Not surprisingly, there is a difference in formality and look among entrepreneurs between the East Coast and the West Coast. In cities like San Francisco and Seattle, dress is often more casual, while on the East Coast, business attire is more formal. This was evident when more than 450 tech entrepreneurs and executives participated in Silicon Valleyâ€™s latest disruptionâ€”the Black Enterprise TechConneXt Summit.Â They flocked to the two-day conference held October 12th and the 13th at the Hyatt Regency, Santa Clara in Santa Clara, California to not only hear from tech luminariesâ€”a powerful lineup of innovators, entrepreneurs, financiers, and executivesâ€”but to connect and collaborate with the promise of creating the next big thing.
East Coast vs. West Coast was a common theme that came up during several panel discussions, especially ones focused on burgeoning tech hubs in Atlanta, Austin, and Detroit. But not in terms of rivalry. Inquiring entrepreneurial minds wanted to know, for instance, if there is a difference in how you should pitch investors based on where their business operations were located.
Black Enterprise decided to find out, from Silicon Alley to Silicon Valley, how do angel investors and venture capitalists compare? The following answers are provided by members of Young Entrepreneur Council (YEC), an invite-only organization comprised of the worldâ€™s most promising young entrepreneurs. In partnership with Citi, YEC recently launched BusinessCollective, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses.
When pitching your business or concept hereâ€™s what you need to know:
1. Be More Modest on the East Coast
Risk-averse East Coast investors prefer small but sure gains over gambles. The more grandiose your claims, the more relentlessly East Coasters work to sniff out hidden downsides. Meanwhile, West Coast VCs go for multiple high-stakes bets and don’t need your modesty; show them a twinkle of unicorn potential and your fact-based recognition of the slim odds you aim to beat.
2. Consider Both Coast and Timeline
Keep your pitch honed to both the coast you’re talking to and the time horizon. East Coast seed round? Pitch the small story about how you’re going to hit a few million in revenue in months and reach an exit point. VC in California? Pitch the biggest, baddest version of your pitch that still represents your core business.
3. Emphasize Tradition in New York
Having lived in both Silicon Valley and New York and having been able to pitch at top-notch VC firms, I found that there was much more of an emphasis on the industry opportunity, your growth rate, and the revenue you’re currently generating in The Valley. New York, at least in my experience, tends to be more focused on profitability and the traditional measures of a successful business.
4. Keep Culture in Mind
With Silicon Valley, itâ€™s important to be aware of and discuss company â€śculture,” where East Coasters are much less likely to care, and may even be suspicious of any presentation that distracts from the numbers. By culture, I mean try to craft your company as an interesting story when working with West Coasters. They still want the numbers, but a dream is important.
5. Focus on Traditional Growth Metrics on the East Coast
The majority of investors in New York and on the East Coast (Boston, Washington D.C., Philadelphia) are traditional and rely mostly upon traditional valuation metrics such as Earnings Before Interest Tax Depreciation and Amortization (EBITDA), growth profit, and/or revenue to value companies. In contrast, West Coast investors are less traditional and focus on total users and viral coefficient.
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