Fundraising is tough. It’s a full-time job in itself and requires months of work. The entire process typically takes four to six months, and it all starts with the pitch deck. Throughout the process, you’ll be speaking to many different people and gaining new perspectives about the business. To get to the meaningful conversations, though, you need to align investors with your company's precise, clear vision. That’s where your pitch deck comes in.
Unfortunately, the process of raising funds for an early-stage startup isn’t entirely clear. Without knowing the best practices, your pitch deck won’t effectively advertise your business, align investors with your vision, and ultimately get them excited about what you’re building. Fortunately, through the fundraising process for our company, we’ve been lucky to have amazing guidance from seasoned entrepreneurs and our current VC investors. We’ve learned a lot, and I’m outlining some of the most common mistakes to watch out for — avoiding these mistakes will increase your likelihood of creating a captivating presentation that will get you in front of VCs.
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Mistake 1: Making the Presentation First
The first mistake, if it happens, happens the moment you start building out your presentation. Often, it is made with the best intentions. Founders might look for a pitch deck structure online and use that as an outline for their own. From there, they fill in the blanks (e.g., the problem slide, the solution slide, the competition, the go-to-market strategy, projections, etc.). Founders do this because they want to make sure that they hit on the main points that an investor would want to learn about.
Without a cohesive, well-thought story and unifying message, that type of presentation risks becoming fragmented, confusing, and hard to communicate.
Fixing This Mistake
Instead of taking a template and filling it out, clarify the story first. We spent time writing down the actual story at our company. This is different than writing a formal paper. Write down, word for word, what you say because the story needs to sound natural. Natural is important for two reasons: first, it is genuine; second, it is understandable to listeners.
Next, read over what you just wrote down and start editing it because the first version of anything is never good enough. Once you get the written story to a point where you, cofounders, advisors, and/or people you pitch it to are impressed, you can start generating the presentation's key message. To build a presentation, the key message should be apparent in every slide.
Our key message was that we are building a digital rights management solution for patient data to help hospitals track, trace, and control the use of patient data. Every slide we built focused on that message and made the story more believable. For example, on the team slide, we talk about why our team is the team that can build this out.
No, it doesn’t mean you should put your key message on every slide. Instead, you should ask yourself what aspects enhance the key message and what distracts when reviewing each slide. Remove the distractions. If those distractions are something you want to get across, an alternative to putting them in the slide and potentially confusing your audience is to include it in your narrative when you walk them through it. That being said, in general, you should avoid distractions. The best way to identify distractions is to rehearse with others and get feedback on what didn’t seem to make sense.
Mistake #2: Not Scrutinizing Everything That Goes On the Slide
Startups move fast, and founders juggling multiple problems at once. Despite that, the pitch deck should not have any mistakes. It is a tool to tell the story and a reflection on the founders and their work ethic. Whether it’s about beating out competitors, delivering customer service, or building out the best product, every little detail should matter. A founder that doesn’t believe this might be a founder that VCs aren’t interested in backing with other people’s money. That being said, the level of detail depends entirely on the person viewing it, so it’s subjective; that being said, by ensuring that all of the details are addressed, even the most scrutinous of investors will be satisfied.
Fixing This Mistake
For the most part, it’s self-explanatory: go over your slides and check them. Hopefully, that flushes out some of the most common mistakes: typos and grammatical errors inconsistencies. We learned these errors when we wrote our first sentences in elementary school; please don’t bring your childhood memories onto the pitch deck. Grammatical inconsistencies might be something you’ve forgotten about after your first writing course in undergraduate, but it’s time to brush up on them and make sure they don’t appear on your pitch deck. For example, if you don’t put periods after some bullet points, but you put periods after others, you need to decide whether to put periods after bullet points.
Another area of formatting mistakes is alignment. If the objects on the slide should be on the same row, they should have the same alignment. PowerPoint makes this easy by automatically snapping shapes, images, and other objects to nearby objects. Please take advantage of it to make sure that everything is consistently aligned.
Finally, it would be best if you were using consistent formatting throughout the presentation. If you use a 24-size title, keep all your titles at size 24. Sometimes you might have a title that’s too long to fit on one line; in response, you may be tempted to shrink the size. Rather than doing that, you should reconsider how to structure the title because it’s probably too long. Furthermore, consistent formatting applies to things beyond text — if you use the color red to highlight bad things constantly, don’t use the color red to highlight good things on any slides!
Mistake #3: Not Rehearsing Together
This mistake is especially noticeable in remote presentations. In physical presentations, cofounders can pass the clickers between each other to navigate through the slides they’re respectively narrating. In the virtual world, though, passing clicking functionality isn’t as easy (although it’s doable), leading many co-presenters to repeat the phrase, “next slide, please.” That phrase (or others like it) demonstrates a lack of preparation and should actually be an opportunity to showcase your team’s cohesiveness.
Fixing This Mistake
It’s simple: rehearse together! Identify the keywords, phrases, or sentences that will indicate to the presentation controller that it’s time to move onto the next slide. More importantly than transitions, rehearsing — or even writing down what you’re saying — will allow you to identify different parts of the presentation that may need improvement from a slide or narration perspective.
Sometimes, it’s easier for people to write down what they’re going to say. Presentation isn’t everyone’s strength, and that’s okay for cofounders who might be more focused on the product/development side. When rehearsing with a written script (or notes), the presenter must practice sounding natural. The reason isn’t that it’s shameful to read off of notes; rather, it’s just hard to stay actively listening to someone who is monotonously reciting a manuscript.
The thing about making mistakes is that you don’t know which one will be the straw that breaks the camel’s back. Startup founders looking to raise capital must demonstrate, among other things, their ability to take the process seriously. Mistakes such as an inability to present a cohesive story, seeming unprepared, or even typos may impact investors’ trust. Top VCs like Andreesen Horowitz receives 3,000 inbound pitches per year. That’s more than 10 pitches per day (not including weekends). VCs aren’t worried about a shortage of good ideas; they’re trying to find the right ones.