What to Include in Your Investor Pitch Deck
Last week, a Partner and I sat down with one of our portfolio companies for some good old pitch deck 'surgery'.
The founder - a resilient entrepreneur looking to raise a Series A round at a $5M pre-money valuation - spent the previous week working on a pitch deck but was having trouble distilling the complex 25 slides down into the recommended 10.
I, too, faced a similar problem as a first-time founder at Zookal. When I was buried in the day-to-day operations, it was extremely hard to give a bird's eye view without all the gory details.
This is a common struggle for new founders. In fact, "What should I include in my deck?" is the second most common question I receive from entrepreneurs. (Note: the first is "what do you look for in a startup?" which ironically brings a similarly structured answer).
Here is the 10 slide toolkit I wish I had when I was pulling my own deck together.
1. Title slide
One liner describing your business
I once saw a deck with something along the lines of "the Spotify for Twitter and Facebook's love child" - seriously? *Facepalm
2. The 'blood on the wall' problem
Lead your pitch with a pithy explanation of the problem you’re dealing with. What is the burning issue you are trying to solve? Why is it such a pain point for your consumer? Try creating a persona of your customer (particularly if it doesn't reflect the person you’re pitching to) to better illustrate your message and make it more relatable.
It might go down like this:
"Emma is an 20-year-old university student who is a chronic procrastinator and always crams the night before her exam..."
*55-year-old male investor smiles and nods as he thinks of his daughter.
2. Your solution
Here is where you dive into your product, service, platform, etc. Focus on core features and benefits and keep the actual workings of your solution (tech) fairly high level. What is your customer doing now without your solution, how do you make that process better/faster/more convenient? Avoid demo's unless it's super quick, you've tested the tech first or your product is really cool (e.g. virtual/augmented reality).
3. Market opportunity
Bill Gross, founder of startup studio IdeaLab, identified market timing as the biggest reason why startups succeed. Why is now the right time to launch your business? What opportunity are you looking to capitalise on and how big is the market you're operating in? Be specific to your niche and allude to the broader potential (textbook market in Australia is a $422M market while education as a whole is $25B. In Asia education is $4T. Insert map of the world with market size for each country/region).
Note: whatever your number, make sure you get a reputable source (e.g. IBIS world) and footnote it at the bottom of the slide.
4. Your business model
How do you actually make money? Here are a few common business models to get you started:
Subscription model (Dollar Shave Club)
Freemium with premium features (Asana)
If possible, provide a $ example on a per sale basis so we can wrap our heads around the unit economics quickly. If you're still in the early stages and haven't quite figured it out yet, select a business model that you want to move towards or that you think might work in your market. If your opportunistic with multiple revenue streams on the go, choose the business model that is directly related to your core business rather than to supplementary services. You can talk to them but don't go into too much depth or you will come across as unfocused.
Why are you and your team uniquely placed to execute your vision? Does your team have 10 years industry experience, do you have a degree/training/domain expertise, do you have a particular conviction/personal connection with the problem? If you're a solo founder or a lean team, get some advisors on board. It might look something like this for each team member:
Bachelor in Mechatronics
Logos of previous companies worked for (if prominent) or one liner ( e.g. 5 years mechatronics experience in a ASX 200 company).
6. The competitive landscape
Who are your direct and indirect competitors? A table comparing your product’s benefits or features with those of the competition, or a perceptual map format, are great ways to visualise your business in relation to the competition.
If your corner of the graph is looking a bit crowded you might want to rethink how you differentiate yourself. Also, don’t be afraid to name your competitors. The trick is to explain how you’re different. The last thing you want is your investor doing a quick google search after the meeting and concluding that you don’t know your market.
If it's location, location, location in real estate then its validation, validation, validation in startups. Demonstrate that you are filling a genuine need in the market. It's pretty standard if you're established (customers, users, revenue, engagement, etc.) however if you are still early on in the business life cycle, you can also explore surveys, customer interviews, beta trials, retention/engagement stats or if you want a sure winner, try to lock down some pre-sales or signed MOU's (memorandum of understanding) with clients.
Tip: a simple line graph is a perfect way to present your progress to date, hopefully trending upwards. Use a dotted line to indicate your forecast over coming periods. I am all for the subliminal illusion of the “hockey stick effect”, just don't overdo it with crazy forecasts.
Provide your investor with some kind of plan moving forward. I've seen lots of variations of this - financial, marketing, distribution, technology roadmap, whatever. Usually, it's tied to what you will be raising the money for.
9. Your offer
Wrap up with your offer slide. Keep it clean and simple. How much? Why? What's the valuation?
(Don't go into too much depth with the use of funds on the actual deck - a pie chart or graph is fine).
10. The appendices
In a slide deck pitch, have an appendix up your sleeve to help answer investors’ questions. They’ll be impressed that you came prepared. If they’re not needed, don’t go into them. Avoid going into too much detail about any specific aspects of your business throughout your pitch but be prepared to elaborate if asked.
Why this is by no means comprehensive, it’s a good enough template to get you started. Remember the best way to perfect your pitch is to actually go out and pitch! Even if you’re not quite ready for investment, it’s a good exercise to help you articulate high-level strategy, vision, and direction.
For your interest, here are some other articles I have contributed to on capital raising can be found below:
Business Insider: 16 Australian Entrepreneurs Share Their Tips For Securing Investment Funding
Live Q&A Tech in Asia – ‘How to raise your first venture capital round’