New Venture Lab: Equipping Christian Entrepreneurs

Question

What is an "elevator pitch" and what do I need one for?

Answer

An "elevator pitch" is the short 1 - 2 minute description you would give someone of your company or your value proposition as a succinct overview.  So named after the situation where you get on an elevator with an investor prospect and they turn to you and say "so what do you do?" and you have only two to three "floors" to go before making your case.  Elevator pitches are usually developed for prospective customers and potential investors. 

An example investor elevator pitch would be as follows: 

ABC is a property management firm that manages community associations, the fastest growing single-family housing format in the U.S.  The community association management industry is a highly fragmented $1 billion industry of 2,200 "Mom and Pop" community association management companies that manage all of the financial and operational affairs of their client communities.  The industry collects $20 billion in assessments from the 22 million homeowners that live in the existing 275,000 community associations and the industry is actively adding 15,000 communities and 2 million homeowner units each year.  ABC is creating value through consolidation (mergers and acquisitions), additional community services, scale economics, business process redesign, best practices, sophisticated technology, and marketing services directly to their captive community association homeowners who spend a total of $215 billion on home services.  The ABC strategy is to position itself as the premier management firm with a value proposition of offering a higher level of service at the prevailing market price, while producing higher than average margins through a lower-cost, highly-automated services delivery.  ABC expects revenues of $5 million in its first full year of business operation and with a capital infusion of only $10 million, expects to grow to $100 million in revenue within ten years prior to facilitating a 10X return for its investors.