This morning the following tweet was trending globally. Paras Chopra is a Delhi based tech entrepreneur and founder of Wingify, a web platform. Although I work in an established institution, I have created my learning design team from scratch. We are currently working on expanding our impact at the university, so it caught my interest.
According to Investopedia, an intrapreneur is “an employee who is tasked with developing an innovative idea or project within a company.” As an intrapreneur, you can borrow much of the behaviours and tools of an entrepreneur, such as risk-taking and innovative approaches to build and launch your internal project. The idea of a startup pitch for a new business function set up to target a new market, such as non-traditional students, can help to justify funding from the company in the same way a startup seeks funding from venture capital.
Paras’ four elements of a startup pitch are:
- How is the product 10x better than alternatives (with proof)
- What’s their moat
- How they can acquire users profitably at scale (with evidence)
- Hustles that the team has done in their careers
The first point, how is the product significantly better than alternatives, should be easy to answer and forms the basis of what your business function does. Once you have a hypothesis, it needs testing. Testing the product to get proof of its superiority over alternatives needs to be done with prototypes and prospective customer interviews in the early stages. Once up and running, the next job is to gain as much data as possible from early customers that the product is 10x better or continue to iterate until this is true.
A startups moat is how the new business can protect its product, gain and retain market share. A startup pitch must suggest how the company can avoid or create barriers to entry that stop other companies from taking over their business. Moats might include brand loyalty, economies of scale, geographical barriers, being first, integration with other parts of a supply chain and legal obstacles such as a patent. As an internal project, it is likely that fully integrating into the organisation, geographic access, and brand loyalty are likely moats to pursue.
Shareholders don’t pay for the castle, they pay for the moat. Warren Buffet
The prototype testing should provide some data for acquiring users as, without a solid plan to build customers, the rest of the plan is not important. Word of mouth is the most reliable user acquisition method, but some form of advertising will be needed for this to scale. Popular user acquisition methods include building a social media following, paid search ads and search optimisation, and ad agencies and networks. Internal project teams can use cross-promotion with existing users from other business areas.
The pitch is about getting much-needed funding to support growth. To get people to part with money, they need to trust the team can deliver on the other three points. Many venture capital firms and large companies may be more interested in backing people than the idea. Good people will adapt and change an idea till they find something that works. It is essential to leverage what the team had done before joining the startup in the early stages. This currency will only last so long before the people expect to see what the team members have been able to do since joining the startup. Spend time developing the narrative around the people in the team to build trust that you can deliver what you say you can in the other three points.
Paras Chopra list of four points for a startup pitch provides an excellent framework for either an entrepreneur or intrapreneur starting or building a new project. By focusing on how the product is better, how it will stay better, how it will grow, and evidencing that the team can deliver this, you will build trust from internal or external investors. Can you answer these questions convincingly for where you currently work? If you can, then great; if not, you know what you have to do.