LinkedIn founder Reid Hoffman has a great post on his website dissecting his original investor pitch in the light of what he’s learned in the subsequent decade.
The post is full of excellent advice from a business leader; the importance of finance versus product strategy, the risks of confirmation bias and finding what makes your business stand out from a crowded market are just three good points.
Hoffman also flags how pitching a business to sceptical investors helps entrepreneurs figure out what the real risks are in their business.
Another important point is that investment come into and go out of fashion, with 2003’s investment climate being very different to today’s.
In 2013, it’s whether you can break through the noise. Today, there are probably a thousand consumer internet startups founded every quarter — how do you become one of the 1 to 3 that matter in a 7-year timeframe? Those are the kinds of objections you need to steer into at the beginning of your pitch.
Ultimately though, Hoffman emphasizes how a business needs to be defensible, saying of LinkedIn: “It’s a network effects business, which means it has inherent defensibility with a network.”
Even for businesses that aren’t tech or web startups, Hoffman’s post is a great guide to developing a business plan and promoting a venture to investors and customers.