I am the author. As I remember it the pitch (for a .com company I worked for) was going ok until I said "...and if only we can get 1% of this market...". They flinched. I didn't really appreciate what I had said wrong at the time. It was only when I had more experience in marketing and running my own small company that I realized how naive this argument was.
"Whatever you do, don’t stand in front of investors and pitch them the 1% fallacy. It makes you look an idiot. I should know, because I’ve done it."
was the end, and not elaborated on... I for one would love to hear the story of how that turned out, with specifics!