PITCHING AN INVESTMENT IN A BLACK BOX
Karl Dakin
I help you overcome challenges to raising capital. Take advantage of my Motivated Money Method to identify those investor candidates that are most likely to invest. Top expert in fundraising.
CONTENTS
?·?????? Weekly Edition
·?????? Donor Campaign
·?????? Quick Calendar
·?????? Funding Point
·?????? Capital Coach
·?????? Successful Funding Show
·?????? Don Cohen Show
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DONOR CAMPAIGN – CAMP WAPIYAPI
?ONE DAY REMAINING! I am conducting a donor campaign to benefit the charity Camp Wapiyapi through my participation TOMORROW in the 5K race (run, jog, or walk) of the Colfax Marathon event on May 18 and 19th.
?Using my Motivated Money Method for raising funding, I created a list of targeted donor candidates representing people (1) I know and (2) whom I believe would respond positively and quickly to a request for a small dollar donation.
?I launched the 18-day campaign on May 1 – a sprint – by sending the first in a series of emails (Stage 1) to my list of 73 individuals to be followed (Stage 2) by in-person contact.
?I am close to my goal.
?QUICK CALENDAR
?I quickly list here upcoming opportunities where I will be sharing information, lessons in funding, or meeting in person or via videoconferencing.
?May 20 – Cohen Show at 9 a.m. MDT on LinkedIn Live – I will be a guest on Don Cohen’s show.
?June 12 - SuperCrowd Chicago – Workshop on Crafting Crowdfunding Offers
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FUNDING POINTS – PITCHING AN INVESTMENT IN THE BLACK BOX
As described in yesterday’s edition of my Instant Funding newsletter, I am often asked to help raise funding for innovative products and services. These greater funding challenges call for helping investor candidates wrap their minds around something new that provides value. The goal is to get the investor comfortable enough with the innovation that they can see and appreciate the market and assess its potential.
Some innovations will exceed the ability of nearly all investor candidates to comprehend. This is partly due to their training, experience, or lack of a foundation to geek out on the technology, or it may be due to a simple lack of time and energy to become educated on one more thing. In either case, the small business finds themselves trying to raise money for what is sometimes referred to as a ‘black box’ – an almost magical thing that defies description.
The inability of the investor candidate to appreciate the novelty, the scientific principles, and/or the engineering mechanics that represent the product or service is a barrier to reaching an investment. This barrier is surmountable. It happens all the time. As we can see with the current euphoria over artificial intelligence, a lack of understanding of what it is and how it works has not kept people from throwing money at AI companies. Similarly, I still see people using the words cryptocurrency and blockchain interchangeably without understanding the major difference.
When an innovation achieves black box status, the small business should focus communications on the outcome or output of the use of the product or services instead of trying to explain the unexplainable. Explaining output is simply measuring the benefits of application of the innovation. As an example, an innovation may save time or money, may improve productivity or some other result to which value may be assigned.
However, small businesses often stop with a statement that their products or services are ‘better’. They fail to quantify or qualify the results, placing the burden on a customer to do so. In a similar fashion, small businesses often pitch an investment as making the investor rich without breaking that down into a return on investment, internal rate of return, or other monetary or non-monetary benefit.
Leaving a customer or investor prospect without a specific statement of result leaves them to do the work of figuring it out. The small business may find it difficult, or even impossible, to assign a value because the value of an application of the product or service may vary with the consumer. One consumer of a word processing software may write down a recipe while another may write a best selling novel.
Leaving this work with a prospect will commonly cause them to go elsewhere where the information is readily provided. Prospects will rely upon wrong or even false information without verifying its accuracy.
A small business pitching an investment in a black box innovation must also deal with all of these challenges by providing examples that match up with one or more of the investor profiles.
In my work with AeroCine Ltd, it offers cold plasma equipment to deter airborne transmission of pathogens. Since the equipment transforms ordinary air into a highly energized state toxic to pathogens, the customer cannot see the outcome without specialized lab equipment. To pitch this company, I need examples of a doctor’s office, a residence, a poultry farm, a dairy barn, a restaurant, and other places where people or animals congregate. From a scientific standpoint, all buildings are just buildings that may employ this technology, but the end customers and the people who invest in the businesses serving these customers want demonstrations that match them as closely as possible. These demonstrations need to include an economic analysis of when a product has paid for itself through cost savings or increased earnings. The demonstration should be typical of a class and not of exceptions.
The small business should attempt to have benefits measured by labs or agencies with a reputation for integrity and no skin in the game. Hard data is preferable over anecdotal information, however customer testimonials often win the day over other forms of benefit verification.
The small business should draft its pitch to its priority list of investor candidates and test the pitch to make sure that it is understood and appreciated. Starting a capital campaign over after discovering that no one is getting the message is very expensive.
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领英推荐
CAPITAL COACH
?I am now field testing the Capital Coach, an artificial intelligence learning management system avatar (AILMSA) that I have trained on the topic of funding. The Capital Coach is embedded as a widget on my Dakin Capital website at https://dakincapital.com/CAP . The Capital Coach represents a proprietary data set on the Knowledge Avatars learning management system with licensed access to Open AI. Could you give the Capital Coach a try and ask it questions about funding?
I am working with Knowledge Avatars to make CAP the ultimate tool to support small businesses and community projects in raising funding. Two current challenges are (1) training the AI avatar to match specific funding situations and (2) explaining that a highly personalized AI avatar is so much more than a chatbot powered by a Large Language platform. Unique, non-public information about an individual or an organization cannot be obtained through a chatbot. The recent advances in AI have narrowed the field of prospects who stand to gain from personalized AI to high net-worth individuals, professional service providers, organizational leaders, and other similarly placed who work with fast-moving, fast-changing information that may never be public.
Please share your feedback. Karl Dakin at [email protected]
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SUCCESSFUL FUNDING SHOW
Tuesday, the Successful Funding included guest Steve Shaff . Steve is the leader of Community Vision Solutions that manages community engagement. We discussed various issues in access to funding by communities.
You can see a recording of the show at:
The Successful Funding show on my LinkedIn profile will repeat weekly at 8 a.m., MDT on Tuesdays. You may register to attend by going on LinkedIn, searching for Events, clicking on the Events button, searching for Successful Funding, and then clicking on the Attend button. You should receive an email with a link to save to your calendar. You can also click the Share button and obtain the URL link to the show to put it in your calendar.
You may view all of the Successful Funding shows in my Posts on my LinkedIn profile at: https://www.dhirubhai.net/in/karldakin/
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DON COHEN SHOW
Wednesday, I was a guest on Don Cohen’s show, where we talked about community – using the digital definition, which is not limited to a geographic area but includes any series of interactions of people based upon commonality. You may see a recording of the show at:
I enjoy being a guest, engaging in conversations with other guests, building communities with Don, and using LinkedIn as a communication channel. Every show is its own adventure as we start with a word of the day and then see where the conversation goes from there.
Don is an expert on LinkedIn, particularly on the use of Live streaming to build brands and communities. We will discuss using LinkedIn as a social media platform for building communities that support raising funding.
All shows where I have been a guest can be viewed on Don Cohen's LinkedIn page under Posts.
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This Instant Funding newsletter is now available in a Daily Edition or a Weekly Edition. You may choose between this Edition, published seven times a week, or the Weekly Edition, published once a week. If you already subscribe to the Daily Edition and wish to change, just ‘unsubscribe’ and then ‘subscribe’ to the Weekly Edition.
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Karl Dakin, the Capital Coach
Dakin Capital LLC
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I help you overcome challenges to raising capital. Take advantage of my Motivated Money Method to identify those investor candidates that are most likely to invest. Top expert in fundraising.
6 个月Are you pitching a 'black box'?