12 Steps to Pitching Your Startup
As a prospective entrepreneur, the thought of pitching your startup idea to a room full of investors makes you, well, nervous.
But put that paper bag away, because there are just 12 steps (plus or minus a few, depending on your goals for the pitch) to putting together a comprehensive presentation to get your message out to the audience.
So let’s talk about your pitch deck aka your PowerPoint layout, which should explain your company, product, market position, and plans for the future.
To start…
1. Introduce your company.
What’s your company name? Product? What do you do? Consider introducing your company with a catchy “hook” to grab the audience’s attention at the very beginning of your pitch. According to entrepreneur and angel investor David S. Rose, a pitch should be exciting and “start like a rocket.”
2. Explain the problem
What problems do you see in today’s markets? Why does this problem frustrate people? For example, back in the early 2000s, the future founders of Etsy realized that crafters lacked a platform through which they could easily sell their homemade products on.
3. Bring your solution to the table
How does your company solve this problem? How does it fulfill a demand that has not yet been met? Or rather, how does it make life easier, more convenient, or enjoyable for people? In 2005, Etsy was created — an online platform that essentially allowed anyone to create a “shop” and sell their crafts, homemade products, and other goods to customers around the world.
4. Rave about your product/service
Tell me about your product/service. How do I use it? Why will customers buy/use it? If you’re pitching for Etsy, talk about how your online platform works and how an individual goes about setting up a “shop” and selling & buying goods. Don’t be afraid to show off why your product/service is so great!
5. Validate your company
How has your company been successful so far? How has it gained traction in your market? If you’re pitching for Birchbox, consider mentioning the size of your current subscriber base, size of annual sales, NYC store, etc.
6. Examine your target audience
What types of people are selling your product to? How large is your consumer base? What personal knowledge/experience do you have in this field? Continuing with the subscription box industry, Bark Box will address dog owners, Dollar Shave Club will interest men who regularly shave, and style boxes like Stitch Fix and Wear I’ve Been will appeal to women looking for personally styled clothing and accessories.
7. Survey the competition
Who are your competitors? What advantages do you have over them? In an Airbnb pitch, a presenter may mention the affordability and convenience of booking accommodation on airbnb.com versus hotels.com or craigslist.
8. Layout your business model
Go over sales, revenue, pricing, financial projections, etc. In the case of the Airbnb example, the presenter may bring up the service fee for users booking reservations as well as the one for hosts who receive reservations. Also, show the investors how your company is going to be financially successful! What are your plans for the company? What do you expect to do with investors’ funds? Present some realistic expectations for your company’s future performance (e.g. monthly/annual revenue, breakeven point, etc).
9. Introduce your team
Who else are you working with? What are their positions? What skills (financial, marketing, technical) do you and your team members possess that will help make this company a success? How are you going to exhibit effective leadership as CEO?
10. Put up that financial information
Financial statements: balance sheet, state of cash flows, profit and loss statement, cap table. I know, it’s not the most exciting part of your pitch, but this section will help investors get a better sense of your company’s financial health.
11. Address the elephant in the room
Ok, so the investors are actually considering investing in your company. At the end of the day, no matter how amazing your product is, the investors want to make money off of their investment. So what sort of return are the investors going to make? When can this return be expected?
12. Bring it home, my friend
Wrap up your pitch and tie together any loose ends to your company’s compelling story.
Because the pitch started “like a rocket,” it should end, as David S. Rose puts it, by taking the investor “to the moon.” Consider ending your presentation with a short, catchy statement to make your company more memorable to investors. If a presenter is pitching for Chegg, he/she may mention how Chegg is like a “Netflix for textbooks” in order to relate the startup to a successful company that investors already know. However you choose to conclude your pitch, make sure you leave your audience excited about both your company and product.
Overall, your pitch deck should be around 10–20 slides. These ideas can be rearranged in any order depending on how you want to speak with investors about your startup. Most pitches do not include every detail listed above, so feel free to pick and choose whichever ones will best showcase your startup and emphasize your key points!
Now practice, practice, practice, and, of course, remember to…
Show enthusiasm for your product and goals, and your company will shine through. Good luck!
Some good resources…
David S. Rose’s “How to Pitch to a VC”
Twoodo Demo Day Pitch at 2013 Startupbootcamp
Paula Zhang is a business development intern for Wear I’ve Been, a Toronto-based subscription box service launching in early 2016 that focuses on global fashion and accessories. She enjoys reading, writing, biking, traveling to different countries, and tasting the soft flesh of freshly baked sweet potatoes.
