Objective:
- Practice pitching new concepts.
- Critique pitches for new concepts.
- Understand the importance of pitch versus idea.
- Simulate prototype development and feasibility testing.
Overview:
Rocket pitches or elevator pitches are often the first opportunity for an entrepreneur to convince potential investors that they have an idea that represents a profitable opportunity. These are often only one to five minute presentations, but they can have a significant impact on the entrepreneur’s ability to attract investors as well as other potential stakeholders. This can be particularly true in the early stages of a venture before the entrepreneur has a viable product, and he or she has to quickly convince potential stakeholders of his or her vision and the potential of the idea. Entrepreneurs often think that their idea is the most important aspect of the pitch, but studies have shown that U.S. venture capitalists consider personal characteristics such as the entrepreneur’s ability to articulate his or her venture to be critical in determining whether or not they will reject an entrepreneur’s plan.
In this exercise, students design a paper airplane that must be capable of carrying a predetermined amount of currency in the form of coins. The airplanes will compete in two categories – time that the plane can stay aloft and the distance it can travel. However, students pitch their design to their classmates (the investors) in an effort to convince them their design is the best before the contest takes place.
The exercise has worked well for illustrating the importance of a good pitch and helps students to better understand what constitutes a good pitch from an investor’s perspective.
Usage Suggestions
This exercise works with both undergraduate and graduate students. It is appropriate for new venture creation courses, entrepreneurship boot-camps, or workshops. The session is best positioned after students have identified a venture concept, project, or family or corporate initiative to pursue and are preparing for an elevator speech or rocket pitch type presentation. Technology entrepreneurship or innovation classes are also appropriate.
Activity:
Pre- Work Required by Students
Students are to be given the following instructions in the class period prior to running the exercise: “You are to design and create a new paper airplane capable of keeping one U.S. dollar of coins aloft for as long (time) as possible while simultaneously transporting the coins as far (distance) as possible. The assignment is as follows:
- You may work individually or in a group of up to four students; the only group-related implication is that your airplane design must use the same number of standard size sheets as the number of people in the group (for example, a group of four must create an airplane that uses four sheets of paper in its design).
- Your plane must be designed to transport one U.S. dollar of coinage (or other local currency). You may choose the number and denominations of coins used; your only constraint is that their total value be exactly one dollar.
- You may not simply crumple the paper into a ball, as this would constitute a projectile rather than an aerodynamically sensitive aircraft- based design.
You will be required to pitch your design to your classmates. You will have two minutes to convince your classmates that your design will perform the best. Performance on the exercise will be based on a combination of actual performance of your airplane and the number of votes your design gets from your classmates in each category (time and distance).”
Time Plan (80 minutes)
Because each team will pitch their idea, the time required for the exercise will vary with class and team size. The timing outlined here is based on a class size of 30 students and ten teams.
Step 1 0:00–0:02 (2 minutes)
Begin the exercise by explaining the voting rules to the students. Students are allowed to vote for only one team (excluding their own) in each of the two categories (distance and time). They are not required to vote for the same design in each category. It helps to provide a sheet for each of the students to record their votes, or, if your students have computers and internet access, you can use an online voting system (this will require you to set it up before the class).
Step 2 0:02–0:27 (25 minutes)
Next, have each team pitch their idea to their classmates. Teams should be strictly limited to two minutes each.
Step 3 0:27–0:32 (5 minutes)
Have the students record their votes for the design they think will perform best in each category. Remind them that they cannot vote for their own design.
Step 4 0:32–0:52 (20 minutes)
Take the class to an open area in which to conduct the actual flights. An indoor area such as a gymnasium works best, but you can run it outdoors as well (which can introduce additional uncertainty into the performance for the students). Each team gets one throw. You should have a line that they cannot cross for throwing, and you should record the time that their plane stays aloft. After the plane has landed, measure and record the distance. It helps if you assign this task to one or more of the students.
Step 5 0:52–1:00 (8 minutes)
Return to the classroom. Record the votes and the actual performance for each team on the board.
Step 6 (exercise debrief) 1:00–1:20 (20 minutes)
If time allows, you can have a short discussion about their process with regard to creating their design. This can help to illustrate how an entrepreneur can take a constraint and turn it into an opportunity. Additionally, this can highlight the importance of prototyping and learning from failure, and many of the teams that perform well often trial several different designs. Some possible questions include:
- How did they view the issue of the coins?
- Did they see it as a negative constraint? Why?
- Did they see it as an opportunity to incorporate it into the design and improve its performance?
- How did they try to differentiate their design?
- Did they try to optimize for time or distance or try both?
- Did they prototype and test designs?
Next, discuss the aspect of effective pitching. The idea here is to get them to appreciate the importance of the entrepreneur and his or her pitch to investors. Owing to the uncertainty inherent in many early- stage entrepreneurial ventures, investors will typically put more emphasis on the entrepreneur and his or her ability to “sell” the idea, as well as their confidence in the entrepreneur’s ability to execute on his or her pitch – one has to be careful not to oversell the concept.
- How did it feel to try to “sell” your classmates on your design?
- What were the biggest challenges?
- How did you decide to invest?
- How important was the way in which they presented the concept?
- Confidence?
- What was compelling about the pitch or the entrepreneur?
- Why do you think people did or did not vote for your design?
- What would you do to improve your pitch?
Wrap the discussion up with a summary of the importance of clearly articulating your idea and convincing the audience of your ability to execute on your idea.
Post- Work
Have the students read the following articles (this can be done beforehand if you prefer):
- Elsbach, K.D. 2003. How to pitch a brilliant idea. Harvard Business Review, 81(9), 117–23.
- Santinelli, A., and Brush, C. 2013. Designing and Delivering the Perfect Pitch. Wellesley, MA: Babson College Case Collection.
Teaching Tips
Students will often try to game the system (depending on how much freedom you give them). For example, they may choose to use different weights of paper or design a flying disc as opposed to a traditional airplane. You can decide how vague you want to be. If you want to have more discussion on the creative process and pushing the boundaries, then being more vague in the instructions can lead to a good discussion on how entrepreneurs try to push the rules and boundaries. Some students will feel “cheated,” but this can still provide a good learning point.
Skill Development:
Key Takeaways
- Ability to quickly and clearly articulate an idea is often more important than the idea itself.
- Investors often focus on their belief in the entrepreneur’s ability to execute on the idea rather than the idea itself – particularly under conditions of uncertainty.
- Prototyping can be an effective way to deal with an unknown environment and develop your product or service.
Resources:
Materials List
Provide students with paper for their airplanes in order to maintain a standard paper type and weight. Alternatively, you can leave this open to interpretation as a means of encouraging greater creativity among the teams. You will need a tape measure and a stopwatch for the actual competition.
The full text ‘Teaching Entrepreneurship: A Practice-Based Approach’ can be purchased here > http://www.amazon.co.uk/Teaching-Entrepreneurship-A-Practice-Based-Approach/dp/1782540695
References:
This exercise is taken from;
- Heidi M. Neck, Patricia G. Greene and Candida G. Brush, 2014. Teaching Entrepreneurship: A Practice-Based Approach (pp.131 – 135). Edition. Edward Elgar Pub.
Attribution
- Reginald A. Litz, Dell McStay, Sergio Janczak, and Carolyn Birmingham, “Kitty hawk in the classroom: A simulation exercise for facilitating creative and entrepreneurial behavior,” United States Association for Small Business and Entrepreneurship (USASBE) 2011 conference – Entrepreneurship: Changing the Present, Creating the Future, South Carolina, United States, January 2011.
Theoretical Foundations
MacMillan, I.C., Siegel, R., and Subba Narisimha, P.N. 1985. Criteria used by venture capitalists to evaluate new venture proposals. Journal of Business Venturing, 1, 119–28.
Ries, E. 2011. The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses. New York: Crown Publishing.