Giving and Getting Advice

I had the pleasure this weekend of judging the 2017 IBK Business Plan competition which brings MBA students from around the world in a head to head elimination competition, showcasing the next big thing. I was excited to see what creative ideas would be brought forward. Looking back at the past year’s trends, I had a few guesses on what the trending business types are going to be.

Drawing on some of my best experiences as either a judge or presenter in the past, I had a few thoughts in mind on what it takes to be a good business plan judge, and also on how to work all of the personalities in the room.

1. Understand the stage of the business

Judges often don’t read their judging packages prior to an event, and sometimes don’t realize what stage the companies are at, which can lead to misaligned expectations. In the case of this weekend’s event, the companies are mainly at idea stage. So questions like “Oh you don’t have any sales?” shouldn’t really come up, rather we should be judging these plans as feasibility studies on projects we would want to spend time on. “Uhh - nobody here has sales, it’s a business plan competition.”

That being said - it doesn’t hurt to have some evidence of sales activity or effort, letters of intents, handshakes, evidence of a list of key clients and stage of conversation, and evidence that prices have gone through one or several rounds of testing.

I found that judges were quick to criticize plans that did not have a licensing or partnership model contemplated. My instinct is that if the presenter offered a partnership model rather than a direct sales grass roots approach (for example) as their go to market strategy, they would garner criticism.

Oh boy, just be ready to explain that you’ve got a chance to grow your business both ways, or several ways.

2. Be charitable

Some presenters will be nervous, some will be polished. I have a specific recollection of travelling an hour to present on a horrible old-school LCD projector which made my deck unreadable, in front of a roomful of too many people who wanted to appear to be expert investors, asking me a barrage of strange questions. That particular event made me appear unprepared and scattered.

On the other side of the table this time, I find it’s important to be vigilant and to police the other judges, to make sure that they are asking questions and not unnecessarily showboating or sidelining. Which brings me to item 3.

3. Don’t waste the presenter’s time

It always bugs me in pitches when a question-asker (advisor) rambles on - their presentations are usually time limited, so we advisors are entrusted with the presenter’s precious time - it’s our responsibility as judges to ask fast and to get out of the way so that the companies can answer.

4. Be nurturing

When judging these competitions, I find that my mind switches into creative mode. “Yeah! I like that idea. What if you did this? Or added this?” I find that the well prepared pitches have some of the same thoughts and do a good job of sharing their go-to-market approach. My instincts will be to try to add on to the idea from the various businesses I’ve seen, which, as noted in item 3 - is something that has to be either very quickly so that I’m not wasting valuable time, or is reserved for the judge’s chambers.

5. Embrace the “moonshots”

I have bootstrapped significantly before seeking outside capital, so my instincts are not to invest in the idea that needs cash up front, but rather to seek out the ideas that are grounded in reality. In my past experience at these competitions, many teams will come forward with university IP that they wish to license to solve a major problem, with a million dollar angel round ask. Building this type of business is a blind spot for me, so I will need to look to see if the judges with particular subject matter expertise are embracing of those ideas.

6. Reward a good go-to-market approach

I certainly find that this is a challenge for companies at the idea stage - to convince the judges of their ability to deliver on an idea in a market that might be foreign to them. Press the companies on their plan for scaling. The earliest stages of business require that the judges offer a leap of faith, and that the presenters paint a picture of go-to-market and growth that is easy to follow.

For my own journey one difference between our early presentations which required a lot of viewer imagination, and our recent presentations which were demo-ready with proven customers is the degree of imagination that is required by the viewer. What I’ve learned is that it’s never good if the judges need to use their imagination.

7. Kick the stool

Although I’m charitable by nature, it’s important to push back on things that seem unrealistic. My approach in the past has been to do this quickly and surgically. It’s important not to waste anyone’s Q&A time - but it’s also important to ask hard questions and to see the presenters sweat a little bit, or shine with a brilliant answer. One of our judging coaches suggested that it’s a good idea to “kick one of the legs out from under the stool” to see if the stool stands up.

8. Argue your corner

In past years I’ve argued against this judging room for companies that I think should make it through to the next round, and really that’s the reason we’re here. It’s easy to get swayed or to make an easy decision, but going in with solid judging criteria is your responsibility as a judge to the weeks, months and years that the companies have put into bringing their ideas forward, and you further owe it to them to make sure your thoughts get across based on a well thought out judging criteria.

I was pleased to see ed tech, health tech and med tech companies that made it to the finals. But I was also pleased to get this chance to reflect.

I am just starting seed round fundraising discussions for my beloved []9, and when I look at the list above it makes me think about what I’m also looking for in an ideal investor - nurturing, creative supportive investors with strategic help. I dislike but greatly value the “tough love” because, although jarring, it’s sharpening, and when I listen carefully to the advice it’s going to save us a lot of time and potentially prevent big mistakes.

Written by Rajah. Rajah Lehal is Founder and CEO of Rajah is a legal technologist and technology lawyer who is, together with the Clausehound team, capturing and sharing lawyer expertise, building deal negotiation libraries, teaching negotiation in classrooms, and automating negotiation with software.