Persuading Investors: A Video-Based Study

Abstract

Persuasive communication is a function of not only content but also delivery, e.g., facial expressions, tone of voices and diction. This paper examines the persuasiveness of delivery in start-up pitches. Using machine learning (ML) algorithms to process full pitch videos, we quantify persuasion in visual, vocal, and verbal dimensions. Positive (i.e., passionate, warm) pitches increase funding probability. Yet conditional on funding, high-positivity startups underperform. Women are more heavily judged on pitch delivery when evaluating single-gender teams, but are neglected when co-pitching with men in mixed-gender teams. Using an experiment, we show that persuasion delivery works mainly through leading investors form inaccurate beliefs.

Keywords: Behavioral Economics, Persuasion, Video Data, Machine Learning

JEL Classification: D91, G41, C55, G24