Demo days are wonderfully efficient. Investors listen to many pitches in a short period of time. Founders access a broad group of investors with just one brief pitch. Because of the demo day’s predominance as the startup showcase, I’ve been thinking about how we might hack them to increase their effectiveness. In my view, these demo days have changed in two major ways.
First, presentations have been reduced to a science, nearly a MadLib. “Hi, My Name is Tom and this is Geoff. We’re Redpoint and we’re pursuing the $17 billion dollar venture capital market. Venture capital is broken and we’ve built a tool to make capital raising more efficient. Over the last 3 months, we’ve helped companies raise $500,000 (chart pointing up and to the right)… If you want to be part of the revolution, come talk to us during the break. We will be wearing french cuffs.”
There’s a brillance to this type of template: it conveys all the information investors require succintly.
Second, demo days have been increasing their CPPH or companies pitching per hour. The first YCombinator classes featured 15 or so pitches. The most recent showcase 65+ companies in a roughly equivalent amount of time. Given rising CPPH and the broad use of templated pitches, it’s incumbent upon founders to differentiate. It’s also important for investors to note key points, evaluate and prioritize investments. After 60 pitches, it’s a challenge to remember the first 10 and therefore a challenge for presenters to imprint their message into the memory of the investor audience.
For a founder, hacking the demo day today means finding a way to differentiate a pitch. Some use humor. Others perform stunts. Or impress with data. For investors, hacking the demo day means getting an early look at companies pitching by obtaining a list of companies presenting and performing a first pass filter for a match with a fund’s priorities. At least, these are the patterns I’ve observed.
I’m curious to understand how founders think about demo days and what changes, if any, could be made to improve them.