The Story You Tell Drives the Capital You Raise

Published on Nov 18, 2015

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PRESENTATION OUTLINE

The Story You Tell Drives
The Capital You Raise

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Four things to keep in mind as you begin to prepare your presentation to potential investors.

1. Know your audience.

Create tension in your listeners.
Psychologists characterize people by the primary process they use to make decisions. "Thinkers" tend to rely on facts and logic to make decisions using their conscious mind, while "feelers" trust values and emotions, manifestations of the unconscious mind. Of course, no one is entirely one type or the other; thinkers can feel deeply, and feelers often rely on logic. Nevertheless, your message will be more persuasive if you initially matches your audience's primary encoding.

How should your story differ for each type? Thinkers are likely to respond better to cold hard facts about the industry, company, and management, as well as irrefutable logic reinforced by statistics and spreadsheets. On the other hand, if you are working with an audience of feelers, the product's effect upon users, as well as the style of the presenter, is likely to be more important. Often, how you communicate is often more important than what you are communicating.
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2. Know your hook.

Give your audience a reason to write the check.
When telling a story, the listener's initial focus is to discern, "What's in it for me?" As a consequence, you must grab the listener's attention and stimulate your audience's need and desire to listen to your story. Professional speakers suggest you have less than a minute to capture your audience's attention, so your opening statement is critical. Since your objective is to raise money, you should clearly give your audience a reason to write the check in your first few
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3. Create drama in your presentation

A good storyteller is adept at creating tension in his listeners.
A good storyteller is adept at creating tension in his listeners, prompting feelings of discomfort and using emotions to prod the listener into action.
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Use a narrative arc.

Good stories and sales presentations generally follow a standard format of beginning ("why you should be interested"), middle ("how you will benefit by following my recommendation"), and end ("this is what you should do next"). In fiction, this format would be the 'plot; in dramatic plays, these stages would be called acts. Each act is a story within a story, and should leave the listener wanting more before the next stage begins.

Create emotional resonance.

Storytellers combine pictures, words, sounds, and music to create mental harmony or dissonance. In The Primordial Emotions: The Dawning of Consciousness, Derek Denton noted that marketers and salespeople effectively use cognitive dissonance theory, tension between conflicting positive and negative emotions, and then offering whatever they're selling as the solution to the dissonance. They also align their pitches to be internally compatible with their listener's attitudes and beliefs. Pictures and music are especially effective in generating instinctual response, a factor that should be considered when adding multimedia stimuli to your presentation. Remember, a picture is worth a thousand words when trying to make your message stand out.
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The best stories are simple.

The best stories are simple and directed to a basic need so that they are easily understood and remembered. Use precise language and minimal adverbs and adjectives to make your points. Use pictures, charts, and diagrams to convey specific points and reinforce your oral narrative. Do not use two words where one will do. This way, your audience doesn't have to think or wonder about your meaning.
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4. Resolve the tension

A good story raises questions in the minds of the audience.
A good story raises questions in the minds of the audience, creating tension during its telling, and ultimately answers them in a meaningful way so that the audience is satisfied. For example, the underlying premise of an investment in your company is that future returns will be greater than the returns currently received for the same or less risk of loss. If your story does not convince the audience that the returns will be profitable, listeners will not make an investment in your company.
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Everyone can become a good storyteller. The more skilled you become, the more effective you will be as a fundraiser.

Raising capital for a new enterprise is inevitably a trying process for entrepreneurs, and learning to interpret your audience and developing an effective story can only be learned on the job. Fortunately, everyone can become a good (if not great) storyteller - and the more skilled you become, the more effective you will be as a fundraiser and as a business manager.
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Learn More!

Andrew Schrage, Money Crashers - www.moneycrashers,com
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