Pitch Anything: An Innovative Method for Presenting, Persuading, and Winning the Deal: An Innovative Method for Presenting, Persuading, and Winning the Deal (20 page)

I reached Vinod Khosla at VC firm Kleiner Perkins, and he quickly transferred me to his analyst; an obvious dead end. I was getting nothing but rejections from the largest VC firms in North America. I questioned whether I should continue. It was a constant battle in my mind, press on or give up? But I’d passed the point of no return.

It sounds simple, but no greater truth exists in business today: Persistence pays. So I persisted. Eventual y, I was able to get four big pitches lined up with top-tier VC firms. But setting a meeting is just step one of a two-step process. You have to impress and persuade, or you go home with nothing, which I was getting good at—the
going home with nothing part
, that is.

This was a confidence kil er—I knew I was good at pitching, but for some reason, my pitches were failing. And now, I was in big trouble. I’m embarrassed to say it, but it’s a matter of public record (UCLA’s Anderson School of Management uses a case study on this deal in its MBA program), I had less than $1,000 in my account, and my company was down to one final pitch, one last chance with a major VC firm, before the cash ran out and our doors closed for good.

I tried to develop a theory to explain what was going wrong—but I came up with nothing. I had a lot of self-doubt.
What was I doing wrong? There
must be something.
Rather than make the same mistakes again in my final pitch, I decided to regroup and reorganize myself. A bit humbled, I went back to my former employer to speak with the senior partner, Peter.

Peter was another master of the universe type, and I had helped him put together a number of big deals that had made him a lot of money. If anyone would help me, it would be Peter.

I shut his office door and sat down, unsure if he was going to help or just lecture me. After I thanked him for seeing me, he said, “Oren, I’ve watched your career very careful y, and while I see flashes of bril iance, you know I’ve also identified plenty of problems over the years.”

“Right,” I said, bracing for the lecture that was to come.

“You’re just inconsistent,” he went on. “Sometimes you’re fantastic. Other times you let us down. We were always unsure which Oren we were going to get on what day.”

I real y wanted to defend myself, but I knew that nodding my head and staying quiet was the best approach—for now.

“Let’s go back,” he continued. “Two years ago, you seemed invincible. You had just helped us close Somatex, the most profitable deal in our history.”

How could I forget? Without me, that deal would have died. Guys got rich on that deal, thanks to me. “I remember it,” I said.

“You were a few deals away from becoming a partner.”

Becoming a partner, the most coveted position at any investment bank, had indeed been within my grasp. I’d also landed a sweet deal with Hershey’s that made the firm over $1 mil ion. And my work helped the firm to close several other big deals. The competition could only watch in awe and envy as we put together a great run.

“You were strong and confident and acing deals that we real y liked,” Peter said, “But. …” His voice trailed off.

I’m sure he was stil disappointed and hurt that I had abruptly left the firm, seduced by the promise of the Internet.

“I’m sorry,” I told him. “But I’m here because I’m in dire straits. I have one more chance, or this whole thing is going to implode.”

He looked at me and nodded.

For the next hour, I replayed the three failed VC meetings while Peter asked me questions. Eventual y, his eyebrows lifted, he smiled, and he broke into a laugh. He stopped me midsentence.

“I know why you seem to have lost your edge,” he said.

“Why?” I asked.

He al owed the moment to build and final y said, “Because you’re out there, on your own, and you know there’s no safety net. Son, you’re going to these meetings …
needy
.”

I snapped to attention. Of course. Classic validation-seeking behavior. Signals of desperation. No investor wants to work with a needy company run by an entrepreneur who is almost out of cash! Sure, the investor knows you need money, but giving a hint of need-iness or any sign of desperation, plainly put, is like saying, “I’m holding a bomb that could go off at any minute.” Everyone wil respond by going on the defensive. Their first reaction is—Run!

Self-protection is an unconscious reaction that comes from the crocodile brain.
This is the critical lesson of my failed pitches and the key to understanding why otherwise good deals can fail to impress the target. Neediness triggers fear and uncertainty, causing the target’s croc brain to take over—but not in a good way. Its goal is to prevent further threat by effectively blocking out the higher-level brain, which likes to debate and consider and analyze. No time for that. Threats require immediate action.

Neediness is a signal of threat.
If you display neediness, it is perceived as just the kind of threat that the crocodile brain wants to avoid.

Neediness results in avoidance.

I knew that Peter was right, and I listened careful y as he gave me advice on eliminating neediness. And although my situation was desperate, he told me to “Get some game.” In other words, find some source of inner strength, confidence, and poise. Easy to say. Hard to do.

When pitches work wel , we tend to believe that it was our great idea that impressed the target. Or that our sublime explanation of the big idea was impressive and convincing. However, when pitches fail, we see it through a different lens. In such cases, we believe that the problem lies with the target, not us. We believe that the target somehow couldn’t see the value of the big idea or that he was the wrong target. But pitches can fail for reasons that are hidden from view.

I thought back to my previous pitch, the third of the three failures. A VC group in Silicon Val ey was interested in my deal. During my cal , the representative said, “Your executive summary was good, we like your idea, and under the right leadership, this could become a large company and eventual y go public. We’d like you to come up Tuesday to pitch the partnership.”

I made plans to fly north and thought that this was my big break. When we got there, though, the circumstances felt familiar. I’d been in this position before. It was just another one-hour meeting in an anonymous office building overlooking a freeway. The conference room looked virtual y the same as every other one I had pitched in: black leather chairs, a long conference table, a whiteboard, and an easel.

Thinking back on those days, if there’s anything that reminds me of deal making, it’s the acrid whiff of dry-erase markers. In 1999, no deal could be pitched properly without extensive—and highly abstract—whiteboard diagrams.

Now, when I was pitching, I spoke clearly and made my points elegantly. I maintained eye contact with the targets, exuding calm confidence. My voice rose and fel with dramatic timbre as I drew a chart on their whiteboard so artistic that, had it been preserved, it would today be hanging in the modern art hal of the Getty Museum.

Before I knew it, 30 minutes had gone by. Although I felt that there was much more to say, the targets were glancing at their watches. I knew it was time to wrap up, and with nearly perfect comedic timing, I delivered a joke, and laughter fil ed the room. I’d nailed the pitch.

Now I found myself in that awkward two-minute period that every presenter must face after finishing his or her pitch. This is a dangerous
beta trap
and the easiest time to screw things up. Here is where smal mistakes are amplified into deal kil ers. Slight missteps can erase al the good work you’ve done in the last 20 minutes. And it’s unnerving because there’s always an unspoken directive: You need something from the target. Money.

So, during the end of that third pitch, in front of some of the best venture capitalists in Silicon Val ey, I became anxious and needy while I explained:We need a lot of your money, and we need it fast. At that point, I realized how high the stakes were. If these people said no, it would be my third rejection in a row. And the company would have almost no options left. I felt scared and anxious. I said things like:

“Do you stil think it’s a good deal?”

“So, what do think?”

“We can sign a deal right away if you want us to.”

Openmirrors.com

This is the purest form of validation seeking and the most lethal form of neediness. And that was the end of that opportunity. Just that fast, the target’s excitement turned to fear and anxiety. And of course, I failed to get a term sheet or an investment offer.

Why It’s Important to Eradicate Neediness

Plain and simple, neediness equals weakness. Broadcasting weakness by seeking validation is often a death sentence. This may sound harsh, but it is true. Neediness—displaying so-cal ed validation-seeking behaviors—wil affect al social interactions dramatical y.

It is almost redundant to criticize the concept of validation seeking any further. Simply put, there’s almost no way to get through the postpitch time period if you are needy. Let’s define validation seeking and neediness and talk about how to get through the two-minute beta trap or any other point where you might be showing neediness.

What Causes Neediness?

You can tel when you are losing your audience because their growing discomfort is easy to read. They glance at their watches, turn their bodies away from you, cough nervously, and/or close the folder they had been leafing through. There are lots of outward signs.

When you notice that audience members are uncomfortable, you feel yourself losing the deal. Your anxiety and insecurity start turning into fear, and you begin fal ing into acceptance-seeking behaviors.

The experience of feeling disappointment creates problems that need to be considered careful y. When we feel even a touch of disappointment, our first reflexive reaction is to cure it by seeking validation, which, of course, broadcasts neediness to the audience.

Now our brain is subconsciously thinking, “If I can just get them to agree to do the deal with me, everything wil be okay.” This is what our brain wants to relieve the stress and fear caused by rejection. If we are lucky and the target decides to give us the deal, al is wel again. We instantly feel better, our anxiety fades, our heart-rate returns to normal, and we feel in control.

However, in the panic moment caused by that flash of disappointment, we couldn’t help but signal neediness to our target. Chances are good that he noticed it and wil not respond by giving us what we want. What happens then? Further rejection poses the threat for an emotional catastrophe.

In practice, here is how we fal into validation-seeking behaviors:

1. When we want something that only the target can give us (money, an order, a job,) we set the stage for neediness.

2. When we need cooperation from the target and can’t get it, it’s frustrating and causes us anxiety. And audiences, at some point, always become uncooperative. Audience members turn their attention elsewhere—usual y by texting, scanning e-mail, or taking phone cal s. They al ow interruptions by people coming in and out of the meeting room. Or they cut us short—before we’ve made our key points.

3. Neediness is created inside of us when we firmly believe that the target can make us feel good by accepting our pitch and by saying “Yes.”

When we set ourselves up to need the target to accept us, we have trapped ourselves. The more we want the target’s desired behavior to occur, the more neediness we broadcast, and the less likely the target is to give us what we want. It’s a downward spiral.

4. Final y, validation-seeking behaviors are triggered in us when the target seems uninterested in our pitch, begins to withdraw, or shifts his or her attention to something else. At that moment, we have a natural fear response, and the potential for an involuntary expression of neediness is high. Fear and anxiety are emotions that are both natural and reflexive, and they are very difficult to manage. Even the most common social rituals are loaded with situations that can trip us up, so you real y need to pay attention to avoid outward signs of neediness—a reaction that surrenders your status and frame dominance.

Counteract Your Validation-Seeking Behaviors

One dramatic way to eradicate neediness involves going into every social interaction with a strong time frame that you are prepared to use at any moment. This frame communicates, loudly and clearly, that you are needed somewhere else.

But this is just a part of a broader, more comprehensive solution to eradicating neediness. Here’s the basic formula: 1. Want nothing.

2. Focus only on things you do wel .

3. Announce your intention to leave the social encounter.

Executing these three steps wil calm down the fear circuitry in your own brain. Your increased heart rate, perspiration, rapid breathing, and anxiety wil subside slowly. Once under control, you’l impress others and make them actual y come after you. Most important, the wil ingness to withdraw demonstrates a self-control, strength, and confidence that most targets wil greatly admire.

To better appreciate the importance of control ing validation-seeking behaviors, let’s take a closer look at the way others have solved this problem.

In the film
The Tao of Steve
, the lead character, Dex, also employs the withdrawal technique to maintain a high status in social situations. This technique is part of a larger Taoist philosophy that Dex uses to guide his life.

Dex is an elementary school teacher’s assistant who lives in Santa Fe, New Mexico, with several roommates. He has a huge bel y, he smokes pot, and his wild, unkempt look is the opposite of Madison Avenue’s image of the American male. Looking at Dex from the outside, you’d assume that he is
not
a social success. But surprisingly, the opposite is true.

Dex is a practitioner of the Taoist philosophy, but with an ingenious twist (which I’l explain in a moment). Taoism is an Eastern philosophical and religious tradition that originated in China around 500 B.C. It is based on the writings of the philosopher Lao-Tsu. As in Buddhism, there is a heavy emphasis on connecting with the universe and control ing your desires.