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Pitching with too much passion? ‘More enthusiastic’ pitches turn off investors, study finds


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A new study offers entrepreneurs smart selling advice: When pitching to investors for financing, a high-octane product pitch with great enthusiasm can be a double-edged sword.

The study reveals a negative side to over-the-top product pitches. That is, displaying a high level of enthusiasm through energetic body movements and animated facial expressions may lead investors to suspect that entrepreneurs have an ulterior motive: that they are using the large hand gestures and varied voice tones as a tactic for managing impressions.

“For entrepreneurs pitching to raise funds, more enthusiasm isn’t necessarily better,” said lead author Lin Jiang, an assistant professor of entrepreneurship at the USF Muma College of Business.

Jiang and three other researchers co-authored “The More Enthusiastic, the Better? Unveiling a Negative Pathway From Entrepreneurs’ Displayed Enthusiasm to Funders’ Funding Intentions,” published online last month in Theory and Practice of Entrepreneurship

Entrepreneurs often pitch their business ideas to investors to attract crowdfunding. Jiang and her co-authors tried to answer whether showing enthusiasm during a financing pitch always helps an entrepreneur raise money for a new venture.

The research found that showing enthusiasm can make investors feel positive and make the entrepreneur look positive, but there is also a downside. An entrepreneur’s enthusiastic expressions can be counterproductive, causing investors to doubt the entrepreneur’s underlying motives.

What’s more, an investor’s negative response to an enthusiastic product pitch increases if the entrepreneur is perceived as less competent, the study found.

Researchers came to their conclusions through a sample of 1,811 participants evaluating 182 crowdfunding projects and by conducting a randomized experiment among 273 participants.

In the experiment, researchers hired an actor to present the same product pitch in two different ways: one with great enthusiasm and one without. Viewers were asked which pitch they were likely to fund.

“Our findings suggest that showing enthusiasm isn’t always effective for entrepreneurs to raise funds, especially those who don’t have the expertise needed for the venture,” Jiang said. “There are both positive and negative ways to show your enthusiasm through energetic body gestures, varied vocal pitches, or animated facial expressions.”

The co-authors of the study are USF Muma College of Business Associate Professor Dezhi Yin, Dong Liu of the Georgia Institute of Technology and Richard Johnson of the University of Missouri.

Do you want more investors for your startup? Rather make a passionate pitch

More information:
Lin Jiang et al, The more enthusiastic the better? Revealing a negative path from the displayed enthusiasm of entrepreneurs to the financing intentions of the financiers, Theory and Practice of Entrepreneurship (2022). DOI: 10.1177/10422587221076391

Provided by the University of South Florida

Quote: Pitching with too much passion? ‘More enthusiastic’ pitches deter investors, study finds (2022, June 28) retrieved June 28, 2022 from https://phys.org/news/2022-06-pitching-passion-enthusiastic-pitches-investors.html

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