Beyond the Pitch: How Smart Questions Secure Funding & Partnership

Hello and welcome to the show. Today We're still on the young boys and young girls out there. OK, well, maybe even old or middle-aged young men and women who are thinking of starting a startup this year to try and improve the financial situation. Let's just put it that way. But before we begin, the usual apologies about and about. So let's expect to have some interruptions and I'm still going to be clearing my throat because for some reason even though I'm done with the antibiotics, I I think the sore throat is still not quite gone.

So I might have to go back to the hospital soon. But anyway, yeah, so let's head straight into it. So today I want to look at the kind of questions that you need to help you secure funding and partnership from investors. I know I've done an episode where I assume I've done an episode like that in the past, but we have well over several 160 episodes on the podcast at this point and there seems to be a renaissance when it comes to,

or rather a revival when it comes to Nigerians starting start-ups, especially people in the fintech space. So I guess it's time for the topic to receive a facelift or a makeover, at least on the podcast. So the sorts of questions that you need to secure funding and partnership. Now for those of you who are in the start up space, especially those of you in the tech space, I know that some of these things might sound strange to you because what you guys have been told routinely for a very long time is you want a start up.

What you should be paying attention to is the pitch tech. So if you check different podcasts, you go to, different incubators or looking at different learning materials, what you'll find is that everybody is trying to pump you full of information about pitch deck. So five steps to get the perfect pitch deck, 20 ideas to include in the perfect pitch deck, 50 things to do to be sure that you can get $1 billion funding for your, you know, whatever.

And everything is built around the pitch deck. Now, I'm not here to say the pitch deck is not important, the pitch deck is important. But I'm trying to get you guys to pay attention to the important stuff that happens before you compile the pitch deck, before you get information that goes into the pitch deck, there's certain conversations that you should be having. There's certain questions that you should be asking that will give you the data that is going to inform the kind of pitch deck that you're going to throw up in the PowerPoint or in the meeting, or you sent the e-mail for the person that you hope to get the funding from.

So I'm not saying the pitch deck is not important. You know, a matter of fact, I'll say the pitch deck is not important because you can have these conversations and secure the funding without a pitch deck. But anyway, the modern convention seems to be that you need a pitch deck. So go ahead and get your pitch deck. But the most important thing that you have to pay attention to, the questions and the conversations that you need to have beforehand that will inform the pitch deck.

So the pitch deck is not just magic. So yes, pay attention to all those people who are promising you the five principles that will help you build the solid pitch deck or the 50 tips that you need to secure 1 billion naira and all of that. Yeah, pay attention to those folks. So take whatever document it is that they are proposing. But this is how you're going to tweak that document, and this is how you're going to edit that document by the questions and the conversations that I'm proposing that you ought to be having.

So before you dive into the pitch deck, the secret weapon is qualifying questions and discovery questions. Now, if this is your first time listening to the podcast, that sounds like Greek, so don't worry, I'll give a brief explanation. But I would recommend that when you're done listening to this episode, look for the older titles here. Yes, I know 760 episodes is quite a lot to scroll through, but just keep flipping.

When you're done, go to the menu, use your thumb flick couple of times 567 Eventually you will see an episode that has qualification or discovery or conversation framework or selling framework in the title. Listen to that episode and you're going to get some more ideas and a better understanding of what it is that I am proposing in this episode. So qualifying and discovery questions, qualifying and discovery conversations,

qualifying and discovery frameworks, whatever it is that they're called, what are they now? These are the questions or these are the conversations that allow you to get information about the person in particular that you are talking to. Lots of people are creating this pitch deck, pitch decks, assuming that all investors, all investors are the same, but they're not. If you're going to make a pitch and you're sitting before Dangote, Dangote is a different person from Michael Adenuga.

So is his name Michael? I can't remember any Adenuga. So for those of you who are not Nigerians, Dangote Oakwell, both of them are billionaires. Dangote in the What kind of space should I call that? Well, cement. He's into cement manufacturing and then he also produces some staples like salt, sugar, salt, sugar. What else? Salt, sugar, spaghetti. Well, anyway, you guys, you get the idea. So he's a billionaire, that space, but he's a northern gentleman.

Then Adenuga billionaire as well, some people say not as many billions as as Dangote, but he is is in he's Yoruba and his interests Yoruba. So that's western part of the country and his interests are more in banking, banking, oil and gas. I can't remember what else. So you can see that yes, you're talking to people, both of them are billionaires, but that doesn't mean they should receive the same pitch deck because they are different people, different religion, different parts of the country, different business interests, different investment horizons.

I mean, you guys get the picture. So why do you assume that you're going to go and get some magical pitch deck that has five magic principles of 50 whatever? And that document is going to solve your problem regardless of whatever it is that you're pitching to. You need to have conversations with that person or with other people who know the person. If you try and figure out the person in particular that you are going to be talking to or that you're going to be making a presentation to, then you're also going to have conversations with the person or with someone who is close to the person.

Or with people who can give you some hints about the person, about the opportunity or the problems that you guys are going to be talking about, the opportunity that you're bringing to the table and what their own interests in those opportunities the business face. The problems might be. You need to have these conversations, all these people pitch deck people, you go to business incubation sessions, all kinds of things.

Everybody's proposing this Magic document that once you take it and you stand in front of the person and you say the right words and you use the right technical jargon, everybody's going to invest in your company. No, you need to have. Well, by the way, there are situations where you take this magic document, you go into a room and you present and then you get some money. Yes, that can happen. But just know that when that happens, it's a lock.

It's not because the document is magic or you are magic. You just happen to be in a room with other people and everything was aligned. That's the reason why you will notice that when that happens to you, typically it doesn't happen two or three times in a row. It might happen once, but it's not going to happen the next time or then again and then again and then after. So these are what qualification and discovery conversations or questions are about.

Who am I going to be talking to to help you figure that out? What are we going to be talking about? This opportunity, this business, this business opportunity, the business problem that we're trying to solve and what is their own take and how are they interested in it? So if you understand the investors priorities, you understand their concerns and you understand who they are, then you can tailor your presentation for maximum impact or for maximum moolah.

So this is how the process works. The list I'm about to give you is not exhaustive, so please do your own research. Go check YouTube, have conversations with other people who have raised financing before, and you'll get some good tips and tricks. That's on qualification. Talking points. Qualification Talking points. OK, Qualifications are about the person, All right, then Discovery is about the opportunity or about the problem.

So of course more can be said about that. But for now, at this stage, if you're a newbie, let's just take it that when you're having qualification Conversations, you're having conversations around the person. If you're having discovery conversations, you're having conversations around the opportunity, around the problem, around the vision, so qualification, talking points you should be talking about, and you should be asking questions about whether these people invest in your industry, stage or sector.

So like I said, don't just go and look for billionaires. There's a billionaire who makes money by selling cement and selling selling spaghetti. It might not make sense to start talking to them about your fintech now. By the way, this is just me generalizing. If you happen to know Dangote, maybe he's your father's uncle or sorry, your father's friend or whatever. If somebody's able to hook up that meeting, by all means taking the meeting.

You might be surprised that even though he does cement and spaghetti, he's interested in fintech and he wants to diverse move into other sectors. And so yeah, he might be interested in your fintech idea. So don't just look and say, OK, this guy cement spaghetti, therefore he's not interested. The other guy Adenuga, oil and gas banking, oh, banking, fintech, he might be interested. So, but we have to have the conversation.

We're trying to limit as many assumptions as possible that we bring to the table. So do they invest in your industry, in your stage, in your sector, If you know, you know for sure you've had conversations with them or with other people who know them. Let's say Dangote's daughter was your classmate in law school. You know, every little bit helps. She might not know that much about her dad, but bottom line, just do whatever preparations that you can.

You might not have access to Dangote, but if Dangote's daughter was your classmate or you and Dangote, you go to the same mosque, maybe you know, and how far, who is his friend or you know any. You get my point. The reason why this is important is don't ask people for start up capital if they only invest in certain kinds of companies and certain kinds of stages if it is not their thing. So if someone only invest in growth stage companies, those are companies that are already,

they already have some traction, they already have some users, they already have some customers. So they now need money so that they can, you know, blow this thing, you know, grow this thing. If if the people only drop money in growth stage companies, then stop asking them for money for your fintech startup. There's some people who don't drop money in startups. There's some people who say startup. No, no, no. You guys are not serious.

You will take my money. You blow it on cars and offices. At the end of the day, you tell me that you need more money for this, more money for that startup. You guys aren't serious. There's some people who only who's who prefer that to only talk to people who oh, OK, you started. OK, good. You started production. OK, good. You sold 5000 units. Fantastic. So what you need my money for is you now want to sell 700,000 units, 800,000 units.

That's why you're asking me for money. OK, no problem. Let's have the conversation. So there's some people only do that then have conversations around the investment size that they like dropping money for. So avoid wasting time if you know the money doesn't quite fit the if you know all the the numbers don't suit the all I say when I put it and English is escaping and you you get my point. If somebody likes dropping 2

million per deal and he wants a return of 10 M and something like that. But what you're looking for is you only require 500K and in return you're probably going to give them 1.5, you know then don't waste their time. They're looking for people who want big money, 2,000,010 million, and they're looking for big returns. You you're asking for 500K small money, so just keep on working. Then the decision making process, you need to know what the timeline is.

OK, we've already talked about the investment criteria, but you need to have a sense of what that timeline is if you're thinking that your business is going to blow in 10 years. But this is the kind of person who likes to get his money in two years or three years. And there's no point in having these conversations. By the way, I hope you guys can now get a sense of why you've been trying to raise funds. You've been talking to banks,

you've been talking to your rich uncle, you've been talking to Deacon and Safuguiro in church, and you've not been able to get money from her. It's because you've gone there with lots of assumptions. You've made a wonderful presentation. You didn't ask any questions, and these are some of the things that don't align. So maybe Deacon and Safuguiro likes to support young women in, you know, in starting up young women in startup space.

But maybe Deaconess Afubero, she's not a professional investor, so she will support your idea, but really, she wants her money back in like 2 years. And you're there talking about all these grand ideas about how in 20 years you're going to build a Unicorn. You know, Deaconess Afubero is not thinking about 20 years to build a Unicorn. She wants her money back in two years, three years. But she never asked. So you went there to her office,

you had the PDF, you made the wonderful presentation. She said, let me think about it, because she means well. But The thing is, she's never going to drop money because for her 20 years to build a Unicorn, Nah, that's not what she's looking. So these are why these things are important. So now, yeah, like I said, talk to people who have raised finance before. They're going to tell you so much more stuff around qualification, around the person, then discovery, talking points for discovery.

Now we're talking about the opportunity, the problem, the vision, the goal itself. So you need to look at these people in investment philosophy and what is investing motivating them to invest. Some people, once they hear social impact, you know, they will drop money, you know, want to elevate the plight of rural youth, Want to stop rural, urban migration, Want to stop deforestation in the northern part of the country?

We want to, we want to the people that are being unsettled by violence in the northeastern parts of Nigeria want to see how we can give them financial stability, blah, blah, blah. There's some people that when they hear all that jazz, they get really excited and you know, they're looking for where to throw the money. There's some people, on the other hand, who cannot be bothered about whether you're helping people in the southeastern part of the country, sorry, in the northeastern part of the country relocate themselves and gain whatever.

There's some people who just want financial returns so their own is, you know, they, they don't care. Is this thing going to stop deforestation in the northern part of the country? They are not bothered. They are honest. How much money are we making at the end of the day? So whether you know what the social impact is, they ain't bothered. You need to know who it is that you're talking to, whether somebody is leaning one way or leaning another way or both.

That way you're going to be able to highlight what it is that resonates with those people's values. For people who are cold naira and cobo, yes, you can mention that these are the social impact that we're trying to achieve. We're going to put girls in school, We're going to make sure sanitary pads are free. We're going to stop deforestation. We're going to stop rural urban migration. We're going to improve farming in the middle belt.

Yes, you can mention that quickly as a summary, but then if these are money, money people, financial people, go straight to the naira and cobo very quickly, spend time on the naira and cobo as we provide free sanitary pads to these girls. This is how we're making money as we improve farming in the middle belt part of the country. These are the resources that we expect to get, you know, blah blah, blah. So know who they are and then lean into what it is that they're interested in.

So address their key concerns. Do this proactively. You'll only be able to do this proactively if you had conversations with them beforehand. So if you've met Deaconess Beira in church and you've had a few conversations with her, or if you've met Malam Sanusi in the mosque, he had a couple of conversations with him beforehand and he kind of got a sense of where he was leaning, Then you'll be able to make an effective presentation by the time you show up to his office or to his house and you pull up the PowerPoint.

So, yeah. So that's it. Pretty much. Let's see what else I'm missing something. Yes. Another thing we need to focus on ROI. Yeah. ROI, technical term, meaning return on investment. The bottom line is you need to show how if you succeed, how they are going to get financial returns or they are going to get the desired impact. So you can say the goal is to provide free sanitary pads to 500 secondary school girls in the Northeast.

For people who are impact people, you need to show that if we can go beyond 500 and we can do 1500 sanitary pads in the Northeast, the impact is going to be this enrolment will increase, they'll be able to pass their exams more, what else? Reproductive health will increase, blah blah, blah. You need to be able to have that conversation. And then if it is about improving the plight of farmers in the middle belt part of the country or workers who have been displaced in the North Central part of Nigeria, so the northeastern part of Nigeria.

And then you also need to have that conversation. If it's money people that OK, these people, they are a source, OK. The community they've been displaced from was the farming community their source for good labour because they're all in this in this location. This is aggregated labour we can get labour for. So, so and so to produce this and this and this will lead to increase cost of goods and blah blah blah. Now, I know this sounds somehow like people are dispersed and you're having conversation about to profit from their head.

You know, I'm not saying that you should take internally displaced persons and use them as cheap labour. I'm just trying to say that some people are impact, people have the conversation, some people are money, people have that conversation. But you need to be able to tell them that what they're investing this money and this time they're investing, what is the return going to be. Now, like I said, talk to people who have raised money before.

And yes, take all the material that you find on the Internet. All the people that are promising you 5 tips to raise 1 billion naira in 2024 for your startup. The Magic Page deck. Yeah, take all those resources, as many ideas as you can get, as many workable ideas as you can get. The better. But remember, every investor is unique. If and when I become a big boy and, you know, I'm a billionaire or I'm a trillionaire, I want to come and raise money for me.

The conversation that you're going to have with me will probably be different from the conversation that you have with my wife when she becomes a big girl because she likes different things, she's into different things, she's trying to achieve other kinds of things and I'm different. So the same if you're having a conversation with Deaconess Alfubero, the conversation will probably be different from what you have with Malam Sanusi.

The conversations might be the same because Deaconess Alfubero and Malam Sanusi. Actually might be interested in same sort of thing, but you know you'll never know. We need. That's why we need to do this research beforehand. So the bottom line is every investor is unique. So we need to be able to do some research and ask some questions, engage some conversations beforehand and get some data. You know how you fintech start up people can be everything.

Data, data, data. This is data as well. It's just qualitative data. It is not quantitative. It is not 2 + 2 + 2 + 2 so so you can get all the data you need. Data that you need to tailor your pitch uniquely to the person in front of you. So if you understand people's perspectives, if you understand their priorities, if you understand what they're aiming for, then you're going to be able to position yourself for a successful funding conversation.

And that is why this is the secret back source of what you need to raise funding for your business this year. But please, by all means, if somebody says this is the Magic pitch deck, yeah, take the Magic pitch deck and look at it. Look at it with the overall framework that we've discussed over here, have conversation with a couple of people and then tailor it. Because there is no Magic pitch deck that is going to save your business.

None. It might work one or two times. It's not going to work all the time. And these are the reasons why the Magic Pitch Deck might fail. So please connect with me on LinkedIn. My name is Tavishima Ayede. I'm the host of the show. Don't worry about the spelling of my name. If you just check the link we're listening to this episode, you'll see the full spelling of my name there and my e-mail address. Then what else? Yeah, connect with me on WhatsApp as well.

The number is 08064662140. The country code is +234. For those of you who are hitting me up outside the shores of Nigeria, I'd love to connect with you guys. I'd love to hear from you. Thank you very much for your time and attention. I'll catch you guys at the next episode.