A pitch is for Startups It's not an easy situation: every sentence has to be right, one wrong word and you're in trouble – that's the fear of many founders. This fear isn't as unrealistic as one might think. Twitter thread of Twitch co-founder Justin Kan. The investor cites three clear 'red flags': If these are raised in a pitch, he immediately rules out investing in the startup.
1. No opaque key figures
Kan's first no-go is metrics that can only increase. Values like the number of previous downloads of an app, a company's revenue to date, or the number of "total users" logically cannot decrease. Once a download has been made, it cannot be reversed. At the same time, such numbers say nothing about the current success of a product or the development of user numbers, revenue, or downloads. Furthermore, a bitter aftertaste remains: Are the founders trying to deceive their investors? Justin Kan writes:
“Impressive numbers are obviously important, but not at the expense of trust.”
2. Outsource product development
Justin Kan reports that "business/finance bros" often pitch him ideas for a tech startup, even though they have no idea how to actually build a product. Not every founder needs to be technically savvy, but every founding team needs to be able to build at least a prototype themselves. Kan says a third-party development shop isn't a suitable substitute for launching a working product yourself.
3. No frills
Under the heading "Overhyping and excessive name-dropping," Kan advises against hiding behind fancy phrases. He sees cool buzzwords as sleight of hand that distract from the startup's actual work. Instead, founders should provide concrete figures and talk about their vision, the team, and their product. Above all, they should demonstrate why they themselves are enthusiastic about their product.
