SUTD Q&A, Fundamentals of Pitching & SEA Startup Dynamics - E221

Jeremy presents a question and answer session at the Singapore University of Technology & Design about the fundamentals of pitching.

Jeremy Au: (00:29)
So who am I? I'm a VC at Monk’s Hill Ventures. So we focus on investing in startups that can transform millions of lives across Southeast Asia. But previously, I was a founder, built a company from pre seed to Series A and sale. I am also an angel investor. And so as an investor, both as an angel and as a VC, I've seen 1000s of slide decks, and people pitch to me. And we also happen to be the host of Brave Southeast Asia Tech Podcast, which is at www.Jeremyau.com. And it's ranked in the global top 10 percent of podcasts. So if you want to hear stories about how founders actually go through their pitches, learn about their own tough moments as well as get better over time. In terms of a real, no BS, authentic way, then there's that podcast. Bain consultant, national service, Harvard MBA, UC Berkeley, bunch of awards along the way.
 
I think for those who want to know me a little bit more, I believe in three big things. I believe that growth will affect the business at organizational level and personal growth as a leader will resolve all problems. So it's not the business growing, but also you as a leader growing on a personal basis is really key. Second thing is I love to coach people to be great leaders, there's something that I find personally rewarding, and it's why I'm here today on Saturday afternoon. And I also believe that this too shall pass, which means that whatever happens happens, wherever you learn, you learn, wherever we present presented, we'll go from there. I'm a father of a daughter, I love hiking, science fiction and drinking tea with friends.
 
What we're going to talk a little bit about is, the context of Southeast Asia tech, and unicorns, and so forth. Because I think that there's a key macro view that everybody has to have. Otherwise, people get lost very quickly about why are we doing this? And then we'll talk about the pitch process in terms of how to do it? Also, why you want to learn how to do it. And because, I also remember the time when I was like, I don't need to pitch. So far. And after that, we're going to go into very detail that dive into the pitch. And I'm going to assume and talk to you as if I was talking to a founder, not as a student, not as young person, whatever, I believe that anybody can build a company. But I'm going to assume that whatever you don't understand, you ask the question in the face I have, or there you go Google this afterwards. Or when you run across a problem in 1 year, 2 years, 5 years, 10 years, then you remember that articulated this point of time. And then you know how to google it again, and solve it at that point in time. And then lastly, I'll give you some reflections I have about the actual process of pitching, which is things I've observed in myself in terms of how improved but also how I've seen other people do well, or not do well, in terms of the actual pitching process. So that's more of a story time. And then lastly, it'll be Q&A. Again, I'll be going through the questions that are there. So we'll go from there. So the reason why we're all here on the table is because all of us are interested in tech in some ways. So the context of the macro environment is that internet is the new electricity. And what I mean by that is it is something that's fundamental.
 
So you go back 100 years ago, electricity was coming out. And it was crazy. Like, there was normal companies. And there was electricity companies. That's it, General Electric, all these folks. There's something called electricity. And only companies that build electricity they'll call it Big electricity back then. And then electricity came on to transform everything. So everything became electrified. Washing machines, irons, the trains, buses, people trying to do everything on electricity at that point of time. Some have succeeded. Some did not. But that transformed a whole generation. Where even our parents and our grandparents had the benefit electricity. So internet is really the new electricity where is the fundamental shift in the fundamental layer of how we work, how we operate and how we collaborate. What's also important is that the reason why we're talking about this is because startups, why would you define startups have attack incumbents to create trillions of dollars of value? So lots of big words, why means is that, before electricity, there was pre electricity companies.
 
And then there were companies that use electricity. Today, we have technology companies, and the companies that are not coping with technology. And what's interesting today is that we have startups, which are even faster versions of this, that are always aggressively competing to create value to make things better for other people. The last thing, of course, is that we already know these two stories a little bit in America. Or in developed countries where we wouldn't call it. But really, I think we're all here on the table is because we ourselves in Southeast Asia are benefiting from being parked at New Tech frontier for startups, or innovation for thinking. And this is really a huge benefit that just did not exist before. Because the truth was, 60 years ago, we were going through a war. World war two, we were just rebuilding from war. So we couldn't even think about getting up the internet or technology, or even being entrepreneurial. We're trying to figure out how to lay out basic infrastructure. So all of us around the table are really benefiting from the fact that we get to build startups, we get to talk about pitch decks, we get to live and work in an environment of a zoom, where we're not having this macro environment where we're scrambling to handle shelter, food, and safety. And therefore, we can be thinking about technology, startups and pitch decks. And the truth is, if you look at many macro regions around the world, that many frontiers economies that don't have startups, because they cannot or do not have the ability or mindshare space or safety for people to think about startups. And even within Southeast Asia, we all know that different geographies. And for all of us around the table, we're primarily located in Singapore. So we benefit because there are other parts of Southeast Asia that do not get to think about startups, that do not get to think about technology, that do not get to think about how to pitch.
 
So fundamentally, this time period is particularly good for people in Singapore, and some parts of Southeast Asia. And broadly, Southeast Asia versus the rest of the world, to be thinking about technology as a frontier for us to build and create value together. So that's really key. And something to be thankful for as well. So what that means is that we talk about startups. And everyone's like, what is a startup? Is Grab a startup? Well, it's crazy. Because Grab is huge now. And everybody uses grab. So is that startup anymore? Well, it was a startup, a startup that's a small provision shop starting out, but happens to be a Gentry person. Is that startup? They're using startup principles. So I think one thing to think about is that, based on one of the questions, they just reflected, I would like to simplify the question, I'm going to define a startup as a newly established business. So it's a business that is starting out and is new. And that's it. And that's a startup. Because in the past, historically, startups were like, use technology, well, everybody's technology into a startup these days. So startups and newly established business, for someone who's talking about social entrepreneurship, etc, which I'm very comfortable with, and vary. I do think about quite a bit is about what is a unicorn? So that's the end goal. So a startup worth over a billion dollars.

So, I guess the fundamental question is, if you raise over a million dollars of capital from a top VC in America, what are the odds that you become a unicorn? So there's one in five, etc. So 16 people who have here. How many people say 1 in 40? Raise your hand. So that's three. How many people say 1 in 30, and 1in 10 and then 1 in 20? So pretty much actually feels like an even dispersion. So I'll say roughly, about 25% each. So it's a good question. And the short answer is, if we define that as the value of the chief that, historically is that is 1 in 40. And what that means is that fundamentally, on a roulette wheel, this depending on whether using European or American roulette, is that 37 or 38 wheels are there. So actually, you have better odds of going to a roulette wheel, all your life savings, and however our lifetime earnings for next five years. I put it on one number on roulette, then it is to build a start up with a goal to build a technology startup, there's worth over a billion dollars. And I'm talking about the US, by the way. We're not talking about Southeast Asia, where you can argue that the companies on average may be smaller, in terms of returns. We're not talking about capital markets, etc. So for example, if you try to build a technology startup in Antarctica, that odds is probably way worse than 1 in 40. So in America, it's 1 in 40. So that's how you should be thinking about that all the time. All that have back in your mind, what are the odds of success? Does it become a big company like Grab or SEA Group, etc. So what that means is that every startup, as a result, to get to that billion dollar outcome, again, has to crawl through three stages of it. And not everybody makes it. It's really about going through the jungle. Going through a dirt road, and going through the highway. So every company goes through those three stages.
 
And it's really key for you to remember that every startup is going through those three phases. A jungle face is very much saying, what in the world am I building? What am I actually caring about? What is it that I'm actually trying to achieve? Is it something that is worth building? Why I want to build it? Other people want to join you? In other words, what is the direction I should be going and figuring out? And that's super key to remember, because a lot of us when we talk about startups, we're talking about this half of startup like I'm building a startup, your friend looks at you. And he’s like, what's your startup? And you are, I don't know. So there's a key question. That you’re thinking about yourself, like what phase I am? Jungle stage, there's a lot of us around a table here. We were in a pitch deck, etc. When you get to the dirt road, dirt road basically says that you're basically reaching somewhere where you're starting to see the path, you have some customers, you roughly know what you're trying to achieve. And what is the right direction needed? You roughly know what you don't want to do? And you know, what you should do? And you know what you're currently doing? And at what speed. And then thirdly, of course, is the highway where you're trying to build and say you know exactly what strategy is, you have the people on board, you know exactly what direction they are actually going in, your job is to build the highway so that you can drive as many trucks through as possible. And that's when you take in a ton of growth capital, you have all the newspapers come out and congratulate you and say that you're doing a great job, etc. And it doesn't necessarily mean that you achieved the exit or product-market fit. But that's that size, the scale. And so that's something to always be thinking about, is the jungle, the dirt road and the highway.
 
Those are three phases that are there. And it's important for you to be thinking about a time because people get confused all the time. They say like, grab is a startup. And I'm like, yes, it is a startup because you start as a technology startup. But its in a highway mode. They're just trying to figure out how to do things. But now, some initiatives within grab, actually, right now are in the jungle, or dirt road phase. So there's different projects, when you try to enter a new market, when they try to enter a new vertical, then it's very important for the people within a team to not pretend that they are on Highway mode. So for example, if SEA entered Latin America, and with a sharpie, etc, then they have to tell themselves like, Look, I'm not, as secure or aware about what's going on. As if I'm doing a highway. My job is to have bring in people who are jungle explorers, who are going to land there and figure out how to do a navigation exercise, to get out of the jungle and bash away too much for other people to follow. And that's really key because all of us around the tea talking ourselves like, we want to be. And then I was like we are part of tech. Joining Grab today is so different from joining Google and Facebook, which is even an order of magnitude larger, versus joining a series A startup.So the different stages that a startup is important for you to be super aware about, therefore, not just the startup, but also aware about what you're trying to achieve in terms of your individual role. And also being aware that companies will die along the way. So, we talked about that 1 in 40 In America. Trust me, all 40 or even more companies, when you talk about seed stage. Honestly, seed stage basically implies from, you get a different type of VC, implies somewhere around a dirt road, your next transition is to a dirt road. And the jungle before that is way worse, there's like hundreds or 1000s of people who just have ideas, ideas and ideas.
 
Then in the middle, there's about 40 of them at any one time. As they reach all the way to the end of transitioning to the highway, there'll be like 20, 10, 5, and only one of them will manage to get all the way to the end of the highway, and have that billion dollar exit. And it's key for you to be thoughtful about it because then you got to be thinking yourself, Am I in a situation where I understand what operating model of the company is, in terms of the requirements? Versus what am I advocating today? And it's really key, because you're going to see a lot of people, you see a lot of highway people talking to you in the jungle mode. And then you're like, what is the relevance of this advice, and I've been there before, they're like, Jeremy, got to hire all these people, because it's a no brainer. And I'm like, yo, we're nowhere near there. And your judgment about what's relevant to you at what stage is super key. And so that hopefully provides you some context about why we in Southeast Asia get the thing about technology. And why we are thinking about what the odds of success actually are, the start goal of people say our team versus the angle, which is a bit of an outcome. And lastly, being thoughtful that going from Point ‘A’ to Point ‘B’ requires three major stages of the jungle, dirt road, highway, and being taught about that path. So that's really the macro environment. And so what that brings us down to is really saying like, if we know this about Southeast Asia, tech, and unicorns, and a pathway, etc. So what are the benefits? And why should we do a pitch. And the crux of it, is that the three major benefits that are really important pitching and most of us around the table, and we saw that a little bit in the question and answer session was once, we look at it as like, pitching is to get money, convince people. But I think the most important thing to think about pitching is, this is that you articulating the future to improve your business logic. Because if you already built a billion dollar company, you don't need pitch anymore, to some extent, you already have the answer. You already have numbers, you already have the data, and you just show to everybody.
 
And if Mark Zuckerberg walked in and said, "Guys, and girls, let's build a billion dollar company, and I already have a billion dollar company, and then he's like, Dennis, I like to pitch you guys about Facebook". And then you'll be like, wait, you don't need to pitch me on Facebook. I already use Facebook. Everybody uses Facebook. It's a, more than a billion dollar company. You don't need to pitch me. So why do you need to pitch? The reason why you pitch that ad every day, you are articulating the future of your business. I always tell people is, that's crazy. Because, that's what we do, brainstorming and a whiteboard, and so forth. But being able to make that summarize, concise and clear, is really difficult for a lot of people. And so being able to articulate it helps the future, but also helps you improve the business logic. And the second thing is that being able to pitch consistently, and now obviously, later on about a fundraising deck, and so on, so forth. But pitching is a form of sales that attract customers, teammates and supporters. And everybody hasn't been that bad to say, why do I care about you as a person? Why do I care about you as a business owner? Why do I care about you as a startup leader and founder, so you are here to attract customers, teammates and supporters say, “Yes, join my team”. Because it makes sense, even though there is no data to prove that I've been able to achieve it, or that I will be able to achieve it. And then lastly, it's really about partnering with capital allocators. So a lot of people who are out fundraising often have a situation where they're saying, the reason why I'm pitching, I am trying to achieve money. I'm trying to get money from my thing, from my ideas etc. And what I forget is that on the other side of that person, there is a bank, it's a debt, venture debt, VC etc, is that you actually partnering with them, you're making a transaction by also building a relationship with them. Because what they are saying is, I will provide you capital in advance of proof data and so far, in order for you to build this actual business, and that's really key, because I always remember, when i was at the start of it, my great grandfather, my grandfather retired and we're working on a plantation.
 
And so they had to save and save, because nobody would give them capital to build a little provision shop back then. And so even if they were hard working, even if they could attract customers, no one will ever give them capital. And so we're really lucky today where today the definition of a pitches means, instead of having a great business already, or whatever it is, I can build a slide deck, I have some experiments. I have the stability, the reputation, and that's enough to get millions of dollars of capital, for example, to be in consideration to fund my idea. And that's bonkers, if you think about it. Because the truth is the difference between our generation and that generation that could not get any capital at all, is effectively 50 years. Think about that. That's how crazy it is. So pitching is important, because it allows us to articulate the future, to improve the logic, that track the teammates, the customer’s exporters, and to partner with capital allocators who can help you build a business together. And someone's asking about what are the benefits of pitching? And I want to say is that this process is really super key, pitching is a means to an end.
 
So a lot of people are like, what do I need to say in a pitch to get money? And I always like, the first job is to discover, choose and build a great business. And as the big assumption that we're going to have around this table, and I'm sure it's going to come up later, in the meeting that we have, because when you build a pitch, does that make sense later on is it assumes that you have real business so that you can deliver the business? And so what it means is, you have to find a real problem that actually exists. And we all know that lots of problems that are fake, they don't exist. And you've heard that before, maybe a friend pitches you and say, Jeremy, let's build an NFT off your face on a piece of paper. And we're going to sell it. And you're like, who wants a piece of paper with my face? I'm not a piece of art. I'm not valuable. Is it a real problem that's, do people really want a picture of me or all people? Probably not. But if you talk about celebrities. Yes, of course, Scarlett Johansson, and, John Cena, so many other folks, they signed photographs of themselves all the time. And those are available to people, collectibles. And so it's a real problem. Because if you're a fan of, Tony Stark/Robert Downey Jr. Then you want that, there's a problem, you have a real problem, and you don't have that signature. I don't think anybody has a real problem right now say, I want Jeremy's face on a piece of paper. So thinking about what the real problem is. But the other part of you do, is think about for this group is. Do you want to solve it? Do you actually want to solve this problem? And I've seen so many people pitching great ideas, but I look at them. And it's like, we had a competition? Like, do you really want to solve this problem of all problems? There's so many problems solving the wall. Every year, the 1000s that has been launched, and many successful startups will happen and become scalable. But is this your problem? Is this the problem that you want to solve?
 
And the next thing about is therefore, if you find a real problem, and you want to solve that problem, then figuring out a great solution. Because the truth is, if you can't figure out a great solution to it to some extent, then what in the world are you pitching for? Why do you practice? How are you proposing? What are you selling? And lastly, we're talking about achieving product market fit. We're just talking about what exactly is the fit between the solution and actual problem and economics needed for it to be successful. And so that's something to be thinking about, about how to discover, choose and start building a great business, whatever it is, can be a social enterprise. It can be a nonprofit, it can be a business. But the truth is, anybody who's thinking about pitching, your fundamental role is to build a great business. And pitching is a means to an end to support their business. There's no other way around it, a lot of people sometimes see, look at it as like, the VC is a available. And so we look at the VCs, if they're like some parent, or teacher or exam, and then they, come in and say, I think we heard some of those questions that we had here. It's like, if a VC wants this, how do I achieve that thing for that person? And I'm like, that’s not it. They don't have any reality. They don't have any truth. They're not very smart. I can tell you that. And I'm one of them.
 
Like at the end of the day, VCs are saying, making a choice about which investment to make, but they don't understand your business the same way that you do. Fundamentally know, understand and decide, this is the business that I'm going to build, not just for half a year, because it's for school project, not for one year, not for two years, not for five years, but for 10 years and 15 years. Because if you are successful, you are going to be working on this problem for the next 10 years of your life. Think about it. 10 years for everybody around the table, where were you 10 years ago? Think about that. What happened 10 years ago? Well, my assumption right now is that, if you're 22, or 21, as I say, on average, 10 years ago, you're 11 years old. A lot happens in 10 years. So now you get to choose, you get to choose the problem that you really love. Because the alternative is that if you choose to build a business, that is not something that you love, that you don't want to do, then the fundamental fact is, either you succeed, and you're very unhappy about your success, which is pretty unlikely, or you end up failing, and building something because he failed, because he never loved the problem. And the truth is, you can't pitch something that you don't love. I can tell you all day long about why I think my wife is great. I can tell you all the reasons why my baby is cute. If you're asked me to, say make a deck about pitching someone else's kid, I will be like, this is a lot harder. Does that make sense? Because it's someone else's kid. Like my kid I know, 10 reasons, 100 reasons. 1000 reasons about why my baby is cute. And everybody, why my baby deserves ABC but by talking about someone else's kid.
 
I'm like, there's an order magnitude difference. So same thing for problems, you got to be in love with the problem. Because when you love the problem, then you can actually pitch well, as people are, how do I show more passion in my pitch? If you're passionate about a problem, you'll be passionate in your pitch. That's it. You love crypto, then trust me, everybody pitches crypto like crazy. And you pitch with passion. And now the question is how to improve that technique, how to articulate the sphere, how to talk about the upsides and downside, all those things are true. But you can replace that passion. There's no way I can teach that passion. So because of that you get to choose, you get to choose a company though. Now we're going to talk about the pitch. Again, subset of activity, where you're preparing, practicing, delivering. And lastly, you have to do your pitch, you find a raise whatever, look, the truth is, you got to go back to building a business. So you're going to build test experiments, incorporate the learnings or a pitch from the experiments, from the customers, from the VCs, on market. And then you keep pitching.
 
So once you start pitching, you never stop pitching, this is presenting more and more, but you keep improving your pitch over and over time. So I think someone mentioned earlier does this feels scary. It feels like this. How do I get the right tone of it? And the truth is, every time you pitch, you're getting better and better, it’s a skill, not an art, is not a science, its practice, is a skill that can be learned. I learned improv. So just like you learn drama, you learn a computer, is a skill that you just do over and over time, and then you build your own style and your own approach. So what we're going to go through is now go to a deck. And what we're going to go through a high level, that is why, the slides that you need to have. So obviously, you have a cover slide, we're not going to go into that. And I assume you mean cover slide, company logo and everything. We talked about market problem, the market opportunity, your solution, the team, the attraction, the competition, the financials. And lastly, they ask the capital that you want to use. So that's at the end of day about eight or nine slides that you really need to have, anything else is this extra detail, extra supporting facts, but these are the core things you're going to have to cover. I want to say that, this very much this interdependencies, this credit through the sources that I have, I'm not pretending that I knew and did all this, is very much a learning from other folks who have also presented this in the past and future as well. So, mockup problem, the first question I have and this is something that is super duper key, what's the problem that you're actually solving? And you have no idea how many slides I've seen decks that do not talk about this, or the answer, skipping it, they put a slide because they think is something to be done. I think only 10% of the decks I've seen actually talk about this well. And this i slight one, by the way.
 
I have to emphasize how important that you get this right. And if you think about it is not just a communication issue. But it's also a logic issue. Which is the business logic. Are you solving a real problem that you want to have? So you have to show the pain of the problem. Though the say those, whatever it is, you know, you have to be very much clear that this is a problem. And you can't create their mind, you can't say something like, if I build it, and solve the problem for them, then people will demand it. And I'm like, what are we talking about? So what's the problem that's actually being solved? So, if Claudia loves llamas, then turns out that there's a group of people around the world who love llamas. So you can go out and say, llamas are a problem for people who alike, Claudia, should it mean for people who like that as a cover picture, and so forth.
 
There's not enough llama stuff. There's not enough llama pillows, stories, etc. So globally, there's a Reddit thread called RL/llamas. And they can't get enough llama stuff. So that's the problem. There's no one stop shop. How big a problem that is? We can debate, we can discuss. But you get to be crisp about what the problem is? Versus if you said, the problem is the world does not have enough llamas. And then everyone's like, what? The wolf don't want llama, Jeremy does not want a llama. Dennis doesn't want a llama. Diana doesn't want a llama. So the question is, well, who are the people that want that? And then talk about current solutions and problems. Why that doesn't work? What doesn't work right now for the problem? Because a lot of people are like, basically choose a problem. There's a result. So it's a big problem. So people say something increments. Someone say, like, the problem is people want jeans. They need clothes to wear pants. This is equivalent. And then I'm like, but isn't that solved by Uniqlo Levi's, or every other Chinese brand on the market? Like, how are you solving the problem? The way it's currently solved is good enough or even better, superior because is brand, is cost, is a good price, is available everywhere. Everybody already has it. So being thoughtful about that is super key. So you need to solve what your client’s number one problem is. So I'm trying to say here is don't try to solve someone's number two, problem number three, problem number four problem. There's really a fast way to not get anywhere. So just be thoughtful about that, so for example I saw a great idea. If you look at supplements. And you think about supplements is that, all of us have supplements. And if a key requirement, he said, for people who believe in certain dietary requirements. So I needed the halal, because of my faith or my background, because I'm in a country, that so actually halal supplements are not compliant. They're not halal. They're not halal certified for sure. But they also contain lots of products. That from other animals, etc, that are not compliance, or not clearly verified that is, and there's no custody of the whole chain to make sure that it's not contaminated along the way.
 
So that was very simple. It's like, for people of this background, we provide certified supplements that solve that problem. And I say to myself as its genius, the Americans are not solving it because they don't care. If it's kosher or Halal have new requirements. But for people in certain categories, that's their requirement. Is their number one problem, which is that if I'm eating supplements, I don't know what's in it, I will prefer to switch to supplements that are compliant? And there's been one problem. At the moment of me taking supplements. So being thoughtful about the problem is so key, over and over again, being clear about the problem is the fastest way to either get the funding, get the support, get the teammates that you need to have, or it can be the difference between everybody's just not getting it, and the rest of the slides is a giant wash. And the way you can tell as a great problem slide is when you articulate the problem, everybody knows what a solution is. I've seen people articulate a problem, and then everyone knows what the solution is going to be. Doesn't make sense. Then the question is, how does it achieve etc? So what's the problem? When you define the problem slide, you say, in such a way to so its crystal clear, whatever it is. So for example, if you look at the fusion, startup, nuclear fusion, so they're saying, we can make clean energy with no carbon or whatever. So they're talking about your solutions, etc. Whatever it is to say is, look, the world needs energy, and you need it really, but there's not enough energy. That is, because it's getting more and more expensive. And we have all these form factors for energy. And then they put a slide, that if you define a problem as how do we have, the world does not has expensive energy that is very carbon centric. And has a very large form factor. That can only be built in certain places where high capital expenditure, the more you say that way, the solution is either going to be solar cells or nuclear fusion. So mostly clear what the solution is going to be. So I'm going to spend a lot of time on other slides and when we go through mentorship, etc, to me, this is like, I'm zero in on, is this a problem worth solving? And is this the person's number one problem? And if it's not clear, then do you sharpen the target customer, do you sharpen the problem articulation, do you sharpen your approach, or do you change your business entirely? Next is, what is the market opportunity? And so it goes back to billion dollar companies, if you are trying to build a billion dollar company, then this problem has to be worth at least a billion dollars or keen to someone out there. So think about what your total addressable market, what's the real target market size, being clear about what you're targeting? So for example, we talked about halal supplements, for example.
 
Well, the truth is, he's not targeting the whole supplements market. But neither is he targeting one country or two countries. So he's saying, these are all the people who have this dietary requirement. And they mostly do not buy supplements, because they're concerned about all these reasons. And therefore, I believe the total market size of this is going to be large. And you lay out the logic. So define a type claim in this case. So this person has a dietary requirement, why? Because of faith, because of choice, so on and so forth. They are probably not a child, because the child doesn't need supplements. They're probably not elderly, because they may not be clear about why you want to buy supplements. They may be people of a certain income and profile class, but these are the customers that we can see. And we can paint that picture of that. And then talk about why now? Why is this the moment for us to build and support this requirement? Now, of course, we talked about your solution demo. And so this is a slide, I find that most people end up spending the most time on this slide. I've seen So many decks, and they primarily don't talk about the previous two problems, they spend all their time talking about solutions. As we have built a great company with this technology. And there's all the things. We built a social network, built on NFTs, built on crypto, built on x using this, and that will faster, smart, etc. And then you're like, okay, but what's the problem? What's the size of the problem? So, this slide is something that most of you are focused on building. And when you do show it, therefore, key thing is to show, what does it actually look like? Which is what everyone does, but also show how someone who is going to use the platform, use the service as a really key, show how someone's going to use that thing. Paint the picture of how people are going to use it. And lastly, talk about why is it better for the client at the end of the day? Put some key. Is it better? Is it faster? Is it cheaper? So many people don't do that, here's the platform. And we don't know who the customer is. But the technology is fast. And you're liike, does the customer needed the faster?
 
So there's something to be thoughtful about. Which is thinking about what that is. So for example, we look at today, we talked about quick commerce. So a lot of folks are like, if I go on online shopping, I can get something within two to three weeks. While we do grocery shopping, things will arrive within three days. So it is there. So the question is, we do need quick commerce? if I need stuff to arrive within 15 minutes, we have to think to ourselves and say, What things do we need arrive in 15 minutes? What things do we need arrive in one hour? What things do we need to arrive in three days? So if, say, Ching Chi wants to buy a sack of rice. Does he need it in 15 minutes, or does he need it in three days? So painting the story of how the customer is using this quick commerce is going to be key. Because it lets people understand, why is it better? Because ching chi might prefer to have cheaper rice, because when you buy rice by bulk, you may want it to be cheaper, but you don't need arrive within three days. That’s why, we don't need to arrive it within 15 minutes. So it is a requirement. Whereas for someone like Kelly may require, for example, you need headache medication. Because you have a headache. And it's at 2am at night when you have a headache. So if you want to buy a headache medications at 2am, is nothing's available. And you have to get it now, you can't wait for three days for the headache medication to arrive. So that's something to be thoughtful about is what's that story of solution? How it actually plays out. Next is talking about a team.
 
So the core team is key. I actually attended a presentation on Friday, where, they didn't share about the team. And I was like, who's building this company? Photos, any relevant experiences, your leadership experiences, your education, obviously, you're right. It's a long story. But we don't want two to three bullet points. And the core of what you're trying to achieve is we want people put on this team and everything and I'm like, I get that your team is impressive. But so what? And you'll see a lot of slides where people, they write it in a way where is this facts, but it's not relevant? It doesn't tell me, why are you the right team who can do this? And both of them, met at improv class and love improv, for example. And then, if the startup was like, we're building an improv platform for the world, then that's relevant. But if I'm building a nuclear fusion platform, and the bullet point of improv is totally irrelevant. That's something to be thoughtful, to be thinking about all of time. So while you're trying to articulate share, is, say, at the end, we together have the right skills to achieve this plan. And of course, sometimes when you do the slide, sometimes its obvious, like, I want to build a great company. Let's say, Sarah and I are building a company and it's quite clear that both of us are based here, for example, but we want to build a company in France for some reason. So start off and I like we're going to build a company in France. We're both not French. No experience French, but we think is a great idea. Then obviously, the team's law is going to be quite clear, do we have the right skill set? So it'd be on us to articulate say, and don't try to pretend and try to write a lot of words and say, Jeremy suddenly knows a lot of French, but he doesn't, don't try to exaggerate the thing. But to say, we don't have the team right now but fine we are going to find it. We're going to look for a French person to edit a team, is better for us to be have that direct conversation all the time. And obviously, about traction, so performance, etc. So what have you achieved over time? So what's really key in this section?
 
What is the timeline? When did you find a company, this is a key milestone that we have achieved so far. And a lot of people will start using what are called soft traction. Which is getting an accelerated, we achieve this reward, we want to start up competition, we attended a hack launch with Jeremy and Jeremy, said this is thumbs up for the presentation. These are soft traction. But what's key is that we have hard traction, which is like, we're actually growing fast. We do have clients, we are making money. We do have brand name clients working with us, we have a growing with a future that more people want to join and look at the results. And then the next thing is, so hard traction is always more important than soft traction, then is really key for you. And that's why I talk about how as business operators, we're here to build a company as fast as possible. So if Mason, and Diona, for example, if Mason comes in with a bunch of soft traction on the slide, so number one award, both that most likely succeed, etc, by Diona is like, I already have 100 customers, and I'll give me $1,000 each. Now I was as, well, it's quite clear. Who's further along? Diona probably has a better company, because Mason is as I only have a pitch deck and a bunch of stuff. And so a lot of people are like we forget, but this crux, building the heart traction is really the core mandate. And a lot of people actually feel like it's unfair. And there's a lot of people say its super unfair, why did that person have a pitch, drag and be able to raise money, but I can't. And I'm like, because that company started four years before you and they have more results than you. So they didn't show you the pitch deck. But this is what it is. So just be thoughtful. What data are you showing here? The soft versus hard traction. And then also talk about quality of the business. So our business metrics, so number of customers, total revenue, lifetime value, decreasing cost, there's a bunch of stuff that basically shows the quality of that growth. So that's really important for you to think about. So the best companies will show like hard traction. And it'll show that there's high quality of hard traction growth, is important. And then it is all about competitors, right market fit versus competitors. So it's really important for you to show how you fit in the landscape versus competitors. And I've seen so many, I literally had an ad company. And I was like, who are your competitors in x? And then they were as, we have no competitors. And I was like, okay. So there's always competitors out there. So how do you fit into it? Why are you going to be the winner versus the direct indirect competitor? So what's a direct competitor versus an indirect company? All right, this is really key understanding. A direct competitors saying that, they look exactly like you.
 
So for example, a direct competitor could be, let's talk about the jeans. And I want to build technical jeans. It is for people who work from home, and they want to wear something that looks like jeans on camera, but not jeans. And we're talking about guys. Because guys are wearing shorts and terrible stuff. And other people dress better on average. And I literally saw startups pitching that way. So direct competitor will be a company that's tackling the same thing, which is athleisure. That's what they call it. Athletic leisure clothes, like the Lululemon. But for guys, basically, those will be exact competitors that look exactly the same. So there's a bunch of direct competitors are doing the similar approach. But actually, they're indirect competitors. And the indirect competitors is called Nike, Levi's, anything that you could wear. So there's a lot of indirect competitors, Uniqlo, they're not exactly approaching the problem for the same thing. But for a person who's at home and on Zoom, wearing pants, they can wear shorts, they can wear different things.
 
So just be thoughtful about direct versus indirect competitors. And truth is, that's really key for you be thinking about all the time. So how much capital have to raise? You got to know that at the back of your hand. Why are they good? Why they bad? But the truth is that, your biggest competitor all the times is your core, the default behavior. So the truth is, for a lot of them, what they're wearing at home is, FBTs for an army. So we're seeing that a lot. So, the status quo is like, they bought 10 of them during army. And they haven't got around to changing. So the status quo is the incumbent behavior is really key. So are you changing customer behavior? So when you say I'm going to take on and compete against them, you're basically saying, I'm trying to get these folks to change from shorts, to jeans, to change from loose fabric to tight fabric, to choose from a relatively less breathable fabric to a very breathable fabric. So those are all customer behaviors that are going to be happening, when you talk about this market fit. In general, I recommend using it as x, y market landscape. We'll talk about that. But it's basically one of those like two by twos, that talk about, which are the two most important dimensions that are really important that differentiate you from other people. And of course, thinking about how you as a result are competitive, what makes you strong, what makes you weak? What are you concerned about? What areas are you not targeting? So for many technical homeware, brands for men, a lot of them are saying like, we're never going to be as competitive as Lululemon.
 
That's why we're targeting nails for this category, because we don't have a competitive advantage against them. But we do believe as a small niche that we do have a competitive advantage, because everybody else, was key for you to be thinking about, is, of course, you should be selling that your 10x better. Now there's 3x better, 1.5x. Better. That being said, being thoughtful about whether you are actually telling us about this super key, right for that customer for that niche for that moment. You're super key. So next, we'll go top of financials, super complicated, but I'm going to assume that everyone will figure it out, eventually. But the question is, how do you make money as a revenue streams? Is pricing is a flat fee etc, is a recurring? Is there a big difference between gross versus net? Is it high volume versus low volume? What's the basic math thats there's, so sure the math, one times, two times, three times, equals six. 100 clients, they buy two brushes a year, times $3, for toothbrush, equals to, $600. So be thoughtful about how you lay out that map. And how it's going to flow from Point ‘A’ to Point ‘B’. And I was talking about how much you're spending? How much do you take to spend to buy one customer?
 
So if you want someone to buy a toothbrush, you're creating a direct consumer to brush that up. And you expect to sell $10 worth of toothbrushes, $6 two brush and $4 of toothpaste to the person, $10 a year, then you have to be thoughtful and say like, my average cost to acquire a customer should be hopefully be less than $10. Because if I spent $12 to sell someone, something for $10. I'm losing $2 on every customer. So being thoughtful about how you're spending money. And eventually, we're not going to too deep into it. But talk about how you can articulate lifetime value versus the customer acquisition costs a customer. And what it basically means is that any other day, when you buy, you're not only buying candles or toothbrushes this year, but maybe next year by 10. And then you buy 10 and on average, you stay for three years. So on average, if you will buy $30 of services from me. And on average, it costs me $5 to persuade you to buy this from me versus buying this from Colgate or other places out there. And so my lifetime value $30, my acquisition costs is $5. So the multiple of lifetime value to CAC will be 30/5=6. Why better for you to be thinking about all the time, is that if you're running a business as an operator owner, you should normally be aiming for this multiple to be true on average. You should be earning at least $10, for example, of profit, not value, not price, but value profit for every $3 that you spent, to acquire them, so that means you make $7 Eventually, and maybe there's over one year, two years, three years. But there's something to be thoughtful about all the time. As to make sure to ask for money. So that's why you're busy pitching. Or ask for people to join you, or ask for people to support you and accept your grant. So in this case, we're talking about VC, how much capital you can raise 400, 500 grand, two mil, three mil, whatever it is, your investment terms?
 
So what are the terms of investment? What's the price of that capital that you're looking for? And also be thoughtful about and sharing about what the investment history, about whats their previous investors? Are they still coming along? Where you'd like them? Something to think about that? What are the previous investment terms that were there? And lastly, how do you intend to use the proceeds to achieve? So how do you tend to use like 100, grand $500,000 seed round, 2 to 3 to $4 million dollar Series A, how you going to use that capital? And what's important for this, our ad is, a lot of people stick this proceeds and talk about who they're spending it on, spending on sales and marketing or technology. And that's important talked about but what's really important is, I am sharing the slide, what milestones or what experiments are you going to run with this capital? And what learnings are looking to understand that get reflected into the fundamental value of the company? So if I'm giving you a million dollars, you can say I'm spending it half on people and half on technology. But I always saying is, if you give me a million dollars, I'm using this to understand three things by market, I'm trying to understand, if we can get this technology to run within 10 milliseconds. Number two to find out if doctors want to buy it.
 
And if they buy it, how long will they stay buying it with a lifetime value, for example. So those are the three milestones I'm trying to achieve. These are three learnings, aperitif, which is $1 million. And these investors are basically saying, I'm going to give you a million dollars to go find out this experiment and find out, achieve these milestones. And if you don't achieve those milestones, then that's okay. You figure out the failure milestones or experiments early enough and fast enough, then you can always use the capital to change the logic chain and figure out a new business, a new approach to selling to customers. Or if you don't figure it out, or you take too slow to do it? Then you run out of runway and then the company doesn't make it and that's okay. So overall, that was a hopefully a dive into a pitch deck on each slide with the key learning of the slide to be thoughtful about and what we're going to do is to give you some stories about the pitches. I have done in the past, it does has reflections. And now I am going to q and a. so this a good time for you again in a zoom chat to pull up the q and a section and ask any questions or to upvote any questions that you prefer me to answer, and I go through that. So it is a good time for that. So it does a pitching reflections. I remember pitching, content consulting, which is a social enterprise. So someone was talking about social entrepreneurship. So I choose that story. And today, it feels like a no brainer. So I have no idea how many people come up to me and say, Jeremy, I want to create a content consulting half, coding, I want to create content consulting for ABC.
 
And I remember when I first came out with that, I knew that it could work because I've seen it work in the US. And I appreciate it and being part of that community in my university. And so that had been a transformative experience for me. And so I coming back to Singapore, I actually co founded with my co founder. He was my improv buddy. So we dug trenches together in the rain. And if you have a tree man trench that you're digging, and only you and he are only two digging, and that one is just not doing anything, you've become very good friends, because you realize that you can count on each other, and you can't rely on another person effectively. And so coming back, we decided to build this together, because we didn't exist. And we had no idea how hard it was, etc. And I end up pitching and actually have that first email, where I basically put together like, the thing and so forth, and i email it to like hundreds of people, and we were using, email at that time, there were Yahoo groups and Google Groups, that's a crazy time to say, based on Facebook, or these things, and just say, this idea, and 1000s of people ignored me, saw it and they delete because they wasn’t interested in it.
 
And I remember that we got about 30 people to show up across two days, info session then into faster pitch verbally. And I remember building a deck beforehand, to talk about the company and the mission and we finished the slide just right beforehand. And i was pitching to all the other people, and we practice, only five to seven of them were actually came back and said I'm interested in doing something, but only about two to three of them actually said yes. So actually helping out and actually helped in any degree. So you think about it from 1000s of people that we pitch via email, and say I'm interested in signing up and doing, learning more and do more after the pitch, the first, second or third person actually join. And I don't know how I felt about it, because at that point in time, it felt sucky. But I felt great. Because psyche, you're like, I embarrass myself, I email the 1000s of people. And only a handful of people believed. I also felt great, because when one person says, yes, that's amazing. And so for me, the reflection from that is pitching is scary all the time. Because fundamentally it's rejection at scale. What I mean by that is, if I go to my wife, and I say, let me pitch to you why my daughter's cute. I'm pretty sure it is 100%. In agreement, that is going to happen. And I know it's also a crowd pleaser. If I have a pitch like that, I'm sure she will say yes, I agree with you, 100%. For me to do that with more people, to do talk about saying I want to build the first case of social enterprise. I remember people saying, like, I don't believe that Nonprofits and Charities want to improve and receive consulting services. We don't believe that professionals and students want to work together to do consulting projects, we don't believe that you can achieve the quality needed to be recurring, we don't believe that you can be financially sustainable social enterprise. And to be frank, those are very valid questions.
 
Because at a time, what do we have yet? My partner and I, and that's it and a pitch deck. So those are super valid questions, and we're pitching and pitching. And the truth is, if 27, or 30, people said no to it, it's a pretty fair ratio. Because the truth is, since that time, I've actually seen a lot of social enterprises fail with similar looking decks, with similar looking pedigree, but they fail to achieve it. And I can tell you that when I was building Conjunct Consulting was a giant pain because so many times I could have made those massive mistakes. And so all those concerns were super valid, all those doubts were valid. So it's very important to think about the pitch, is not think about when you pitch, is that you're pitching to get rejected, by neither should be going around saying like, that aside audience is dumb or doesn't get it. And I get it, I'm superior, I see the future, they see the past.
 
Really think about the pitches, were you saying like you articulating these things I believe. And these are things I have to believe are true in order for this to be true. And then my job is to communicate it as clearly as simply as possible. And then is up to the market, up to people decide whether they opt into it, or whether they just opt out. And that's really important. So my first art of pitching is my reflection about the fear of rejection. And the odds, the ratio, the final say, which is your pitch, allows people to get even a handful to even be interested and let alone join. And so you have to be comfortable with pitching, don't think to yourself, I'm pitching, I'm learning to pitch one pitch. Building as I'm learning how to pitch to improve my one presentation. The truth is you're learning how to pitch 100 times the same thing 1000 times, and you're going to keep improving it. But that's what happens when you do pitching. The second time, and the last story I have before we go into Q&A and an alternate tap and see how many questions you have. I remember that I was going to head off to my wedding with my now wife, my then fiancee, and I was busy pitching for a series A for a technology startup. Pitching, and pitching. And I remember I told my wife and I said, I don't know if we can achieve this goal. And if that happens, then we're going to be in trouble. Because we had to be thinking through, how do we change our burn? We change our assumptions, if we get this series A. And, my fiancee, whom I had met at the social enterprise. That I had built. She basically told me and she said, Jeremy, if you're trying to propose that, we reschedule the wedding, no chance in heck that's happening. If you want to try to marry me, again, the ceremony, you're going to be a long, long time. And so I said to myself, Okay, great. I got to pitch harder, motivated. Because if I don't pitch and close, then I don't get money, the company folds. And I don't get married. So that's a problem. There's an incentive struck problem is infrastructure. I think one thing that is there is that when you're pitching in different stages, the way I pitch a technology startup, for a Series A, it's also very different. And reason why I'm struggling, the reason why I find it difficult, when why we mentioned measure closer, was we had to unlearn a bunch of things, and actually be articulate and say, these are the problems that we care about. And these are things we still don't know.
 
And these are the things we do know. And so finding the right investor, and finding the right team and finding the right partnership that actually believes in this story, not because they're fools, and our pitches, very good and pantomime./shadow puppet play, that makes it look good. But it's a pitch, just find a right partner for your business partner that provides you capital. And that's hard to do. Because, sometimes you have an ego, and you're like, I understand this way better than everybody else. But it turns out, the VC, the bank, if you want to decide that this is mine, as well. And it's not in your own way, in your own domain. And the other part of it is, this is a hard because it requires humility. Because he may imply that you build the business in a certain way, but you have not yet proven out certain parts of it. And that's difficult to do all the time.
 
And lastly, there's a clock. When you pitch, there’s this entropy and stuff like that. You're pitching aggressively, you're pitching people in parallel, you're pitching hard, you're learning how to pitch better and better. Because time is sometimes your friend and sometimes is your enemy. And so in some ways when you're burning money, the reason why you see startup founders are burning a lot of money when you're very good at fundraising. If you fundraise a lot of money, so they burn a lot of money. But when you're burning a lot of money, they are very incentivized to fundraise more and more money. Because time, in many ways is the enemy. Because they didn't build a strong enough business that is profitable. But you look at companies that are profitable. So you look at Atlassian, look at Buffer, you look at Canva, they build a company in a very strong and rigorous way. And because of that they didn't feel like they had a rush to learn how to pitch, they had a rush to raise venture capital. And it was much more powerful because time was their friend. Because, they wait one more day they receive 1000s of dollars more. So being thoughtful about what you have to learn and unlearn for a technology startup is really key. So on that note, I wrap up the pitching reflections. Obviously, if you want to learn more from founders, VCs rising stars, you can go to Jeremyau.com. to check out the Brave Southeastasia Tech podcast on Spotify, Apple, etc. And use that time to either listen to something. But primarily what I enjoy in this case is hearing why people care about what they do.
 
So on that note, I'm going to stop my share, and look at the questions. The question is, you mentioned a seed round is $500,000? How far can they support a startup to grow? How long? How many staff? Okay, so, let's say you build a company that is profitable already. So, you spend $5. And then you make $10 a profit. So net profit is $5. So every $5 you put in $5 more. So if you raise a C round or $500,000, then after you finish deploying it across, then one to two years, then you have a million dollars. In that case, a $500,000 C-round could have lasted you for the entire time. So this could support you forever. Now, if you choose to raise, you spend $5. And you basically only collect $1, back at the end of the day. So you lose $4 in every time you have a customer, then you're losing $4 for every customer in the short term, then $500,000 to buy, you basically sell to a certain 125 people. And then you're all our money. So something to be thoughtful about is how far can this set startup to go? It depends on the business you build. So being thoughtful about that is how long, how many stuff, it depends on how you company is build in. So don't think about how much money you raise to how far the startup can go. Now, what you may have heard is that VCs, the classic model is that every time you raise a venture round, then the goal is for you to may have that lasts for about 18 months to two years. So that's maybe what you have implying a little bit here. But it's quite dangerous, because sometimes what happens is like, I got $500,000. I have to spend it within two years. So there's $250,000. So every month that's like $20,000. I want to pay myself $5,000 for $15,000 left, so I'm going to spend 15,000 and put it all in marketing. That's one way to do it, which is working backwards. But that assumes that using venture capital is assumes that your business is vigorous and be able to do it. And it assumes that day is the best allocation of resources. So it's possible to use that approach. But it really depends. So the real crux of it is being thoughtful about what that is.