Don’t Sell Me the Plumbing
I don’t know much about copper pipes. But I know they exist. And, I know if I open the phone book I can find a plumber who knows all about them. That’s all I need to know about copper pipes. In fact that’s all I need to know about plumbing – period.
This is true of most businesses too. Once you have run a couple businesses you know the basics of how to run a company and manage employees. And you know who to call when you need a specific skill set.
I’m not involved in as much day–to-day business management as I used to be. These days I spend most of my time putting deals together or putting the pieces in place to build companies that other people will run. But I still understand the mechanics of building a business and still understand that there are some skills that you need “in house” and some skills that are best farmed out to experts. (Think of this like some jobs around your home you can manage with your D.I.Y. skills and some jobs – let’s say plumbing – you need to hire a professional.)
Because of what I do I get pitched a lot of businesses. I admire people who approach me to pitch their ideas – it’s not easy to walk up and pitch right off the cuff. Often these pitches are for startups and the person pitching has little or no business management experience.
But I’m also really aware of how important it is to make those few minutes count. There are a few red flags, which as an investor you hear a lot. One of the big mistakes an inexperienced entrepreneur can make is what I call “selling plumbing”.
“Selling plumbing” is when people spend most of their valuable pitch time talking about things that exist or can be hired instead of talking about their idea. I don’t need to know about how your website is hosted, how much bandwidth it can burst to, where your office is, what contracts you have negotiated with suppliers, etc. Say you have a product that needs distribution. We all know that distribution is possible – you buy a truck you hire a guy, etc. who cares. We all know it can be done. That’s all plumbing.
I don’t need to know about any aspect of the business that can be solved with money. I need to know the idea and how you (just you and not anyone else) will execute that idea. As an investor I can buy plumbing but I’m not going to execute the idea; if you don’t have an idea AND execution I’m not interested.
Pitch me the IDEA. Sell me the vision. Don’t sell me the plumbing and hide your idea. When you sell me plumbing I assume either your idea isn’t any good or you are not confident enough in the idea to pull it off. Either way you loose.
View all articles by Alexander Deighton