PY Chapter 5— Slide Deck: Most comprehensive explanation.
This sequence of slides below tells a story. And that story starts from Part 3 of this essay.
Essay/Deck Outline:
1. Team
2. Vision
3. Problem
4. Solution
5. Demo
6. Traction
7. Business Model
8. Differentiation
9. Market Opportunity
10. Financing + Milestones
Part 1 — Some important pre-investment questions
Please be prepared with the answers to the following questions so that we may have a better idea of your dream
- What is your traction to date?
- How do you know you have product/market fit?
- How does your product actually work?
- Why now?
To me, if you have demonstratable answers to these 3 questions, I am interested in listening more.
1. What is your company going to make? Why did you start this company? Give me timelines of things.
2. How do you know customers need what you’re making?
3. What part of your project are you going to build first?
4. How are you meeting customers?
5. How is your product different?
6. What is your distribution strategy? How will you unlock customer acquisition?
7. Six months from now, what’s going to be your biggest problem?
8. Tell us something surprising you have done.
9. What’s the biggest mistake you have made?
10. How do or will you make money? How much could you make? (We realize you can’t know precisely, but give your best estimate.)
11. Who are your competitors?
12. What are the key things about your field that outsiders don’t understand?
13. What makes new users try you?
14. Describe each founder. Please tell us in one or two sentences about the most impressive thing other than this startup that each founder has built or achieved.
15. Why isn’t someone already doing this? What’s the barrier to entry?
16. If someone funds you, which of the founders will commit to working exclusively (no school, no other jobs) on this project for the next year?
17. Do any founders have commitments in the future (e.g. finishing college, going to grad school), and if so what?
18. What is your FOUNDER MARKET FIT? How did you meet and how long have you been working together?
19. Are any of the following true? (a) You are the only founder. (b) You are a student who may return to school when the next term starts. © Half or more of your group can’t move cities. (d) One or more founders will keep their current jobs. (Answering yes doesn’t disqualify you. It’s just to remind us to check.)
20. Please tell us something surprising or amusing that one of you has discovered. (The answer need not be related to your project.)
20. Are you a (a) Designer, (b) Coder, © Developer, (d) Have experience in any specific field? If so, what?
21. What’s your non-founding team today and who will you bring onboard?
22. What is your CAC and LTV?
23. What’s your business model? What’s your unit economics? What is your fixed cost? What are the other cost elements.
24. How much capital are you raising?
25. What MILESTONES will you achieve with the money? How will you achieve these milestones?
26. What are your KPIs? How do you measure growth?
27. Which cities do you want to expand to and why?
28. What is the size of this opportunity/total addressable market?
(These questions are influenced by our knowledge of numerous articles about what people like Paul Graham may want you to tell them)
Part 2 — The decisive 25 minutes of your life
These 25 minutes of your potential investor may be very critical to you. Pay a lot of attention to this act.
Your introductory email to the investor or rather the introducer.
The busiest of investors give high regard to an introducer who they trust with his business acumen and past credibility. So it would be in the interest of your goals with this investor to find yourself a well regarded individual from the industry to introduce you to the investor.
What do I send to the introducer?
Send a brief email to the introducer that he can ‘forward’ to the investor with a small 2 line note from his side about his views. This email is your elevator pitch. Attach your slide deck with this email (or upload
Subject of the email : Introducing ‘your company name’ to ‘the investors name/company name’ for consideration of investment.
Part (A) of the email — The Elevator Pitch
This is the body of your email.
This is also referred to as an executive summary, but, it is largely called and accepted as ‘the elevator pitch’.
Read the box with green font here for a good view on what an elevator pitch looks like.
For your elevator pitch learn from these incredible articles:
1. How to describe a vision.
2. Describe your company anyhow in one sentence.
3. How to tell your startup’s story.
Part (B) of the email — The Slide Deck
This is the attachment of less than 15 minimal slides as a PDF with notes below each slide for reasoning. (So you do make a slide presentation with notes below the slides, but send it all as a PDF )
Note 1 -: Normally a presentation should be highly visual, with minimum texts and maximum simple graphics & pictures. Don’t assume your investor will understand all your technical jargon. Present your plan to him as if he were a layman.
If your introducer is credible and your elevator pitch has well summarized your startup, you will almost certainly be in a good spot for your meeting with the much-esteemed investor
“A great elevator pitch is more important than your deck and less important than the introducer. If you don’t have an introduction, the elevator pitch is critical to a cold call
An introduction sells the investor on reading the elevator pitch, which sells the investor on reading the deck, which sells the investor on taking a meeting. Many investors will just skim the deck and take a meeting if the introduction and elevator pitch are good” — Nivi, co founder Angellist, Venture Hacks.
Note 2 -: If you don’t have an introducer send the email directly to the investor, obviously. Although, I am made to believe that the very important investors seldom check emails without a credible introducer. But don’t worry, if we like what you are upto, we may become your introducer!
Part 3 — Slide deck
I am writing this blog post to help you understand the perspective with which the investors are going to assess your business plan and why you should consider assessing it the same way anyway.
“This sequence of slides below tell a story:
We have a mission and a team that is taking us there. Why? We discovered a large problem and solved it with a product that has this amazing technology inside. We’re going to market and sell it to these customers, with these advantages over our competitors. In particular, we’re working towards these milestones over the next few quarters. In conclusion, this financing is a great investment opportunity.
The product isn’t revealed until the fifth slide of this methodical sequence—that’s annoying. Fortunately, the elevator pitch/summary slide kill the suspense by summarising your company and product before an investor jumps into the deck”. — Nivi, cofounder AngelList, and Venture Hacks.
And please always keep in mind: your pitch-deck is not just a couple of slides that represent your solution but rather the visualization of your business plan.
Slide 1 — Cover
The cover slide should offer complete contact info, your logo, and a tagline if you've got it right. This should be the shortest way of projecting your business.
(You want your contact information well established right on the cover so that you can be reached well enough and very simply too)
Imagine this was the only thing that the investor was going to look at from your deck for he suffers from lack of time. So, try to capture your business in most intriguing ways through just an image and no more than 2 lines.
Slide 2 — Mission
Find one interesting picture that summarizes your mission statement and write your mission statement on it.
Bad mission statements:
“To create the world’s largest software company.” [too broad and unrealistic to practically guide decision-making]
“To develop the world’s best technology for defending DNS servers from worm attacks.” [er, you said you’ve already done that, right? Mission accomplished!]
It helps when you just sit around the table and work on defining what you do to see where you agree and disagree about what the company is all about. It helps new hires understand what the company is about. It helps when you try and pivot to decide which direction to go or more importantly which direction not to go. It helps you decide when you are successful and see new opportunities which ones to consider and which ones to ignore.
Above all, it would tell the investor where are you aspiring to take your company. What should your company be known to have done? This slide will capture your big vision. Do you plan only tackling this one market your start operating in or are your plans to operate internationally or maybe even expanding your portfolio? All of these questions should be answered here. It’s important for us to see where you want to go with your product in the long run even if you have to focus on more urgent and pressing topics in everyday work.
Slide 3 — Summary/Elevator Pitch
Summarize the key, compelling facts of the company. This slide is to make up for the delay in introducing the product and your startup’s achievements in this slide deck methodology. It gives enough reason to your investor on why they should listen to you (or not) further.
Earlier this was called the management/executive summary. Today it’s the elevator pitch — and it’s literally a pitch! Tell us in 30 seconds who you are, what you do, what problem you solve and how you do it. Nothing more, nothing less! Short, precise and to the point. Thanks.
Slide 4 — Team
The team slide features right up here as your team is going to be the single biggest factor for an investor taking a keen interest in your proposition beyond your idea (your idea has briefly been spoken about in the summary slide already).
This slide should introduce up to 5 key members of your team with Linkedin profiles of each updated and link attached.
The next 3 slides 5, 6,7 are the slides you should work on first
Slide 5 — Problem
If you had the idea to come up with your solution, there must be a problem you want to solve. Sounds simple? Well, it is. Describe why there is a concrete need in society, tech or elsewhere that calls for exactly your solution — something that has never been there. And although we know, you are super eager to show us what you got — follow the rule: First the problem, then the solution!
A good moment to tell the investor of what is the problem this incredible team is looking to solve. The problem should be presented in a way that the investors sees it as his own. There is no better validation for the problem you are looking to solve than the investor himself feeling that pain. If this is established you can be sure that you are connecting well with the investor at this point. Describe the inability of others for having solved this problem.
Your problem also indicates the size of your market and the potential usefulness of your following solution.
Slide 6 — Solution
And now the solution to remedy the above-mentioned problem.
Include a demo such as a screencast, a link to working software, or pictures. This slide should clearly indicate how your solution is solving the above-mentioned problem.
Walking the investor through a video of your working product would be a good thing to do.
Yes, please demo your product. A prototype would be nice, but it’s also okay if you don’t have one yet, to give us a visual presentation of how your solution works. Thanks.
Slide 7 — Competition
There must be competition. Please, don’t take the liberty of saying there is no competition, for the chances of that, are second to none. Also, it would reflect very badly on you if your investors find out that there are similar operators like you in your market and you have been either lying to them or have been clueless about your own market. The result of this would be that they are going to start discounting most of your words so far and thereafter for your perceived lack of knowledge of your own domain.
On this slide, it would be very important for you to compare with your competition to clearly suggest why you have the advantage of doing it better than your competition.
It will do good for you to make a comparison in a 2 by 2 matrix diagram comparing the two most important factors of your business.
You should definitely convey clearly that you are open to anticipating your remote competitor trying to do what you are doing for they have the capability and the muscle to do the same, and in all likeliness, better.
Slide 8 — USP
Listing your USP will be a part of this slide based on the conclusions of your Slide 7 where you are drawing a comparison between your product and your competitors' products.
What’s your biggest advantage in comparison to the others out there? Is it hard facts like patents, kick-ass experience, a core feature, a super strong brand or are you already the market leader? Is your technology one-of-a-kind or are you simply working twice as hard as the others? What distinguishes you from the rest, is what makes you special to us and attractive to us!
Intellectual property — Some suggestions and tips for the protection of Intellectual Property Rights in India:
Register Intellectual Property Rights (IPR);
It has been observed that a registration certificate may carry a greater value than the actual evidence of user of the IPR before courts as well as enforcement agencies;
Remember Courts put greater reliance on registrations.
Remember for protection of your trade mark / copyright, registration is not necessary.
Keep your intellectual property portfolio ( Registrations) updated;
Make Intellectual Property protection a priority;
Implement clear and effective policies and strategies for IP protection;
Must have an IP management policy for the organization;
Whenever possible, prefer to give a public notice against any violation of the IPR through at least 2 newspapers of the national level, as such publications are treated as pubic knowledge and defense of ignorance about the rights of the IP holder may not be taken in the court;
Wherever required, enter into elaborate assignments, licensing or user agreements, and care should be taken to make provisions for all post termination IPR issues;
Discourage the policy of permissive user;
While dealing with IPR, believe in writing;
Conduct regular due diligence exercise to protect and detect IP violations;
Determine the risks that your IP faces and keep a watch over potential registrations, risks and violations, and take timely action to oppose any such registrations or violations;
In case IP litigation is initiated, take the same to its logical conclusion by restraining the actual violation, however do not prolong the litigation, until and unless absolutely necessary, for damages or compensation. It has been observed that Indian courts are not very inclined towards granting punitive or exemplary damages;
Remember, delay in enforcement of IPR may some times frustrate;
Renew your IPR in time, else you may loose your substantial right in the IPR;
Plan for IPR inheritance;
Keep all papers, registration certificates, copies of applications and correspondence etc., at one place and safely.
Remember IPR is your most valuable asset.
Slide 9 — Technology / methodology
The exact unique advantage you have over others for doing what you are doing to continue to do it better than others who may be doing this or may be looking to do this.
Basically, you need to delve deeper into your unique technology or other back end elements that give you a unique advantage over anyone in the future who may be looking to do exactly this.
Slide 10— Market opportunity and Marketing Strategy
Show off early customer or distribution progress: numbers, logos, testimonials. Discuss your plan to acquire users or customers.
Getting customers to buy your solution? Sounds crazy, but…yeah, you have to do that too! You need to show us how you approach the market you’re tackling and how you position your product in it. And have you considered that this burns quite some cash? Are you aware which channels make sense for you to activate? What are your conversion rates? Covering all Social Media Channels or doing only Tele-Sales will most likely not get you to close the deal. Be clear about which efforts you have to pursue and what they will cost. Yes, we are clearly looking for your Cost of Acquisition for customers.
Of course, bigger is better and more volume is even better. But focus on a relevant market for your product and stay realistic. We want to see nice numbers, but always be sure, skyrocketing market shares and volumes happen only once in a million (hello @instagram) What part of the cake is for you and when will you get there? What does that mean translated into €’s? It might make sense to follow the top-down/bottom-up approach to validate your assumptions immediately.
Rather than speaking volumes about the size of the market, sum that up in one line, to put more focus on real user/customer case. Take one real customer and tell the investor how is he benefiting from you.
Why is now the time for you and your solution?
Slide 11 — Sales
Show your business model here. The per customer acquisition cost and what does it translate into — revenue, usage or whatever else.
Let’s not kid ourselves — in the end, it’s all about how you make money and generate revenues. Do you make money through retail stores, by charging fees for ads or by taking commissions? There are so many models, that’s why we want you to be as precise about your revenue-model as possible. Of course, we know, pivots are always possible. So having 1 or 2 different revenue plans as a backup never hurts.
Slide 12 — Milestone
Include your current status and milestones for the next 1-3 quarters for product, team, marketing, sales, and quarterly and cumulative burn. Don’t build a detailed financial model if you don’t have past earnings, a significant financial history, or insight into the issue.
Slide 13 — Conclusion
This will have 2 components -
- This slide should be inspirational like how you can conclude the spirit of your business. For e.g. 1 For Preseed I would write on this slide — Those who will be touched by us will be transformed. They won’t care about how much money they are making, all they would care about is the difference they are making and how much they are learning in the process. They would stop being in a hurry and would rather give creativity its due time. They would create only that which is worthy of their time. They would believe rather than dismiss. e.g. 2 for Todoed I will write on this slide — Todoed can make the world more productive.
- Conclusion as a business opportunity in valuation terms. e.g. Todoed can be a billion dollar product in less than 3 years for it can have millions of users for its 0 learning curve and real gap fulfillment.
Slide 14 — Financing
Dates, amounts, and sources of money raised. How much money are you raising in this round?
Yes, a complex topic to talk about, but isn’t that why you are here? Let’s talk about business. Show us what you have achieved to date. We’re happy to see first customers that act as a proof of concept or even first profits. This adds quite some credibility to you as a company and your product.
On the other hand, you want something from us, so don’t hesitate to point that out. We know why you are here. Just tell us, how much money you need, how much you have raised so far and what you will use the cash for. A rough milestone planning for the next 6–12 months with concrete use for the funds you are about to raise is the non-plus-ultra here.
Such are the slide decks we hope you send to us to partner with us at Preseed.
Part 4 — Details along the slide deck
Important supporting documents along the slide deck
- Profiles of the promoter group
(Please ensure this is on the slide deck itself. The names of the team should be linked to their profiles like linkedin, github, personal blogs etc.) - Projections in an editable excel sheet with suitable assumptions
- A 1 page write up on the Product Journey of your each 3 key competitors
- Justification of the relationship of investment to be made and x% stake offered to that investor.
(Say you want to offer only 5% to an investor for an investment of 10 laksh, then you got to justify this value, not only through your passion and imagination of how great your startup will be, but by showing numbers, market and deriving conclusions out of the data present) - What happens to the Company in case the Projections as mentioned in 2 above are achieved say only upto 50% OR 75% (what is value protection mechanism).
- What can be the key milestones that can be monitored on monthly basis to judge the direction of growth of the Company/ management effectiveness and efficiency.
- Has the promoting company got drafted ‘stake-offer’ agreement/ Shareholder Agreement from any lawyer? If yes, please share.
- A note, in lay-man’s language, about the Product life-cycle.
- A note, on the Risk Factors with respect to the PRODUCT.
Drafting these answers I see as necessary anyway to have a vision of the company and it’s check points, from all spectrum, so don’t just consider these points for the sake of investor, it is for the sake of the startup getting built by the valuable intellectual inputs from your founding team (Entity A), Preseed’s team(I and others, Entity B) and the investor community.(Entity C). You see each entity of intellects add their unique value by getting their unique concerns answered. for their unique needs. So it is best to put these 9 points into priority if you want to get the maximum value extracted out of entiy b and entity c. If there is anything in these 9 points, ask me, as soon as possible and get started with these drafts.
Remember to not shy away to answer any question(unless you want to keep it confidential from investors, which I not only discourage but also detest) about your business if it could be answered by you in 48 hours of research. Giving 48 hours away from a usual business work day would be worth it, if it could help you know about your business through the questions of others, with clarity, what you don’t already know of.
Part 5 — The sources that have influenced this blog post hugely -:
1. David Cowan’s blog post on almost the same topic.
2. A blog post on exactly this topic by Nivi on Venture Hacks. In fact, this is the post which I have taken the maximum from for drafting this.
3. A post by Brad Feld almost similar to David Cowan’s post
4. A blog post by Dave Mclure on why you should pitch the problem first.
5. http://themacro.com/articles/2016/07/how-to-pitch-your-company/ a post by Michael Seibel, a YC partner. He sums it up in 7 questions.
6. And numerous slide decks that I have gone through myself.
7. Also, watch this Ted Video by David S. Rose on Pitching to a VC and this one by Dave Mclure on ‘How to pitch to a VC’
8. LinkedIn’s pitch to Greylock
9. I strongly recommend you to read this tiny blog post by Sequoia Capital.
10. www.pitchdeckcoach.com is a useful website for learning about the art of making pitch decks.
11. Airbnb pitch deck – https://www.slideshare.net/mobile/PitchDeckCoach/airbnb-first-pitch-deck-editable
12. YC+Stripe – a guide to startup pitching –
13. How to Build Your Investor Pipeline –
14. 30 Questions Investors Ask During Fundraising –
15.
16.
You can further dig these link below for insightful examples on how some of the very successful startups created/strategized their pitch deck.
On this site (http://www.pitchenvy.com/) you will find some more useful slide decks of popular startups.
And finally to sum it all here
Please review your slide decks without personal bias. Empathize with those who you may be showing your slide deck too. Anyway, remember, the only 2 things of importance here are ‘your startup story’ and ‘your execution’!
If you want to learn about pitching in greater detail read this PDF.
And once you are done with reading all of the above, download this bible and print it out. Keep it with you at all times and keep learning about your startup as a venture poised for millions of dollars in venture money backing.
In the end, here is an example cap table with some instructions here.
Please be real or be a butt of a joke:
At some point, things will come to this point, do not forget :
Recap :
- Problem statement: What is the problem you're trying to solve? Describe your product and what it does or will do (problem and solution offered)? Please be SURE to cover your critical insight into the solution that no one else has considered or failed at implementation.
EXAMPLE :
2. Goals - What is success for this startup and what are the measurable outputs (KPIs)?
EXAMPLE :
Another examples of some goals we set while building our marketing strategy
3. Values (tenets) : What are your startup values, which enable you to make key business decisions?
EXAMPLE : Some tenets we set while building out our procurement strategy
Another example of how you can use your values as a checklist. A sample of Preseed values that can be used as a checklist for setting tenets is as below:
How we plan
- Consider all stakeholders (team members, partners, founders, investors etc.)
- Logic and data back the best ideas
- Goal thinking vs task
- Sense and evolve
- With ethics and Integrity
- Distribute everything - especially authority + wealth
How we work
- Through diligent documentation
- By being an owner, with focus and planning
- By outsourcing everything non core
- With alignment of purpose and values
- Through collaboration and with learning
- Be passionate about creating world class outcomes for your customers (Output is a muscle, flex it gloriously!!)
- Think from a first principle perspective
- Focus during meetings
- Tech is your friend, hug it out
- Self manage, do amazing
- Be conscientious towards our team and founders
- Be conscientious towards our goal
How we behave
- Relationships and conflict - be loving not warring ♥
- Be empathetic, be a teacher
- Strength in diversity, strength from security
- Curiosity is A-M-A-Z-I-N-G
- Be conscientious towards our minds
- People who reflect and learn are critical:
- We believe in second chances, but not thirds
- Be conscientious towards our body:
- Be conscientious towards our planet
- Be radically transparent
4. State of the business : Briefly share what stage the startup is at, what does the team look like along with their roles and responsibilities. Additionally, please share details about the market/industry. Do share this part deeply, as this would be a key part in our decision making process - how big the market is, what do customers think of a solution like this (if a competitor exists), industry insights, possible scale of business etc. This information will help us understand the market size and if it would make sense for us to get involved.
EXAMPLE :
5. Lessons learned : What have you learnt from the business or from the market research till now and what are your insights?
EXAMPLE :
6. priorities : Lay out the plan to achieve the goals stated.
Please cover every question mentioned below :
- What is your SMART one year goal? Additionally, please provide month-on-month milestones you will set to achieve the goal (incorporate product-market-fit within the first year). Do specify WHO would do what. (RASCI)
- How will you describe Product Market Fit (PMF) and what are the operational and financial metrics you will set to measure PMF? How much money would you require in the first tranche to achieve Product Market Fit?
- How much money would you require overall? Do share a financial model to explain the unit economics, market share, financial requirement and the critical activities of the first year. Kindly specify if you are going to/have previously contributed capital. Here is a great article to hash out financial models and here is a sample format you can use!
- What are your impact metrics (quantitative), ie, what are the metrics you will measure to understand your long term positive impact on the world?
- How are you planning to return the money?
- Any other details you want to mention
You can also check this link (strategic priorities section) here for more details!
