This blog was originally published on Wharton Magazine by our co-founder and CEO Ryan Frankel.
VerbalizeIt’s co-founders will appear on ABC’s Shark Tank this Friday. We invited one of them to share the four keys to startup pitching that he learned preparing for the show.
After the harrowing experience of being unable to communicate with a doctor during a trip to China, I wanted to help eliminate language barriers by offering real-time access to human translators using the power of technology. Kunal Sarda, WG’11, and I started VerbalizeIt during the first year of my Wharton MBA. Some months later when we were ready to raise capital, the Wharton Venture Initiation Program (VIP) team alerted us about an opportunity to apply for a spot on Shark Tank, the popular ABC show that gives entrepreneurs the chance to pitch their ideas to veteran investors.
To vie for the opportunity to be on national TV, we took several important steps that not only landed us a spot on the show but helped us generate an exciting outcome:
We did our homework. Before we stepped in front of the sharks, we conducted extensive background research to better understand how they could add value to our company. This meant finding out whether each investor had industry or functional expertise, had invested in similar ventures, or had particular investment objectives and requirements. Understanding precisely who we were dealing with helped us craft a story and boosted our confidence before going in front of the sharks. We now do this before meeting with any potential investor.
We emphasized what makes our business unique. While it often seems obvious to us that we have a unique value proposition, it was important to remember that someone hearing only a brief synopsis of our business may not immediately be clear on how we differ from the competition. It was critical to explain this in clear language. In our case, this meant addressing how our global community of human translators provides greater accuracy and quality than automated translation alternatives.
We didn’t ignore the naysayers. It is common practice to tell entrepreneurs that they should “ignore the naysayers.” But before going in front of investors, it is a good idea to seek out critics of your business model and understand their perspectives. We asked several people in the Wharton community to poke holes in our ideas. We then prepared a strong response to their feedback and solutions for every skeptical point raised. A good investor’s job is to ask tough questions, and a good entrepreneur’s job is to have a ready answer for each one.
We showed our progress on the path to success. Though VerbalizeIt is still young, we’ve found it effective to identify the successes we’ve already had, before explaining our future potential. Investors have often told us they view our ability to hit past milestones and launch translation products for consumers and businesses as indicators of our ability to execute on future goals. Because VerbalizeIt filmed our Shark Tank pitch only months after incorporating and before we had a working iPhone app, we tried to impress the judges with the team we had assembled and a virtual demonstration of the product we had fully designed. Showcasing wins gained us more respect from the sharks and investors down the line.
Editor’s note: To find out what happened when Frankel and Sarda pitched to “the sharks,” watch the season finale of Shark Tank on ABC this Friday, May 17, at 9 p.m. EST.