Attract Biotech Investors in a Down Market: Use a Compelling Corporate Pitch - MedCity News

Biotech companies have had a strong multi-year run that has been boosted by the sector’s response to the pandemic with the development of Covid vaccines and therapies. The speed and success of these developments showed the world the importance of biotechnology and increased the flow of capital from investors. However, the past 18 months have apparently seen a reversal of that boom due to a variety of factors, not least the world reopening and dollars flowing back into sectors affected by the pandemic.

Investor enthusiasm for the biotech industry appears to have waned during this period. Macroeconomic factors – geopolitical tensions, rising inflation, interest rate hikes, continued post-Covid momentum – are naturally pulling money away from growth sectors like biotech. Sector-specific factors also played a role, including continued attention around drug pricing reform; a seemingly stricter FDA than in years past; M&A slowdown; and redirecting some investors to more private company investments. We’ve also experienced a huge increase in the number of public biotech companies – many of which are now trading for less than cash and some of which are raising the white flag.

In short, increasing competition for investor mindshare, dollars, and control has led to a significant decline in biotech valuations and investment, especially for new companies, putting additional pressure on biotechs to succinctly demonstrate a compelling value proposition.

Unfortunately, many corporate presentations fail.

One of the occupational hazards for investors is that they wade through countless offers, many of which are undifferentiated, as they search for the best new opportunities to commit their capital to. Given the sheer volume of pitches to a limited audience of investors, time is the most scarce commodity for investors, and if companies fail to attract interest early on, they completely miss the opportunity.

Before your next presentation, take a step back and ask, “How would I react to this presentation as an investor?’

  • Is the narrative consistent with the investment thesis?
  • Is competitive positioning easy to understand?
  • Is the science too complicated to understand quickly?
  • Is data being thrown away without an explanation of why it is important?
  • Is the deck leading the host down a rabbit hole to get lost in science?
  • Are the expected milestones clear?
  • Does the presentation tell a story that stands alone without a voiceover?

Ultimately, the goal is to clearly explain the investment potential in a concise and compelling way so that a broad, diverse and time-constrained audience can easily understand how the proposal meets an unmet need in the market. It shouldn’t take a PhD to understand.

It’s easy to bemoan the space or technical limitations of PowerPoint or Prezi as sources of the muddled messages and outright banality that characterize many investor presentations, but in the end, they’re just tools. The success or failure of a presentation comes down to defining a clear investment case and articulating it in a concise and compelling manner.

I have yet to see brilliant and savvy leaders struggle with crafting concise messages that appeal to investors. In my experience, many (not all) physician/scientist CEOs tend to fall back into their comfort zone, using highly scientific terminology and concepts in ways that derail the purpose of the presentation: articulating the business case in finite amount of meeting time.

Here are some good practices for successful corporate presentations:

Make sure the business case is clear and compelling up front and pay it forward
Effective pitching begins with clearly framing the opportunity in a way that makes the investment opportunity compelling. A clearly thought-out investment thesis – one that tells a clear, business-based story in an orderly fashion – is likely to attract attention. Outline the “unmet need” in a way that uniquely addresses that market challenge, as well as what the vision for the future looks like and how it will be achieved. Make sure that all statements are based on facts and that the deck flows in a logical way to get back to the investment thesis.

Science and data should support the story – they don’t actually tell the story
Many presentations rely too heavily on science and data slides without considering how the data should be used strategically to support the business case. They are either knee-deep in science without explaining it (or they think they explain it with More ▼ science) or throw out mountains of data without explaining why it matters or how it fits into the narrative of the presentation. The audience should not be left in a position to confuse and make sense of what is being tried to be conveyed.

Be specific about catalysts
Be transparent about the respective timings of the activities, the potential stages of the competition, and any assumptions that influence the thinking being presented. Even if clinical timelines are not firmly established, drive a rough stake in the ground with “expected” times.

Make the announcement impossible to skip on each slide
On a common sense level, consider the reason any kind the slide is included in a presentation. There should be no ambiguity as to why a slide is part of the deck, nor should the audience be left with unanswered questions in response to the presentation. Each slide should include a title that can easily break down the main message so that the deck can stand on its own without the benefit of a voiceover.

Don’t neglect presentation skills
Many companies focus so much on content that they forget about the importance of presentation. It is worth the investment to prioritize effective presentation skills. It requires humility, a willingness to be taught, and a commitment of time and modest resources. Physician and scientist CEOs must be especially careful not to get lost in advanced science when answering questions while managing to get back on track to meet business needs within the remaining meeting time. In the new Zoom environment, where important interpersonal dynamics and non-verbal cues are lost, honing your presentation skills is more important than ever.

Above all, put yourself in the audience’s shoes. It sounds obvious, but many people make the mistake of creating content based on what’s most important to themselves rather than their target audience. Remember what matters most to investors and cut out anything that doesn’t add value to make an investment case.

A great presentation can make or change the trajectory of a company. Make it a priority to convey your business case as effectively as possible.

Photo: andreswd, Getty Images

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