Raising money from investors (especially in today’s economy) is no easy task. It can be incredibly challenging and exhausting to go from one meeting to the next only to be told ‘no’ repeatedly. While the most important part of fundraising is ensuring your company metrics and company story are at their best, having a strong pitch deck is essential.
Here are the must-follow tips for any entrepreneur pulling together a pitch deck.
1. Make your story clear
This may seem obvious but it’s hard for many founders to get out of the weeds when talking about their product. Take a hard look at your narrative and make sure it’s understandable to anyone who is completely uninvolved in your business. Pull in outsiders to get their unfiltered perspective and take close note of the language they use when talking about your product and company.
Here is the narrative I typically propose founders I speak to in their pitch deck:
• What’s the problem? This has been covered over and over again by many folks on the internet, but make sure to explain the customer pain point that you’re solving. Don’t jump straight into market sizing before outlining what is broken.
• What’s the opportunity? This means digging into the actual market size – and not just “it’s a trillion-dollar market, and if we capture 1% of it, we’ll be huge.” Your pitch needs to explain how many people have the pain you initially identified, not the dollar size of a market that Forrester projects.
• Can you demo? Show the product, plain and simple. Products tell better stories than pitch decks.
• How are you entering the market? Very few entrepreneurs talk through specific plans on how to get to different customer milestones, i.e. how we get customer 1, customers 1-10, 10-1,000, 1,000-100,000, etc. In my experience, smart investors want to see the specifics on how you acquire customers at different stages versus looking at a slide with a bunch of generic marketing channels, such as “Facebook ads, viral product loops, partnerships, etc.”
• What’s your competitive advantage? What do you have that no one else has? Team? Proprietary process or technology? This is a really hard question to answer when the truth is that you likely have a first time team and no real tech advantage – you just have the right hustle, vision and product market fit. If this is the case, focus on your process of building the business and how resourceful you have been to date.
• Any early success? Depending on your fundraising stage, you’ll need to show varying levels of traction. There are plenty of resources online highlighting the metrics an online business should monitor closely. A16z defines 16 startup metrics in this post and is a great place to start. With a little Googling you can also determine the general metrics that similar businesses have hit at different financing stages.
• Why are you the team to do it? Assuming you didn’t speak to this above in competitive advantage, dig into your team’s background and experience, specifically highlighting relevant accomplishments per team member. How do you complement each other? Why are you working together?
• How much money do you need now and later? Where will it get you? Map out your ideal financing structure and how it ties into your overall business plan.
• Don’t forget an appendix. Here you can go into deeper detail around many other questions, such as what the money will be used for, more detail into the “how” of your product or service, a more thorough market analysis, etc.
2. Brevity is key
No investor wants to read long paragraphs on each slide. Keep it short. Further, if you’re not sure whether a slide is necessary, or you don’t feel 100% confident presenting it – clean it up or kill it.
3. Numbers are clear, charts are meaningful
Your numbers should be extremely clear to the person on the receiving end of your pitch. Don’t drop in growth percentages without solid context. For instance, “we’ve grown 50% MoM” means quite a bit more when you’ve gone from 100,000 to 150,000 users versus 1 to 1.5 users. If you use charts, make sure they are easy to read and measure KPIs that matter to your bottom line growth. Investors can sniff out BS.
4. Be an expert
Make sure your numbers are completely correct. Don’t let the investor poke holes in market size, addressable market, competitive landscape, etc. That’s just research and understanding the space. Being open to feedback and questions is important, but be prepared enough so that you know more about your numbers than the investor.
5. Demonstrate progression
Speaking of charts, make sure they exhibit your growth over time, as well as your ability to establish and meet or exceed goals.
6. Keep it simple
Investors will care much more about your value prop and numbers than they will about your photoshop and design skills. That can be distracting, too.
7. Don’t waste time with an exit strategy slide
Most likely, your exit will come up in conversation. Showing that you’re completely focused on how to build the business will build confidence in the investor that you’re committed rather than already looking to jump ship.
8. Read up
There are tons of resources out there to benchmark your slides against the pros. Here are just a few of my favs:
Chase Garbarino is co-founder and CEO at VentureApp, a platform for fast-growing ventures focused on building a marketplace to help startups procure their business services, saving them time, resources, and money, at scale.