I had a great time at the ESA conference in Charlotte. The energy storage industry looks, to me, like renewable energy did in 2002. I think people are starting to understand that in order to meet the RPS targets that many states have demanded will require massive deployment of storage resources.
However, in other ways, it's not clear that this is like 2002 at all. It's more like solar in 2004 or fuel cells in 1996. There is so much interest in different technologies and everyone is trying something new. Just like solar has concentrating thermal-2-axis fresnel, dish (2-axis parabolic), 1-axis fresnel, 1-axis parabolic, monocrystalline silicon, polycrystalline silicon, front contact, back contact, triple junction, CIGS, thin film, concentrating PV, and many others, and just like fuel cells had companies developing PEM, phosphoric acid, solid oxide, direct methanol, molten carbonate and alkaline cells (and others if you start getting into metal air batteries), storage is seeing the same explosion of choice.
The established players are the battery companies. NJK, in Japan, has been selling Sodium Sulpher (NaS) for years to firm renewable capacity (due to policy decisions). Recently IPO'd A123 is moving from its transportation focus to sell utility scale battery solutions. Several other battery companies were also there.
The newcomers included flow batteries and flywheels. Beacon Power, of course had a strong presence, but it was neat to see other developments in flywheels by other early stage companies present.
With the ARRA funding now deployed and the ARPA-e storage grants getting underway, it will be very exciting to see what happens in the next 12 months. Given how things have been over the last 18 months, finding a sector that looks like 2004 is welcome indeed.
Wednesday, May 12, 2010
Friday, May 07, 2010
The Hook -Part II
I must say, flying is a great time for reading and blogging. I've never been able to get a lot of work done on a plane. I find that there really isn't enough room for me to spread out with my reports, and Excel sheets, and notepad and the like. However, I've discovered that typing on an iPhone is really quite reasonable given the space available (and this time I've gotten smart-I'm writing this on the Notepad and then I will paste it into Blogger later).
So, I'd like to finish off with the second of the two important items of any pitch - the hook. Last time I talked about being prepared for the questions that people will ask to quickly discount or discredit you. This is time-saving behavior on their part because if you are worthy of being discredited it is better to find out quickly.
The hook, however, takes this the next step. Once it is established that you are no longer an obvious negative, you now need to quickly establish a positive. As I mentioned last time, although the temptation is great to dump everything you have ever done in front of someone to prove how great you are, the show-biz adage has never been more true: "Always leave them wanting more.". The purpose of the hook is to drive your audience's interest in your pitch and to make *them* want to find out more about you, and ideally make *them* want to drive the process (sale, funding, whatever you are pitching) to a successful close. While GGGR may say that ABC is "Always Be Closing", you'll be miles ahead if the other party is the one pushing for a close.
To give an example of how this works, there was an early stage company called Velkess at the ESA conference. They had a really cool video that demonstrated their flexible flywheel. Part-way through the video, just as the flywheel was about to spinup, the video crashed. He couldn't get it started, and there was an actual groan from the audience, who wanted to see how it worked. So, he quickly described it, "well, what happens next is that I shake it and it remains perfectly stable". This just served to pique everyone's interest and he was mobbed for the rest of the evening as he sat at the reception showing the video again and again on his laptop to people. IronIcally, nothing creates demand like limited supply.
Although what happened wasn't the hook, per se, it is like that. It is important to communicate a simple, easily memorable set of facts that people can quickly use to justify their further interest in your business. Communicate the excitement around this simple idea, be able to defend against quick discrediting attacks, and you will find yourself pushed to further meetings and due diligence to close the deal.
Which is exactly what you want.
So, I'd like to finish off with the second of the two important items of any pitch - the hook. Last time I talked about being prepared for the questions that people will ask to quickly discount or discredit you. This is time-saving behavior on their part because if you are worthy of being discredited it is better to find out quickly.
The hook, however, takes this the next step. Once it is established that you are no longer an obvious negative, you now need to quickly establish a positive. As I mentioned last time, although the temptation is great to dump everything you have ever done in front of someone to prove how great you are, the show-biz adage has never been more true: "Always leave them wanting more.". The purpose of the hook is to drive your audience's interest in your pitch and to make *them* want to find out more about you, and ideally make *them* want to drive the process (sale, funding, whatever you are pitching) to a successful close. While GGGR may say that ABC is "Always Be Closing", you'll be miles ahead if the other party is the one pushing for a close.
To give an example of how this works, there was an early stage company called Velkess at the ESA conference. They had a really cool video that demonstrated their flexible flywheel. Part-way through the video, just as the flywheel was about to spinup, the video crashed. He couldn't get it started, and there was an actual groan from the audience, who wanted to see how it worked. So, he quickly described it, "well, what happens next is that I shake it and it remains perfectly stable". This just served to pique everyone's interest and he was mobbed for the rest of the evening as he sat at the reception showing the video again and again on his laptop to people. IronIcally, nothing creates demand like limited supply.
Although what happened wasn't the hook, per se, it is like that. It is important to communicate a simple, easily memorable set of facts that people can quickly use to justify their further interest in your business. Communicate the excitement around this simple idea, be able to defend against quick discrediting attacks, and you will find yourself pushed to further meetings and due diligence to close the deal.
Which is exactly what you want.
Wednesday, May 05, 2010
The Hook
It's 5:40am and I'm lying here in the hotel, waiting to get up in 50 minutes after staying up all night due to jet lag. I'm listening to Genesis' "shapes" album and writing my first blog post on my iPhone (does Blogger have an app? Using Safari for this is a bit tedious!)
At any rate, I wanted to talk a little about pitching for fundrising, although this applies to many sales meetings as well. When I was visited by many companies at my old firm I was amazed at how many entrepreneurs would try to cram as much as they possibly could into their pitch. It reminded me of my first resume writing attempts in undergrad where, in a desparate attempt to look like I had more experience than I did, I would cram every part-time and afterschool job or activity onto the page. I assumed that people would view my worth as the literal sum of the activities listed. To remove one would be to lower my overall worth.
I now understand the purpose of a targeted message and I understand the truism of "always leave them wanting more". Your goal in any pitch is not to sell yourself to your audience, but, if possible, make your audience clamor to know more about you (and, ideally, think that it was their idea). As I said, this is true for fundraising as well as a sales demo. When doing this, prepare two things in mind. I call these, "the stick" and "the hook".
Busy people are usually looking to quickly resolve something and then move on. Even worse, whether you are talking to a hiring manager, a purchasing manager, or a VC, these people often have very little penalties for rejecting good candidates, but strong penalties for accepting bad candidates. An HR manager at Ballard once told me that everyone remembered if he recommended an employee who was a dud, but no one would know about a good employee that he passed up, so his incentives (especially if he had a large stack of resumes to get through) were to find ways to reject people as quickly as possible, and bias his filter towards rejecting people. This shouldn't necessarily be this way, but it is rational behavior. Purchasing agents do it, investors do it. Heck, Google acknowleges that they do it too.
So, what is "the stick"? "The stick" is the one question that a lazy/busy investor will ask, hoping to discredit a company as fast as possible so he can move onto the next one. It isn't fair, but it is quick and easy, and common. I call it this because when I was with a tracking solar startup, many investors would see the moving lens assemblies (they moved because they tracked the sun) and say, "aha! What happens if a stick get jammed in there?". Never mind the fact that most rooves didn't have sticks or trees nearby, and if they did then the shade from the tree would surely cause a problem for non-tracking solar, or the fact that a twig hitting one panel wasn't going to bring down the business. It was easier to wave it off and say, "it'll never work, sticks will just get jammed in the thing". Other famous paraphrases of "stick" statements are "So people are going to pay money to sell their used socks online?" (eBay). Or, "People are going to pay $4 for a commodity that they can get anywhere for 50c?" (Starbucks). It may not seem fair, but try to think of the easiest, most narrowminded question to discredit your business. That's "the stick". Be sure you've got an answer to it.
The second thing is "the hook". It's now 6:19, and I can say that writing on an iPhone is pretty bad for this sort of thing, so I'll talk about "the hook" in another posting.
Oh look, the sun is up! Yay.
At any rate, I wanted to talk a little about pitching for fundrising, although this applies to many sales meetings as well. When I was visited by many companies at my old firm I was amazed at how many entrepreneurs would try to cram as much as they possibly could into their pitch. It reminded me of my first resume writing attempts in undergrad where, in a desparate attempt to look like I had more experience than I did, I would cram every part-time and afterschool job or activity onto the page. I assumed that people would view my worth as the literal sum of the activities listed. To remove one would be to lower my overall worth.
I now understand the purpose of a targeted message and I understand the truism of "always leave them wanting more". Your goal in any pitch is not to sell yourself to your audience, but, if possible, make your audience clamor to know more about you (and, ideally, think that it was their idea). As I said, this is true for fundraising as well as a sales demo. When doing this, prepare two things in mind. I call these, "the stick" and "the hook".
Busy people are usually looking to quickly resolve something and then move on. Even worse, whether you are talking to a hiring manager, a purchasing manager, or a VC, these people often have very little penalties for rejecting good candidates, but strong penalties for accepting bad candidates. An HR manager at Ballard once told me that everyone remembered if he recommended an employee who was a dud, but no one would know about a good employee that he passed up, so his incentives (especially if he had a large stack of resumes to get through) were to find ways to reject people as quickly as possible, and bias his filter towards rejecting people. This shouldn't necessarily be this way, but it is rational behavior. Purchasing agents do it, investors do it. Heck, Google acknowleges that they do it too.
So, what is "the stick"? "The stick" is the one question that a lazy/busy investor will ask, hoping to discredit a company as fast as possible so he can move onto the next one. It isn't fair, but it is quick and easy, and common. I call it this because when I was with a tracking solar startup, many investors would see the moving lens assemblies (they moved because they tracked the sun) and say, "aha! What happens if a stick get jammed in there?". Never mind the fact that most rooves didn't have sticks or trees nearby, and if they did then the shade from the tree would surely cause a problem for non-tracking solar, or the fact that a twig hitting one panel wasn't going to bring down the business. It was easier to wave it off and say, "it'll never work, sticks will just get jammed in the thing". Other famous paraphrases of "stick" statements are "So people are going to pay money to sell their used socks online?" (eBay). Or, "People are going to pay $4 for a commodity that they can get anywhere for 50c?" (Starbucks). It may not seem fair, but try to think of the easiest, most narrowminded question to discredit your business. That's "the stick". Be sure you've got an answer to it.
The second thing is "the hook". It's now 6:19, and I can say that writing on an iPhone is pretty bad for this sort of thing, so I'll talk about "the hook" in another posting.
Oh look, the sun is up! Yay.
Subscribe to:
Posts (Atom)