The Biggest question staring straight in the eyes of every entrepreneur is, How to write a winning pitch deck? A pitch that can convey the potential of the startup, the potential of the founders. Everyone wants to earn that trust , which eventually helps them with funding.
What is a pitch deck?
A pitch deck is usually a 10-20 slide presentation designed to give a short summary of your company, your business plan and your startup vision. It also serves very different purposes, from trying to get a meeting with a new investor, to presenting in front of a stage, and each one of them should follow a different structure.
A demo day presentation, for example, should be very visual and contain very little text. It’s going to be seen from afar and you’re going to do all the talking. On the other hand, a pitch presentation that you’re planning to email should be completely self-explanatory. It’s going to be seen on a laptop monitor, so small font is not so bad.
In these cases it’s also very useful to track your investor’s activity on the presentation, to figure out if they actually read the 100% of the slides; this can be critical when determining the frequency for follow up emails. In our case, it was key to raising our most recent round of funding. A number of pitch deck platforms offer this as a feature.
What Do Investors Want to See in Your Pitch Deck?
To answer this question you need to understand what investors are trying to accomplish when they read or listen to your pitch deck. But before we get into that, let’s pause for a second to consider what you’re up against.
Here’s some recent data from Andreessen Horowitz (a16z), one of the hottest VC firms in Silicon Valley right now. Each year, 3,000 startups approach a16z with a “warm intro” from someone the firm knows (read Pitching Hacks for more advice on warm intros). A16z invests in 15 of those 3,000 startups. Which means they say “yes” to one in every 200 pitches, and “no” to the other 199. So the odds are against investors saying yes to your pitch. But don’t despair. Approximately 4,400 startups did get funding in 2014 so it can be done.
So what do you think investors are looking for in those one-in-200 odds-defying pitches? Here’s a clue: they are investors. So, like any investor, they are evaluating your pitch in two areas:
- Return: The potential return (aka upside) on an investment in your business
- Risk: The risks that might prevent them from getting that return on their investment
An investor’s job is to find businesses that offer the highest return on investment with the least risk. Your job is to convince them that your business offers a greater return, with less risk, than all the other businesses they are looking at.
Regarding return, remember that most investors are looking for at least a 10-20x return on their investment in a business. (And in their dreams, they are hoping you will be the next Google or Facebook or Uber and drive a 1,000x return.) So you need to convince them that you can grow your valuation at least 10-20x from its current baseline.
Setting tech bubble valuations aside, business valuations are typically driven by revenue and profit multiples, so you need to show how your product will dominate a huge market and generate the revenue and profit growth required to drive a 10-20x increase in the value of your business.
Regarding risk, understand that when investors read or listen to your pitch deck they are trying to assess your investment risk in three key areas:
- Market Risk: Are you addressing a large, growing market?
- Product Risk: Can you build a compelling product with sustainable competitive advantages?
- Execution Risk (aka Team Risk): Can your team acquire and retain new customers profitably, at scale, and transform your opportunity into a substantial long-term business?
Market failure is usually driven by a product in search of a market that doesn’t exist (“the dogs don’t like your dog food”) or is too small to be interesting to investors (i.e. there’s not enough potential revenue to generate the 10-20x return they want). Startups led by engineers can often fall into this trap.
Product failure is typically driven by a product that is not useful, not usable, or simply not competitive.
Execution failure is generally driven by some combination of inexperienced leadership, ineffective sales and marketing, and poor financial management.
Note that some initial traction (e.g. several months of accelerating customer adoption and revenue growth) can go a long way toward minimizing market, product and execution risk for many investors. It will certainly greatly increase your chances of getting funded. More on traction later.
What should be in an investor pitch deck?
A number of authors, venture capitalists, startup founders and evangelists have created different versions of what they consider required elements to successful pitching presentations. Most of them agree on the following Pitch deck outline:
- Problem
- Solution
- Product
- Market Size
- Business Model
- Underlying Magic
- Competition
- Better/Different
- Marketing Plan
- Team Slide
- Traction / Milestones
Tips On Writing A Winning Startup Pitch To Attract Investors.
1 Keep It Simple
One of the most important tips to use when writing a startup business pitch is keeping it simple. The people you are trying to approach are probably receiving a ton of similar documents on a daily basis, and yours needs to stand out. This is exactly why keeping it to the point, and descriptive will make the biggest difference.
While you do not want to make it too long, you should also not make it extremely short. Before you start to write, you need to make an outline of all the information you wish to include. After that is complete, you will be much more ready to start the writing process and put everything together in a simple and effortless way.
2 Specify Your Target Audience
Something you want to include that will help you make this easier to understand for your audience is which target audience you wish to attract. Every business has a particular type of customers they are making their products for. There are a few things these people will have in common that you should include such as their age, gender, country, and others.
All of these will help your potential investors know that you have put a lot of thought into the startup ideas. As a result, they will be more likely to support it since they will know you have planned ahead. The products or services they will be putting their money into will sell a lot easier if you have already decided who should buy them.
3 Write an indulging Brand’s Story
Talking about the reasons why you decided to start bringing this business idea to life is important to mention in your startup pitch. If you want to win the investors over, you need to show them just how passionate you are about your vision.
This might only take up a small portion of your pitch, but you should include a few bits and pieces about how it all started. Write about your vision, future goals, and ideas about the business and how you imagine it being in a year from now. Putting some emotion into your pitch will hopefully motivate your investors to make the right decision.
4 Proofreading & Editing must be taken seriously
Another thing you should not forget to do is take care of all the little spelling and grammar errors in your pitch. While these might not seem like that big of a deal, you should keep in mind that many mistakes can make your pitch look unprofessional. This can negatively impact the opinion these investors have of you and therefore choose not to support you.
You can easily find inexpensive tools online which can help you with editing and proofreading your pitch. Tools such as Grammarly, EssaySupply, and Hemmingway Editor are easy to use and can help you make your pitch look professional easily.
5 Talk About The Numbers
When it comes to convincing potential investors to contribute to bringing your vision to life, it is important that you include some numbers. What this means essentially is for you to explain where their money will go in order to turn your startup idea into a reality.
The first thing you need to mention is just how much money your startup needs to raise. Along with that, you should talk about your timetable for achieving profitability and your initial expenses. These will show your investors that you understand what you are talking about and are ready for the commitment.
6 Let The Investors Experience Your Product/Service
Last but not least, another aspect of a perfect startup pitch is offering the investors the opportunity to try your products or services. While you might need to invest some funds into making a few units, there is nothing that will convince them better.
This will make the entire experience whole and will give them a positive impression in regard to your commitment. Therefore, allowing them to try the product for themselves is crucial if you wish for your pitch to be a total success.
You were reading, how to write a winning pitch deck ?
To Register your startup, Click here for amazing discounts & offers
To View some samples of successful pitch decks, click here