If alien economists went to startup events they’d conclude that all startups fail because they don’t know how to pitch VCs. (Some people think that all economists are, in fact, aliens, but I digress). The Canadian Regional Boot Camp for Technology Start-UpsStartupNorth and others and I was struck by how much emphasis was placed on pitching.
The agenda consists of a session on “Funding Pitch Preparation” followed by “Pitching Session to a Review Board” consisting of Canadian and US VCs. I’d like to ask a simple question:
Why do so many startup events focus on pitching investors?
Here are some of my concerns:
- Funding is a solution to a problem that not everyone has. There are many great businesses that never raised a dime of outside capital. So why does every startup event talk about funding?
- When you put lipstick on a pig… We spend too much time training startups how to speak the language of VC. Investors are in serious trouble if they’re filtering deals based on the ability to pitch.
- The pitch does not equal the business. People argue that honing the pitch means improving the strategy of the business. But in the real world, hardly any startups have everything figured out in advance. What’s the point of hearing them lie on stage?
- 1 size does not fit all. Lots of people do unspeakable things in Excel to force their revenue projections to scale to $50 million. Why? Because VCs are only interested in business that “scale”. But scalable busineses are usually riskier businesses. A lot of entrepreneurs would be happy with the payouts from smaller exits.
- Watching awful pitches is entertaining... That’s why people watch the Dragon’s Den and pitch coaching at startup events. But entertainment value aside, isn’t there something more useful we could be doing?
I don’t mean to criticize event organizers all of whom are honestly trying to help entrepreneurs. I’m also not criticizing the VC model which is a very specific type of investment that has been improperly promoted as a funding solution for everyone.
I’d just really like to see more startup events focused on all of the problems facing startups, not just how to attract VCs.