Score startup investment with the perfect pitch deck
No matter how hard you work or how much you grind you’re going to need a chunk of cash to get that startup flywheel turning. Generating that initial inertia takes energy and fuel… you’ve brought the energy, but what about the fuel?!
Maybe you’ve seeded your startup with some savings, it’s spluttered into life and now you’re ready to really push the throttle…(had enough of the engine analogies yet?!)
Anyway, my point is…if you’re going to grow, you need cash. Inventory, staff, marketing, the list is never-ending. Even if you are running a very lean and tight operation at some point it makes sense to consider if bringing on external investment is the right thing for you.
So, once you’ve made that decision how the heck do you stand out from the crowd and put together the best pitch deck ever?
A pitch deck that gets investors bare-knuckle boxing with each other for a chance to invest in your startup?
Your biggest mistake
The biggest trap I see founders falling into is making the pitch deck so…long…it…sends…everyone…too…sleep.
Don’t be that person.
Investors are humans too (mostly) and have a limited attention span. Think how many decks they are looking at in a week, probably dozens. They simply don’t have the mental capacity to sit and look at every single detail and nuance about your business. Even if they wanted to!
Think of your pitch deck like a lure, your main goal is to attract attention. Curiosity and intrigue. Details don’t matter here, this is step one.
“I wish that deck had more information in” said no investor ever!
What’s your purpose
“To make money” Sorry, that won’t cut it… Anyone focused on that as a goal is going to be rejected. Making money should be a by-product of solving a big problem in your sector.
Your first slide is important, no pressure here, but this almost creates the lens through which your investor will view the rest of the presentation.
What’s the purpose of your startup?
Why are you starting this business?
Take time to think and come up with a sentence that encapsulates the purpose of your business.
Remember – This is the only time you have 100% attention from the investors. This slide needs to ‘sell’ the next few slides.
The problem and your solution
Now you have the attention, you have a short window of time to outline the problem you are solving and how you intend to solve it. Use visuals and graphics to illustrate what you are doing.
Don’t load the screen with reams of dull text, use bullets, infographics and images to add some depth and richness to the pitch.
Tell a story. Stories create emotion and bring people into your world for just a moment. How did this problem affect you? What made you come up with the solution?
Target market, market share and timing
You need to start to think like an investor to get investment. Cliche? Perhaps… but oh so true.
Imagine yourself sitting there with £100k of your hard-earned money burning a hole in your pocket. What would you want to see? What would spark your curiosity?
Why is the market ready for your solution right now? What trends are in place that you are leveraging on? You need to prove that your timing is spot on. Startup failure often occurs when the timing isn’t quite right. Too soon or too late can be the death blow to even the very best businesses.
Then there’s market share… don’t fall into the trap of saying “Oh if I can get just 4% of the food market I’ll make £5 trillion” trust me they’ve heard it all before and won’t be impressed. (Unless you happen to be Elon Musk…)
Be specific, what’s your target market, how big is it and why will you be positioned to grab your share?
Why are you different? What would customers choose your solution over a competitor? Why would they choose your solution over doing nothing or keeping the status quo? (often your biggest competition)
Sometimes the competition is obvious: “We make organic skin cream and our competitors are [list all competitors]”
Other times they are not so obvious: “We have a roofers estimation app, and our biggest competitor is pieces of paper…ie the status quo”
What’s your business model and how will you acquire customers?
Remember, keep it simple… What’s your model? IE how will you make money? Is it a simple one-off transaction or will you be ad-based? Perhaps you’ll offer subscriptions?
Take a bit of time to explain why you have chosen that model and why you believe it’s the best approach.
Then comes the juicy part… assuming you’ve still got their attention this is when all investors lean forward a bit. They know the best idea is nothing without a credible marketing and sales strategy.
Be optimistic, yet realistic. Be innovative, yet pragmatic.
Show how you will acquire customers. What channels you’ll use, how you’ll target your perfect audience and most importantly what you expect the cost to acquire a customer will be. (CAC)
Again, I always suggest keeping things simple. But simple should mean a succinct summary of the huge research you’ve already done before the presentation.
TIP: Don’t just say 'Google ads' … please!!
Investors love love love teams! It’s the one thing above the idea that makes them want to invest.
You are more likely to get investment if they like you and your team but aren’t lukewarm on the idea Vs Loving your idea but not gelling with you or your team.
Alright, so what does that mean for you and your pitch deck?
What’s your experience? Why are you guys THE dream team?
Share experience, skills, attributes and qualities that make you a perfect fit to steer this startup ship through the choppy waters to unicorn cove…
If your team is not yet complete, that’s fine. Just be honest and clear, no one expects you to have everything in place.
Valuation and exit
We’ve all seen Dragons Den – “That valuation is crazy, you are mad, bring in the straight jacket” blah blah blah….
Valuation at this stage is a bit subjective let’s be honest, but if you do your research and base your valuation on logic and evidence then you can explain why you have come up with that number and back up your reasoning.
£1 million because Bob at the pub reckons that’s what it’s worth = NO
£1 million because you’ve seen other similar companies sell for that multiple, and you’ve worked at a similar business before that attracted investment = YES!
If you’ve still got their attention great! Now the part that can seal the deal.
Where’s the exit for the investor? The company might be your baby but to them, it’s a numbers game. They want to put X in and get 50X out. With that in mind, consider a viable exit strategy for your investor.
That could be:
- A next stage investor
- A trade sale
- An IPO
As before don’t forget to show evidence to back up your thinking.
- Be prepared, if you are making bold claims, have some evidence to back up those claims. Investors are going to question and probe.
- Bring your letters of intent, your marketing tests, your MVP, anything and everything. It shows you are prepared, thorough and serious about this.
- Remember to be clear on how much you are asking for and importantly what you intend to do with that money.
(The last thing investors want is to throw money at a founder who has no idea what they are going to do with it!)
- Plan a roadmap, where will the money be used and why? How will that cash help drive the business forward?Paint a picture, help the investors imagine how your business will look years down the line.
Hopefully, that gives you some ideas on how to position that pitch deck to secure the investment you need.
If you put yourself in the investor’s shoes, be open, honest and keep things simple, you’re got a great chance of securing that deal.