When you pitch your startup to a big investor, you’re giving a presentation that could potentially win you millions of dollars in funding and make all the sacrifices you’ve put into your idea worth it.
As any seasoned entrepreneur knows, a great idea is not enough to get you funding. You’re selling yourself as much as you’re selling your service. And ultimately, you’re selling a story.
Award-winning radio producer Alex Blumberg recently left his gigs at This American Life and NPR’s Planet Money to venture out on his own as an entrepreneur, and he’s documenting the entire learning process in his StartUp Podcast.
He recently had the chance to pitch his podcast network to billionaire investor Chris Sacca, who’s invested in Twitter, Uber, Instagram, and Kickstarter through his firm Lowercase Capital.
They met in Sacca’s San Francisco office. When Sacca tells Blumberg he doesn’t want to see Blumberg’s slide deck — which could be a crutch — and that he’d rather go on a walk and talk, Blumberg feels totally thrown off, he says in the latest episode of This American Life.
Sacca was generous enough to let Blumberg record the entire conversation and even coached him through his cringeworthy pitch. Blumberg may not have ended up with any money but he got valuable advice from a startup power broker.
Here’s how Blumberg (AB) started, his voice tremulous:
AB: Here’s the problem. In the world of audio right now most people consume the kind of audio journalism that I do, most people consume it over the radio. Those people are leaving the radio in droves, and they’re migrating to digital. They’re migrating to digital listening. The, uh, number of — the number of obviously smartphone handsets, they’re going through the roof. The audio dashboard is becoming digital. iTunes radio, podcasting, is all gonna be on your dashboard. Um. And, there’s this whole world of — so there’s all these people going there, and, so I want to start a company that will create the content for all these people to listen to, who are like, moving into the digital future-slash-present.
In his narration for the episode of This American Life, Blumberg jumps in to mock the way he uses awkward phrases like “consuming audio” and “future-slash-present.”
The conversation continues, and Sacca tells Blumberg that he shouldn’t feel shy about explaining why he can do podcasting better than anyone else, suggesting that of course that’s the only reason someone would trust someone to bring them a return on investment.
Blumberg then tells Sacca about how he plans on making money through advertisements, premium paid content, and initiatives similar to the time Planet Money sold $US600,000 worth of T-shirts through a podcast series in which they chronicled the path of the shirt from the drawing board to factory to doorstep.
Sacca eventually cuts in to tell Blumberg that he needs to tighten up his pitch, but Blumberg seems to get even more nervous. After some more struggling, Sacca (CS) asks Blumberg how much money he needs.
AB: So, it will take a million and a half dollars, I think? Um, and…
CS: Take out the “I think.”
AB: It will take a million and a half — I’m looking for a million and a half to two million dollars in seed stage funding.
CS: No, no, no. You’re looking for a very specific amount of money.
In the podcast, Blumberg says that their walk lasted for about an hour before Sacca dropped the pretense of an actual pitch meeting and turned their time into a coaching session.
Sacca then steps into the role of Blumberg, showing how he would have pitched the business and gives the perfect concise pitch. While Blumberg had pitched for about an hour, it takes Sacca just one minute and 41 seconds.
CS: Hey look, can I get two minutes from you? So here’s the thing. You probably know me: producer of This American Life, been doing it for 15 years, the most successful radio show, top of the podcasts in iTunes, et cetera.
Here’s the thing. I realise there’s a hunger for this kind of content. There’s none of this shit. There’s just a bunch of jerkoff podcasts. Nothing’s out there. Advertisers are dying for it; users are dying for it. And if you look at the macro environment, we’re seeing more and more podcast integrations into cars. People want this content. It’s a whole new button in the latest version of iOS.
So here’s the thing. Nobody else can make this shit. I know how to make it better than anybody else in the world, and so I’ve already identified a few key areas where I know there’s hunger for the podcasts, we got the subject matter, we’re gonna launch this shit. I know there’s advertisers who want to get involved with it.
But here’s the unfair advantage I have. Because of what I’ve done in my past careers with This American Life and Planet Money, people are willing to actually straight up pay for this stuff. I’m not just talking about traditional subscriptions. I’m talking we did this T-shirt experiment at Planet Money where we got $US600,000 coming where people actually gave us money to buy a T-shirt with our logo on it as part of the content, it was integrated directly. And I know we can replicate that across these other platforms.
So here’s what we’re doing. We’re putting together a million and a half dollars that’s gonna buy us three, four guys who are gonna launch these three podcasts in the next 12 months. We think very easily we could get to 3-, 400,000 net subscribers across the whole thing. With CPMs [cost of ad per 1,000 audience members] where they are in this market right now, I know on advertising alone we could get to break even but as we do more of this integration we get people texting in to donate to this stuff, buying some of this product, doing some of these integrated episodes — I know that we’re going to have on our hands here something that will ultimately scale to 12, 15 podcasts.
The audience is there. They want it. Nobody else can do it like we can. Are you in?
Blumberg laughs and thinks that Sacca’s delivery means he’s interested in it. But then Sacca gives a counter-argument, saying long-form podcasts are risky when all other media content is getting shorter, there’s a heavy reliance on Apple and Google for distribution, and the successful Planet Money project likely had a boost from people’s moral obligation to contribute to public radio — an advantage a for-profit company lacks. He also says that there is a rising number of successful news or education-based podcasts that show Blumberg’s company wouldn’t exactly be breaking new ground.
And ultimately, even if Blumberg’s idea is potentially profitable, it would be profitable within a niche market. Lowercase Capital deals with companies that are predicted to become massive and even worth over a billion dollars. Basically, even Blumberg’s polished pitch wasn’t able to instill the crucial “fear of missing out” that Sacca looks for.
Even though his pitch to Sacca failed, Blumberg keeps plugging away, sharing the lessons he learns as an entrepreneur in the StartUp Podcast.
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