Storytelling for Startups: The Top 5 Disconnects

Investor pitches can be challenging. Humbling. Exhausting. And as I’ve been discovering, many Israeli startup CEOs have extra hurdles to overcome. So yes, my initial post for this blog may be a bit harsh and include some unfair generalizing, but I hope it’s seen as a springboard for an open discussion about how to make these meetings and relationships a win-win, productive and profitable for aspiring Israeli entrepreneurs and their funders.

A few weeks ago I joined a startup client at an angel investor pitch. As the meeting went on, I watched the investor squirm and frown, uncomfortable and plainly annoyed with some of the answers to his questions. Despite my attempts to run interference, it was clear by the end that the meeting was a flop.

In our post-mortem, it struck me that the issues were not really deep or fundamental; they were due to cultural, stylistic, and even linguistic differences. The good news is that it’s all stuff that an introspective CEO can easily recognize and overcome. The better news is I’m sharing it here so investors, CEOs and local consultants can all sync their expectations.

1) “Yihiyeh b’seder” (literally, “It’ll be okay”). This common Israeli notion manages to sneak its way into business plans. Great for your friends, bad for business. While any savvy investor will ingest a giant grain of salt when scanning hard numbers in financial projections, it’s better practice to offer backup strategies for when reality doesn’t follow the plan. “We will overcome” isn’t reassuring.

Side note: My suspicion is that this is why (as lamented celebrated here earlier this year by my friend Michael Eisenberg) we find so many startups getting themselves acquired early on (often moving to the U.S.) instead of turning into thriving, large local businesses: The short-term payoff for creating a technology is simply more attractive than having to figure out — and execute — a real, long-term product plan.

2) Google Translate isn’t a marketing tool. Sometimes I just want to grab the CEOs by the shoulders and shake them: When you’re creating marketing copy, it’s not enough to have English-speaking parents, or three years in England after the army, or hundreds of accumulated hours of American blockbusters. If you’re trying to be precise, concise, and clever in Hebrew, you will destroy your linguistic artistry by translating it literally using the words that technically fit. Way too often I’ve been asked to do “just a quick final pass” on a business plan or PowerPoint (being used tomorrow…always tomorrow!), only to discover that it needs to be completely reworked to sound natural. It’s a no-brainer: English-speaking marketing experts can create a Branding Bible of messaging texts to call on for every case. And hey – please don’t be insulted. We Anglos have been on the other side of the table since we got off the plane! You’ve had your smirks…

3) The thing about competition… Maybe it’s our obsession with being the international outsider, but go figure: Israelis don’t like to have to justify their existence. When pitching an idea, business plans very often (correctly) list competitors and similar products in an effort to explain that there is a solid market and ecosystem for what they offer. It’s actually good practice and helps validate (the “what aisle, what shelf?” approach) and classify an offering. What’s generally missing at the end of this section, however, is a clear categorical explanation as to why the proposed offering is both unique and superior to what’s out there. Establishing that there is a market means that you may take a piece; establishing that you’re better than the rest implies you’ll take the biggest piece.

4) Be my friend. Once again perhaps a craving for validation, Israeli investor pitches and business plans generally place way too high an emphasis on partnerships that will truly drive the business. Partnerships are hard to do. They’re expensive. Time-consuming. There’s a lot of competition for the right matches. And the worst part: they often don’t even yield what you hope. Any company relying on a partnership as a primary rather than supplemental driver is a company that doesn’t have enough confidence in its own product to go it alone. (The exception, of course, is a product designed from the start to supplement a larger company’s offering, where initial funding comes from this potential acquirer from the get-go.)

5) Too much, too soon. Having an extensive long-term plan is terrific. Even mandatory. But it should be labeled as such: The Vision. A product description that includes a wide variety of audiences, a wide variety of features for those audiences, and a wide variety of benefits based on each feature for each audience, implies that you will need serious marketing and product management efforts to bring all these pieces together: messaging, communication tools, tracking, and even different people to manage each market. Keeping the initial launch limited makes it easier to understand and accept by investor and customer alike. As long as the vision of the future includes new potential directions and opportunities, an investor will know that you will be ready — as Israelis actually do so well — to executive a pivot and adapt on-the-fly as circumstances require.