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Five tips for pitching at a venture fair

on June 13, 2012 Source:

Gearing up for a venture fair to pitch your company’s medical device or therapeutic can be a nerve-racking experience, but it’s also a moment of truth for a company to get an indication of how investors respond to your company.

Among the panelists at a recent seminar organized by BioStrategy Partners in suburban Philadelphia were a couple of organizers for these venture fairs. Jaine Lucas of Mid Atlantic Diamond Venture Partners and Marc Kramer of Angel Venture Fair discussed some of the coaching and other assistance they give to startups, but they also offered lots of constructive advice for entrepreneurs evaluating whether they are ready to present at venture fairs and what their priorities should be. Joshua Tarnoff, Complexa CEO, shared some insights as a serial entrepreneur. Tim Pelura, Immunome CEO, was the moderator.

Do your homework. Before you start submitting applications to angel and venture fairs, do your research. Will there be investors relevant to your niche? Investors tend to return to fairs where they have found good investments. What types of companies will be pitching? How rigorous are the criteria? Also important — how much will it cost? One investor forum in New York costs $15,000, but most are four figures. Companies make money recruiting startups to their investor forums, so what are they giving you in return? You’re a startup after all; you have other expenses, so it’s important to make the investment worthwhile.

Think about going to an event outside of your community. One person at the event said he deliberately went to an investor forum outside of his region because he wanted to get the experience of trying out his pitch before going before angel investors in his own community. For example, OneMedForum in San Francisco, a biotech and medtech venture fair, is timed to coincide with the JP Morgan life science investor conference in January. East Coast angel investors tend to invest locally, within commuting distance. That’s a different frame of mind from West Coast and particularly California investors who tend not to let geography get in the way of an investment.

Do you have a compelling value proposition? Having a compelling story to explain why you decided to start a company to develop a particular medical device or drug can be critical. For example, you may be developing an orphan drug that by definition is for a relatively small market, but this could be for an unmet need or significantly improve the lives of what is likely to be an underserved population.

Don’t get hung up on valuation. Investors will inevitably ask you about your company’s valuation. In the first round, avoid talking about it. Although you might have a strong opinion of what that is, this kind of information is best deferred because inevitably you will have a higher valuation of your company than the investors.

Don’t make getting financing your only goal of pitching a venture fair. Look at it as an opportunity. You may not be funded, but you’re likely to learn something, be it about the questions your product raises, investor concerns, potential leads and introductions. You might find out about a new market you hadn’t previously considered or get additional insights into other investors you could be pitching.

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