Just when I thought I had a good pitch together, I had to mess around and get more opinions on the matter.  It seems it’s not enough to just have one trick up your sleeve.   When Tim Wakefield (Red Sox, not a fan or anything but the guy is good) steps to the mound, he doesn’t throw the same curve ball over and over,  he switchs it up.   You have to know who you’re pitching to and how to get past them.  While my initial pitch was quite suitable for its purpose, I have yet to pitch to any resident silicon valley VCs.   Pitching to that crowd is a whole different ball game.
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I know, broad question right?  As I continue to dig into our financial pro-forma, to ensure that all revenue/cost figures are current before I hand it over to 4corners, I just can’t see how you can’t develop profits in the broadband video market.  Every time I look at the margins and costs involved, even when using improbable absorbent cost figures, the financial sheets always project that we will see initial profits within one year of operation.  This is not normal for a start-up; normally it should take years for investors to see a return.   Of course success is completely contingent on the number of unique visitors a website attracts, but to date there hasn’t been one major broadband video site to attract less than 600k unique visits in a month.  I think market costs were about 5x as much only about 18 months ago, so maybe it was just harder to be profitable in the past, but by our measures if you have good advertisement relationships and a reasonable overhead, 1.8-2M views in a qtr should leave a video company on the cusp of profitability.   Every major site, even those that have failed in the long-run, has at some point hit over 600k unique visits in a month.  However, at that point, a particular site either engages users and continues to grow rapidly, or it losses.  There is demand for online video, so there is no shortage of users to drive unique visits. It seems success is completely dependent on the quality of the product presented.
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I caught the subway down to wall st. today to meet with an up and coming niche content site, DramaFever.com.  I arrived a little early to this fancy coffee shop called the “financier”.  It was like Starbucks with a french twist.  I didn’t really want anything they had on their menu, but it seemed i had a few minutes to wait, and I didn’t want to just appear like some bum taking a breather in their sitting area, so I got an ice coffee.  For some reason i thought it was going to taste like the iced coffee or thai tea I used to have back in my Univ of Michigan days, but i was quite wrong.  It tasted terrible, its apparent I’m not a coffee drinker on any level.  Just as I was going for another gut wrenching sip, I was in luck, the Drama fever crew had arrived and I could just let the cup sit as decoration.

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I don’t think we’ve covered this topic yet on the blog, but I figure there is no better time than now.  Recently we’ve had the chance to go out and spread the word about Motown.  In general we’ve been well received but, depending on the execution, the all important elevator pitch has garnered different degrees of curiosity.

The first time I found myself pitching the idea, it turned into a 5mins spiel, at the end of which the people in front of me still didn’t completely understand the business.  Now I could easily answer their questions and describe the products value to their application, but the only I was only able to carry such a long conversation due to my environment. In this particular situation I was amongst people genuinely interested in broadband video.  However, I won’t always be so lucky to have that audience. One of the people I was talking to was kinda enough to notice that I need help with the elevator pitch. So he gave me a chance to sit down with him and just throw 6 liners at him.   To be honest, I still don’t think we have the elevator pitch as concise as it should be, but with a little more help and experience we’ll be all set to go.  For anyone looking to learn the art of the elevator pitch, I recommend Venture Hacks, check out this blog entry from them.

The elevator pitch is important for any company that is in the midst of VC introductions.  You really need a concise message, I’d say 180 characters or less, that can deliver impactful insight about your said venture.  It’s how you get your foot in the door.  We’ve been lucky enough at this point to already have our foot in the door, and thus we jumped straight into the Deck Pitch (I guess i’ll write on that later as well). Nonetheless, until we have the appropriate funding in hand, I want to have all my tools in order to execute on a pitch.

Over the weekend, I sat down with a friend of mine who had been following the Initiative since its inception.   As an extremely experienced and web-networking savvy character, he of course has a lot on his plate all of the time, but it has been my goal to pull him over to the Motown side.

For the first time, we sat down and I willingly “opened the books” per say, and gave him a glimpse at the future of our broadband website.  He was instantly intrigued, and on the spot  began to analyze the code of competitor websites.  In just one hour, I gained a new understanding of how to succesfully deliver an immersive video experience, and more importantly monetize it. For example, we found that some websites we thought were competitors actually lack a sufficient revenue model, since they are simply embedding content from other sites and serving it up to their site viewers.  No video website can be successful with just banner ads and pre-roll in-video ads.  In anycase, point of this entry is… we offically have a Chief of Technology (CTO).

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When developing a business it’s important to remain honest with yourself and the team that surrounds you.   I’ll be the first to say, in the long run, I probably will not be CEO of the resulting company.   The skill set needed to run a $100M company is quite different from what is needed to run a few million dollar start-up.  I personally have never labeled myself as true business man, I think that comes with more than the 10 years of experience I have.

I’ve always felt more comfortable with labels entrepreneur and visionary.   In the past, I have worked with teams to bring innovative products to market, but this is the first time I will have put my “businessman hat” on to devise an innovative revenue model.    So while I am still learning, and plan to continue steps towards the label … businessman, I believe my long term role with Motown Initiative, and its resulting business venture, will remain in the thought innovation department.  Developing new product features, strategic alliances and market strategy, those are my specialties.

Who know’s, I could be wrong about myself.  Maybe I will continuously grow and develop into the person that the company needs at the helm.  We will see, only time will tell.  I think I prefer that a seasoned CEO step in though, that will let me stick to the fun stuff haha.

With that said, I recommend that you perform a self-assessment and ask yourself, would you take the CEO position in the company you started?

April 6th, 2009…. After 2 months of developing upon my broadband video vision, I though it was about time for me to start getting my hands dirty with a comprehensive business plan. I’ve complete my competitive analysis, so I understand the market, but its time to take my high level vision and really detail how the idea will become a business.

Over the past week I complete an industry overview section for the business plan, and what I found is that there is currently one major challenge to the broadband market.  How can ad revenue be increased in the market?

While I know that my team has devised some viable solutions to this challenge, I also know that we plan to deliver so much more than just a revolutionary advertisement platform.  The question is can we successfully pitch such a complex idea to an investor.  Will they believe that we can actuate on our plan considering so many experienced teams have, in a sense…failed?

I’ve decided to spend the next couple weeks in search of a short phrase that can concisely communicate what Motown Initiative’s website will offer. If I can’t figure out a “pitch line” of sorts, I am going to adjust the scope of this project.  Maybe I’ll just focus specifically on developing solutions to the ad revenue model.  There are few competitors in that line of business, and it is the core component to my current business strategy.  Regardless of what direction I decide to take with Motown Initiative, I do know one thing, the social mission will not be lost.  Revitalizing Detroit remains the end game.