Pitching Someone Else’s Business
By Matt Bornstein
In our recent business model exercise, I worked with Shereen Khanuja and Stephanie Frias on their business Hypeli. Hypeli, currently in closed alpha, is a platform that allows event planners to directly book live performers (such as musicians, DJs, or dancers) without going through a talent agent. For customers, the benefits are better selection, assurance of quality, and lower rates. For performers, the benefits are a larger pool of potential customers, simpler logistics, and lower agency fees.
As part of the exercise, I pitched the business to a prospective investor. The primary purpose was to give Shereen and Stephanie a chance to evaluate their business objectively. I also learned a lot from the experience, though, and want to share what I took away from it:
1. It’s possible to learn a lot in a short amount of time. Nothing gets your head in the game like an impending presentation to your peers on a topic you know nothing about. My knowledge of this business is still tiny compared to the founders, but I think I was able to cover the most important bases.
2. Business model & customer knowledge are half the battle. When I fielded questions about Hypeli, I relied heavily on my knowledge of other platform booking services and on my familiarity with certain user segments (brides). My answers probably weren’t perfect, but I did find I could port a lot of this knowledge from one specific business to another.
3. It’s a lot easier to poke holes than build a positive argument. The HBS case method is built on intense scrutiny of the ideas and actions of others. This may or may not be the right mode for a professional manager. But we will certainly need more creative, positive energy to start a business.
4. Identification bias sets in fast. For 90 minutes before the pitch, I was assigned to be “Doctor Mean,” putting Shereen and Stephanie through their paces. I asked hard questions and tried to draw out / clarify fundamental assumptions. I felt like the supervillain at the table. After 5 minutes of pitching Hypeli, though, I felt like an advocate & had some sense of shared ownership.
Net-net, I thought it was fun & much easier than expected to step into the role of fake founder. The experience made me think back to an in-class discussion of passion in entrepreneurship. Investors often look for founders addressing personal pain points and companies with compelling history / mythology. I understand the logic and agree with the practical need for intense, even irrational determination on the part of entrepreneurs. Building a big company is, after all, an extremely unlikely event.
I wonder, though, if passion can come from sources other than a personal story – if the simple act of jumping into a leadership role at a company can generate authentic connection and drive. CEOs of large companies are not always avid brand advocates or customers, and their jobs are hardly easy. Is the act of starting a business unique enough to require a totally different kind of passion? Passion that not only exists but has a personal, verifiable origin?
Comments
Post a Comment