One of the brightest and most talented people I ever worked with was so smart and quick-minded that she could tell you anything and everything about her business off the top of her head at a high level.  I will call her Elise (not her real name) so as not to disclose her identity.  Elise could drill down into the details in response to the most challenging of questions, generate excitement, and garner true interest from prospective investors, clients, bankers, and other stakeholders.  The business case was strong and Elise as an entrepreneur had all the right stuff.  Then, when asked to follow up with a pitch deck or a plan, she became paralyzed.  Yes, there was tremendous knowledge and experience, and incredible ideas inside Elise’s head, but when asked to put it into a tangible presentation on digital paper (saving trees here!), the momentum stalled.

When investing in a young and growing business, entrepreneurial leadership team is the most important piece of the puzzle.  Company founders are visionaries.  They boot strap their businesses and put it all on the line.  When it comes time to bring in outside funds, family, friends, and trusted advisors validate the founder’s vision with financial support, advice, and make introductions to potential investors, clients, vendors, and other stakeholders.  Much of this can be accomplished on the strength of the entrepreneur’s vision, passion, and personal relationships.  Then, there comes a point when outside help is needed to fuel the growth of the enterprise.

Re-enter Elise.  You can’t help but get excited when you hear Elise talk about her business, the vision, and the pathway to an impactful and important place in her industry.  The challenge was, how do you take that excitement and translate that into something that potential stakeholders will understand, appreciate, and buy in to?  After empathizing with Elise’s angst, she said to me, “it’s all in my head…I just can’t get it out onto [digital] paper!”

An entrepreneur wears many hats and must take on certain tasks and responsibilities outside her core competencies.  Elise knew how to get things done, but she was stuck.  The thing is, while that was hard for Elise to admit and address, she knew she needed help.  Thankfully, I had a lot of experience in this area and was able to take enough “dictation” from Elise, where she could just relax and tell me about her business in detail, and I was able to construct a pitch deck and projections, which she was able to use to tell her story to prospective stakeholders.  Numbers, graphs, flow charts, infographics galore came out of Elise’s stream of consciousness, and she delegated that seemingly insurmountable task to a trusted friend in me to take her vision and translate it into a cohesive set of presentation materials that illustrated her story.  The end of the movie is that Elise went on to raise substantial amounts of capital and built a very successful business with a leadership team that has the necessary skill sets to continue to scale the enterprise profitably.

Why does a business need projections and pitch materials? There are many important reasons:

• In the early stages of a business, investors bet on the founder and the leadership team. The performance of that team will hopefully translate into positive and impactful results.  While one can appreciate and acknowledge a skilled leadership team, the business must translate that vision into numbers and projected future returns to attract investors, particularly when raising capital outside of family and friends.
• The process of creating projections has tremendous value to the founder and the leadership team, and it compels them to look at the business critically to understand their costs, scalability, strengths, weaknesses, opportunities, and threats. It’s a healthy exercise to prepare and update projections periodically as the business model evolves and proves out in practice.  Business and economic conditions always change.  It’s healthy to incorporate this as a periodic team review of what worked, what didn’t work, and where things are headed.
• As a business evolves, projections are also helpful in attracting new investors, vendors, industry partners, clients, banking relationships, and governmental interest on many levels.
• A solid set of projections with clearly articulated assumptions, an engaging pitch deck, and cohesive and consistent company messaging are essential to building the credibility and brand equity for an enterprise.

When I was in graduate school I remember being encouraged to “show not tell” in my writing.  In the case of a growing enterprise, I believe it’s important to do both SHOW and TELL.  Nobody tells the story better than the company founder, like Elise!  But you can do Show and Tell on a whole other level with a well thought out set of projections, pitch deck and other materials that help articulate the story.

The moral of the story is:

• It doesn’t need to be all in your head, let it out!
• Ask for help from trusted sources and take a load off.
• This can turn out to be a case where 1 + 1 is greater than 2.
• Show and Tell is time tested and proven from grade school, to grad school, to building a successful business.