Key Elements of a Pitch Deck
Investor pitch decks are a crucial tool used by entrepreneurs to help them raise capital. Although pitch decks may take a variety of forms, each pitch deck should contain certain information critical for investors looking to make an investment decision. As you build out your pitch deck, consider including the following components:
State Your Purpose
Start your pitch deck by stating the problem your company is attempting to solve in way that is easy to understand. A good elevator pitch will lay the groundwork for the rest of your presentation and convey your company’s value proposition up front.
Define the Problem and Market
Take a moment to talk about the problem you are trying to solve in more detail. This is also a good time to define the market and quantify the opportunity at stake. Investors should leave your pitch being able to understand the issue at hand and complexities involved. Additionally, they should understand the opportunity your company presents in the market.
Present Your Solution
Once you have identified the problem and market, explain to your investors the solution. Your solution. It is important to address how your solution addresses the problem you have outlined and the value your solution creates for your customers. Using anecdotes as part of your pitch will help investors connect the dots and provides real life perspective to your company.
Introduce Your Team
Sometimes the team behind an idea is as important as the idea itself. Be sure to give a brief bio of each key team member and explain their qualifications. Technical expertise and prior venture-backed exists are differentiators and their importance is difficult to overstate. Team members should include founders and co-founders, employees, contractors, advisors, and other investors. Most startup investors bet the jockey as well as the horse.
Describe Your Successes
Outline any successes your company has achieved. This can be positive press, customer growth, financial growth, milestones achieved or partnerships formed. Investors will want to see measurable success and third party validation. Traction is key. The more you can build momentum behind your company, the more likely you will receive the capital you seek.
Address Your Competition
Every business faces competition. It is important to communicate who your competitors are to investors. Describe where your company fits among the competition and your competitive advantage. Additionally, you will want to show how your solution to the problem is different and better than that of your competitors.
Identify Your Customers and How You Will Reach Them
Give an overview of your target customers and their traits and characteristics. Discuss existing customers. Have you captured the market in a niche geography or industry? Have you signed a major customer that lends credibility and viability to your company? Include your customer acquisition costs. Ensure you communicate your marketing plan, including target growth rates and the methods you will use to increase market share.
Explain Your Business Model
After you have identified the problem your company solves and the customers who need that solution, how will you convert those potential customers to paying customers? Include a discussion of how you price your product or service, disclose your margins and give an overview of financial ratios and projections. Keep it high level. You will have the opportunity to provide investors with more detail in an appendix or in additional diligence.
Fundraise With a Purpose
Now you have reached the ask. How much are you raising? How does it fit in your existing capitalization table? What will it be used for? What is your burn rate? How much runway does this capital give you? What metric or hurdle will the capital raised allow you to achieve? “Marketing”, “sales” and “working capital” are not sufficient. Be specific and demonstrate a vision for your company.
As you conclude, it is important that you are able to tie together the story you just told the investors. As a founder, you need to demonstrate a fundamental grasp on the company, its history, its current market position, and a coherent vision for the future with identifiable steps and metrics on the road to achieving your vision.
- Be prepared to go offline. Sometimes investor pitches take place in an informal setting without the use of technology. Be prepared to pitch your idea without using the crutch of your slide deck. Ensure key metrics and pieces of information are memorized by heart.
- If your product can be demonstrated, perform a demo in connection with your pitch.
- Avoid excessively wordy slides. You want your investors engaged with you, not reading your slides.
- This Forbes Article by Richard Harroch offers pitch deck examples that can provide founders a solid foundation from which to build on.
The following sources contributed to the content of this article:
The 10 Slides Every Killer Pitch Deck Needs — Ilan Mochari
Tips For Wowing Investors With A Five-Minute Slide Deck — Sunny Dhillon