Early Bot gets the Share

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Recently, I went to pitch a few investors about my new startup, a stealth robotic venture. I was pumped. We have a dream team, a large market opportunity, and are tackling a problem that is tailor made for my background and skill set. 

We start pitching. I launch into a brief overview of my work history, confident in the story since my first startup, Neato Robotics , is a great achievement from both a technical and sales perspective. The pitches went well and we closed a round of funding quickly, but I discovered something odd—whenever I mentioned Neato, blank looks would stare back at me from around the meeting table.

Seriously? You don’t know…? Neato Robotics is the number two player in the robotic vacuum cleaning market. So why doesn’t anyone I meet ever know about it? 

Neato makes an awesome product, the Botvac, a superior product to the leading autonomous vacuum, iRobot’s Roomba (as attested to here and here and here). Neato vacs sell at Best Buy, Costco, Target, and can be found on Amazon and many other stores all over the world.  

Okay, iRobot was already a Goliath when I co-founded Neato, but I wasn’t deterred; I’d be the roboDavid to this Goliath. I was inspired by the flaws I saw in the Roomba to form a company that would develop a superior product through superior technology - a vacuum that would know where it had cleaned in a room and where it still needed to travel to complete its job - compared to the Roomba which did not contain this intelligence. iRobot was first to market, sure, but I was certain we could crush them. Our product could self navigate a room, had a bigger dustbin, could maneuver into corners and travel closely along baseboards; our product also had more suction and vacuum power than a Roomba. How could we not win over the Roomba, which just bounced around randomly and whose round shape kept it from sucking up those pesky dust bunnies in the corners of the room? Sure, iRobot had deeper pockets, an exponentially larger team and a hefty TV advertising budget, but Neato was a superior product. Shouldn’t this be enough?

Here’s what I’ve learned: Nope, it wasn’t enough. It’s actually really hard to overtake the first to market. iRobot created a perception in consumer minds that proved hard to break. Consumers tend to believe that the market leader is the superior brand. Learn from this. Get into your customer’s minds as hard and fast as you can, preferably before the competition does. And make sure you build a kick-ass technology while doing so. You’ll have a lot of extra work to do on the back end if you miss this golden opportunity. And hey, you might come in silver anyway… but silver isn’t gold.

I haven’t forgotten this lesson. My stealth robotics venture has no rivals that I can see. It will be first on the market, if I can help it.   

 

It’s the product, not the package!

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Several months ago I read a comment on twitter by a female entrepreneur about how she was beta  testing the outfits she would wear  when pitching to VCs. She was methodically working her way through a rigorous matrix of choices: Skirt? Slacks? Oxford? Dress? Did black perform better than bright colors? Which was the optimal combination?

This kind of thing makes me crazy! It makes me want to reach out through my smart phone and throttle the entrepreneur, shouting, “Forget your wardrobe! Is your idea good enough? Stop fiddling  with your outfits; focus your energies on your company!“

To date, I raised funding for four startups, including $12 million for Neato Robotics at a time when hardware was less than popular to venture capitalists. It’s a given that you shouldn’t smell bad or be dirty at a pitch (or anytime, for that matter). But smelling good isn’t going to seal the deal. Getting funding comes down to three things: team (can the VC can work with this entrepreneur and his/her team, especially if times are rough?), market (is this entrepreneur’s idea at the cusp of a large opportunity?), and fit (will this company/idea integrate with the fund’s ethos?). If you have these three ingredients, it won’t matter if you have no make-up on and are wearing jeans and a tee instead of a dress and heels--the investor will engage.

By all means wear what makes you confident. Spiff yourself up if that’s what you need to get the job done. Most importantly, be yourself, but make sure you’ve got the tools you need to properly engage those VCs interested in your ideas and vision. The VC isn’t investing in your clothes, or your appearance; they’re investing in you.