Do you know what the pitch deck is?
The pitch deck is a presentation that is made by entrepreneurs who put the same effort together for preparation. It is prepared especially when entrepreneurs need finance for their startups from the investors. Pitch Deck comprises well-designed slides and should not be more than 20 slides in number.
In the book, The Art of Startup Fundraising, it has been mentioned that generally, founders need two different sets of pitch decks. One set consists of a lot of data and information that is used to share with people through email. And the other version is shared with the potential investors by the entrepreneurs. It is a pitch deck that comprises more visuals. More visuals convey the message with ease that attracts the investor’s attention and this is why it is ideal to focus on creating a pitch deck with more visuals and graphical content.
Generally, there are three important keys that help in the design of powerful pitch decks that may receive funding from the investors:
- Simple and precise
- Easy to understand and act on
9 Must-Have Slides in Your Startup Presentation for Investors
The following are the essential slides you must include in your presentation deck:
- Amount being raised
Remember that research completed by presentationwork says that the investors spend 3 minutes and 44 seconds on average to judge per pitch deck. They have studied 200 pitch decks and their study says that usually, the investors spend their most of time reviewing the slides of the pitch deck which are related to competition, financial scope, and financial teams.
#1 Problem or Objective
You must cover the slide to explain your problem and how it is a way to fill the gap that currently exists in the market. The problem must be relatable to the general public and the investors must also relate to it so that they would not feel any problem understanding the issue.
Moreover, you are going to solve anyone problem, not more than two or three problems. You have to choose one bold problem that needs real focus and has to be solved as soon as possible. So, the summary is to focus on one objective in your presentation.
If you do not want to upset the investors, you must create different slides for the problems or objectives and the solutions of the problems. Do not put the problems and the solutions in a single slide.
Remember that if the investors are getting involved with your venture, it is because of the following factors:
- The investors might have experienced the same problem in the past
- The investors have got a clear idea of the Return of investment from the entrepreneurs.
- The investors might be the professional expertise and they can understand the content very well related to their profession. For example, a doctor understands the stuff related to health care very well.
If an investor has the know-how in the above all the three mentioned points at the same time, it means that you have got a potential investor. This will result in attaining the attention of the specific investor and you may expect to receive at least 20% of the financing of the total amount you want to raise for achieving your goal.
#2 Proposed Solution
The solution must be short and very clear. For instance, if you are going to have a tech startup, your solution must be scalable. Scalability is the ability of a system that helps boost its total output when certain resources are added to the system under an increased load. This is what the investors actually want to see. The investors investing in the company must be increasing its output faster. That will help them recover their capital faster than they intend to spend on your project. You need to provide a clear solution that takes the investor on a timeline journey stating how soon they can expect the breakeven point and how soon they will start receiving the fruits of their investment.
Furthermore, you should outline the solution at the right time. It will make sense if you are outlining it ‘why it is making sense now’ in sections of your deck. You may know that time is very precious in the business and it really matters if you are doing your job at the right time. Being on time is everything. Being too late or too early to a market can be potential causes of failure for the startups.
You do not need to give the statements like you are the only one who is doing this or you are a strong leader etc. As Mark Cuban has already put that, there are at least 100 people who have come up with that idea before you, and the other companies may be solving the problem with a different method.
#3 Scope of Market
You must make sure that investors can see the scope, potential, and volatility of the project clearly in your slides. If you are going to start in a small market, it still has impacts on the returns.
Do not forget that any sort of market which is under $1B, for an investor, might not be attractive in a hyper-growth business. This is because of the main factor that investors wait for the opportunity to invest in a business where they could get 10x return in a period of 5 to 7 years.
Institutional investors and the ultimate investors look for the companies that will transform their industry and also be able to change the way consumers interact with the market.
It would be better if you present a graph that shows the market in the past and the potential future growth so that the investors can look up the upside and they can see their potential ROI on their investment. And do not forget to give the reference or the sources used from research papers in making your presentation deck. Include reference or citation on the same slide where you are quoting its corresponding data; rather than inserting all the citations at the end of the deck.
This slide will be presenting the screenshots of the product which is in action. It will make your product more powerful if you add some words in the description for the products you have. Add the quotes of your clients talking about your products that how much they love your products, it will make your product more powerful.
The slide of traction must show the growth of the business month over month. Like the revenue and metrics etc. It is the slide where you will hopefully include the success of the investment and the investors want to see this in your pitch deck when they review the pitch deck. But having such kinds of promises with the investors is not easy for startups.
If the growth is not that good or it is a very early stage, you should avoid including this part. To your knowledge, Accelerator programs like Y combiner can expect at least 15% growth monthly.
#6 Team Behind the Project
Business or project team has a very important role in a startup. This is the most important part of your pitch deck. Investors want to know who is initiating the business and what makes them so different to execute their mission and vision. Remember that at least 100 other people have thought about the idea you have. So this is the reason that idea contributes 10% and you get 90% through execution.
If you have the right people as your clients so your company will find its direction to success. When you are investing in a first-time founder then you are investing in that founder’s education too. Startup team members may commit mistakes during the early days and you would be investing in them too. It is a part of the whole journey and there is no way to leave it.
The team slide in the presentation deck will include describing the members of the cofounders and the leadership team. Mention two or three achievements of every individual member in bullet points. And those achievements would be related to the company generating capital. It is a good idea to include the team’s educational background and experience-related data in startup presentation decks as well.
#7 Competition in Market
In this slide, you have to show your potential competitors. Using a diagram is a good idea to describe your competitors to the investors that you are executing well in your space. It really matters how you compare to them and where do you stand in comparison with your competitors.
You definitely want to clear out that how you are unique from the rest of your competitors so that the one who is reviewing your pitch deck will easily understand what makes your company so different.
You also want to include in a slide that would explain how much amount of capital each competitor has raised in the previous days and at what valuation. This would give an idea of how much the market is paying to the investors. It will also help you play part in your favor. You will use it when you will be going to negotiate the terms of a deal or continuing a potential investment.
#8 Financial Numbers
You may want to shoot for at least three years of projections and there are some institutional investors who want to extend the projections for 5 years but these investors are the least complicated investors.
Projections play as a shot in the dark when you as an entrepreneur, deal with startups. They will give you a good idea of where your business is going and what are its potential outcomes. Projections are also a great source to give an idea to the investors that how they can have well-balanced management in the company.
The slide of financials is a more important slide in the pitch deck than the entrepreneurs usually think. When you will be connecting with the institutional investors, they will ask to review your pitch deck. After 3 months of reviewing your pitch deck, they will call you for the next meeting where they will present their decision. You have to keep it in mind and you need to be more on the conservative angle and ready to overdeliver. Nothing can be worse than that if you are completely out of the mark and you are under promise.
In addition, your financials must be in an Excel format. So you have to prepare it in Excel as investors want to see this when reviewing the pitch deck. This is the reason, you do not have to add much detail to the deck. You just have to give a summary of the financial numbers in the presentation slide and with that, you need supporting excel data.
#9 Amount being raised
In this investment ask slide you are going to add the strategic part. You do not have to put a specific amount that you are raising. Let us assume, you want to raise $5 million, you should include the amount range between 3$ million and 5$ million. Most of the firms have a certain limitation on their investments that means that if you are going to place $5 million in your pitch deck and the firm has a mandate to not invest more than 3$ million, so you will not mention the whole 5$ million. So it is a good idea to include the range between 3$ million to 5$ million. This way, you will include such firms raising the amount. Thus you have to be very attractive to achieve many targets. So use ranges rather than using exact amounts.
You need to include your contact information in the pitch deck but most of the founders forget to add their contact information. In addition, if you have a pretty good following on social media, you can also include the links of your accounts on the cover slide. It would be social proof for the public to trust you. Interested investors will look you up and they will also contact people to ask for references.
If you really want to know the quality standard of your pitch deck, it is not bad to ask someone about giving a look at your pitch deck; who has a better understanding of sales psychology. If your images are adjusted for further improvements, their placement, and the words you use, this all could make a billion-dollar difference in your pitch deck.