The “So What” Rule

so whatI use this rule all the time when advising startups and early stage companies.  Actually, it has application in any sort of sales pitch, regardless of your company’s stage.  I call it the “So What” rule because it’s an easy way to think about it during a conversation or presentation.  It’s a fundamental element of all sorts of sales and presentation methodologies that are just called something different and with a longer explanation.  Here’s the simple approach.

Remember that investors are skeptical to start with, and rightfully so.  Most investments by angels and VC’s either fail completely or return less than what they invested.  They count on something like 1 out of 5 investments to give some minor or decent form of return and 1 out of 25 to do really well.  So many executive summaries and business plans come across their desk claiming to completely change the world that they basically get numb to superlative claims.  Same for customer prospects you’re selling to.

Because of this, every time you make a statement that you think represents a key benefit or differentiator (your product/service, your approach, your business model, etc), imagine the reader or audience member is thinking to themselves “so what!” immediately after reading/hearing it.  Make sure that you answer their “so what” concern by not just making the claim but by further substantiating it in a specific way.  For example, use phrases like “The benefit of this is …..” or “The reason this is important is ….” or “The difference between this and the rest of the market is …”.  And if you want to put a bow on your claim, finish with a supporting customer example or quote”.

Here is an example to demonstrate the point:

  • Initial claim:  “Our system includes advanced computational analytics created in collaboration with M.I.T. and published in the most recent International Journal of Analytics.”
  • “So What” enhancement:  “The is significant because due to the unique information our system provided to our pilot customers, they reduced the amount of time spent on _____ by 75% and projected an average savings of $50,000 per year for each project they used the system for.  In fact, Google’s VP of _____ told us that they were able to ______, which is something they never dreamed of before using our system.”

Use this rule when reviewing your pitch deck, sales briefing presentation, press releases, website copy, etc, etc.  Almost all of us are guilty of making shallow claims that don’t get to the “so what” information the audience really cares about.  And often times you should actually flip the narrative backwards from my example above by starting with the “punch line” conclusion.  In other words, the revised narrative above would flow something like “Our pilot customers reduced the amount of time spent on ___ by 75% and projected an average savings of $50,000 per year for each project they used the system for.  Our solution enabled this due to the advanced computational analytics ….”.  You get the idea.  Start with the benefit and then describe how you accomplished it.

The close cousin of the “So What” rule is the “Yeah, Right” rule.  Use them together for a more effective presentation or sales pitch.  Check out my other blog articles related to fundraising here.

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Author: Gordon Daugherty

Over the past 15 years Gordon has seen nearly 1,000 startup pitches, advised more than 200 entrepreneurs and been involved with raising over $45M in growth and venture capital. Throughout his 28 year career in high tech, serving twice as President and three times as CMO, Gordon has both an IPO and a $200M acquisition exit under his belt. Now his emphasis is purely focused on helping startups and early stage tech companies. Through his Shockwave Innovations advisory practice and as Managing Director for Austin’s Capital Factory startup accelerator, Gordon is an active angel investor, VC and startup advisor.

10 thoughts on “The “So What” Rule”

  1. Hello there! This post could not be written any better!
    Reading through this post reminds me of my old room mate!
    He always kept chatting about this. I will forward this post to
    him. Fairly certain he will have a good read. Thank you for
    sharing!

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