While we sometimes struggle to hold an investor’s attention for what might be multi-million dollar opportunities, comedians can captivate an audience with simple jokes and observations.

Their secret? Addressing the elephant in the room.

A lot of times, the first thing a comedian does on stage is acknowledge their appearance or mannerisms—essentially, making fun of themselves. “My mom bought me this shirt….”

Here’s the harsh truth: audiences instantly notice everything that we might be insecure about. The best thing to do is to acknowledge those things before they do. If you force investors to bring up the elephant in the room (your negative cash flow, for example), you lose.

It’s hard. Those are the exact things we want to hide. How do you overcome that?

Comedians have an advantage we typically don’t: massive experience testing their material across the country. They keep what resonates with audiences and discard what doesn’t.

Most eventually find out (the hard way) that addressing the elephant in the room puts everyone at ease and actually earns their attention and support.

Applying this to Investor Pitches

We worked with a client who had exceptional backgrounds founding some of the biggest social media companies in the world. Now, they were pitching a new social media company.

However, they were losing a ton of money. It’s a common issue for these companies (even the successful ones). But the problem was only briefly mentioned at the end of the pitch. This could make investors skeptical, as the problem seems to be intentionally concealed.

They needed to learn from the comedians.

Move the financial issues earlier in the pitch and state them openly. Be frank, address the elephant in the room! Once it’s out there, lay out a reasonable plan to overcome the cash leakage. Frame it realistically. Lean into the fact that you’ve done this before and these types of companies often lose money in the beginning. Knowing this, you hired key positions to help fix the issue while simultaneously building out platform features that reflect what’s lacking in the market.

By discussing it openly and presenting a clear plan to address the issues, the clients could build more trust with investors than if they had managed to hide it entirely. It becomes less of the focal point of a pitch, and more support that you’ve done your homework and have a clear plan forward.

The Challenge of Confronting Weaknesses

Most people (especially high performers) naturally avoid highlighting their flaws, especially in high-stakes situations like investor pitches.

These same high performers are often shocked that the part of the pitch they thought was terrible was actually the moment the investor “leaned in.”

If they wanted to get investment outside of their inner circle, they had to learn to discuss the elephant in the room without embellishment, laying out the facts plainly. Any attempt to cover up issues is always perceived as a red flag. When they talk earnestly about their challenges and their plans to overcome them, investors are more likely to engage and ultimately invest.

Then, they can highlight all their wins and the investor will be “at ease” enough to actually hear them.

It can be surprising to find what was originally perceived as the greatest weakness can actually be turned into a compelling part of the story.