. For example, in the charity sector, an answer to that question could be, “we need aggressive transparency between us and our donors so that they know what we’re doing and why we’re doing it at all times.” For Amazon, before they become the juggernaut they are today, the thing they saw was that, “customers don’t have to stay with you if you give them bad service. They can leave at any time.” That’s why so much of their USP is based on customer service; quick delivery, easy returns and refunds etc.

You have to know what you value. It can be related to anything you think matters within your industry. For example, if you were running a company in the gig economy, you could say, “our staff are the lifeblood of our business so we need to give them everything they need to ensure they have a safe and enjoyable experience.” While your answer shouldn’t be controversial in the sense that it is negative, it should be controversial in the sense that it goes against the grain. So what are you going to stand for?

Define your core principles
Take a moment here.

Think about the best and worst experiences you've had as a customer.
Decide how you're going to recreate the best and avoid the worst in the context of your customer and your work.

Who are you to decide the world needs to change?
There’s something quite "Pinky and the Brain" about deciding to start a business; to innovate and to attempt to change the world in one way or another.

The thing you have to be clear on is what makes you the right person to do this. It is something you’re going to have to include in your pitches and it's something you should know for yourself in the future. A big red flag for me when I’m listening to a pitch is when the founder can’t demonstrate any kind of expertise in the area. It's a red flag because it means they haven’t even tried to get an online certification in the subject area. There are things you can wing and there are things you can’t. Every Black person has heard the phrase, “you have to work twice as hard to get half as much.” This is kind of like that.

When you think about your business, make a list of the attributes that the perfect founder of that business would have. Is it a particular certification, skillset, temperament etc. There are so many things that could add to the framework you design and you get to make it up. Think about it in terms of defensibility. Who do you have to be to make sure someone couldn’t just do the same things you do and gain the same level of success?

Elevator Pitch
This is another task you need to complete before you go any further.

Imagine you have 30 seconds to get someone interested in what you're building. What will you say? Write it down now.

Now that you've written it down, let's compare based on the framework we're about to discuss.

The Simon Sinek Method: Why + How + What

This is one of the main ways businesses communicate their work to the rest of the world. Companies focused first on profit, that is.

We covered a bit about Simon Sinek last week, so I won’t go into detail, I just ask that you try to engage in further reading, like his book, and watch the TEDx video.

Here is a quick recap

“Why” should cover the big outcome and it should be tailored to the specific group of stakeholders you are speaking with at the time. For example, if you’re talking to a potential customer, your starting statement should focus on the big picture benefit using your product or service will have on them as an individual. This part is sometimes interchangeable with a condensed version of your vision statement.

“How” should cover the values you’re bringing into the business. For customers, you want to refer to things they will value like professionalism, personalisation, community, authenticity etc. You should be putting words in that immediately signal to them that you understand their needs. This part is sometimes interchangeable with your mission statement.

“What” should cover the nuts and bolts of what you’re actually doing. Again, depending on the people you’re talking to, you should be ready to give details and not give details as the situation permits.

An elevator pitch is particularly useful in high speed networking situations because it helps the person listening to you decide quickly whether or not they can help you and if they can help you, they know how almost as quickly. The last thing a busy person wants is to enter into a conversation where the person can’t explain what they do effectively and worse still, doesn’t know what they want from you.

The Bayo Adelaja Method: Who + How + Why

Since Simon Sinek’s method isn’t meant for non-profits, I thought I would do a little research of my own to find out how social impact focused organisations choose to introduce themselves.

Like the Simon Sinek method, the “How” and the “Why” remain big parts of the conversation, the big difference is the swap out of the “What” for the “Who”. Nonprofits are focused on solving a problem for beneficiaries, meaning people that don’t pay for their services or pay very little for their services and are primarily sponsored by large organisations and donations to do that work.

When you enter the room representing a nonprofit, the expectation is that what you’re pitching is primarily going to benefit the beneficiaries and not the people donating money or the corporations offering their support. It's an entirely different ball-game. In an elevator pitch for a nonprofit you are trying to get them to support you so that you can support someone else. So you start with “Who”. Most organisations, partners etc will already have a group of people they are interested in supporting and have a budget laid out specifically for that. So you’re trying to tap into what they already have ready and available by showing them that you fit into their criteria.

The “How” remains the same as in the Simon Sinek method. You’re talking about your values, how you support the beneficiaries and any other elements you’ve chosen to include in your mission statement.

The “Why” in this method is slightly different. Rather than tailoring the “Why” to the stakeholder you’re speaking to, you want to sell them on the impact you are creating in the life of your beneficiaries. You want them to fully understand that by supporting you, they are contributing to a better world for a group of underprivileged people in very specific ways. Most people tend to explain the short term, mid term and long term impact of their work on their beneficiaries’ lives as a way of contextualising their impact. It's called a “theory of change”.

If you find neither of those methods work for you, come up with your own method and test it out with a few stakeholders you’re interested in working with. The key elements are “what”, “who”, “why”, and “how”. Basically the point here is that these two models aren't the only models that exist. Its fluid in some ways. You can be a Patagonia or a Google, there are for-profit and non-profits elements in the work both of those companies do. If you don't like the Simon Sinek method or the Bayo Adelaja method, feel free to come up with one that work for you.

You’re on your way to success if you can elevator pitch your business to three complete strangers (preferrbaly stakeholders) and they are excited about supporting you in any way they can.

This webinar was presented by:
Bayo Adelaja, Chief Do-er at Do it Now Now
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