How to achieve perfect pitch

With years of experience in the business of science and training as a scientist as well as in business management, Cerylid Biosciences CEO Dr Jackie Fairley is well equipped to give advice on the pitch, whether it's in the elevator or at a venture capital forum.

At the recent Biotechnology 2002 conference in Sydney, Fairley pointed out the crucial elements required in 'the pitch' to a venture capitalist include:

• Introduce the company,
• Investment highlights: why should investors invest?,
• Describe the business and the business model,
• The opportunity and your competitive position,
• Understand and demonstrate your value, and
• Communicate your plans for value creation.

Melbourne-based Cerylid's mission statement is to discover drugs from naturally occurring compounds. Since Fairley came on board as CEO, the company has successfully attracted venture capital funding.

Cerylid has had two major rounds of investment. In 2000, the company received $21 million by a consortium led by Rothschild, and in 2001, $11 million mezzanine funding led by JB Were.

Fairley says that in the pitch, introducing the company must include a mission statement, the company profile and the investment history.

Next, she says, it's important to point out to investors why they should invest. For example, Cerylid has a number of cancer targets but it's important to identify the potential blockbuster drug. Highlighting the strength in the management team and the board of directors is just as vital -- in Cerylid's case, the board contains US biotechnology guru, Chris Henney.

Fairley says most of venture capitalists will not have much understanding of the science, so it's necessary to describe the business and the business model in very simple terms. Using flow diagrams can help to show how the business is integrated, with its range of portfolios. For example, Cerylid has two different platforms, genomics and screening, both of which lead to the development of new drugs.

One pitfall that some companies fall into is overestimating their true potential in the first pitch, she says. In preparing the pitch, the company's directors need to think very carefully about what is achievable. Fairley recommends doing a breakdown and analysis of the company's IP, systems and people as a useful exercise.

After the pitch, the essential tool needed to succeed is the ability to communicate effectively. Once there is a potential investor, a huge amount of open and honest negotiation is required.

Then, once the investment deal is done, the next job is to increase the value of that investment at least several times over.