When seeking investment from early-stage angels and VC’s it’s imperative that your pitch deck satisfies at least one of three categories:
A pitch deck is a brief presentation, often created using PowerPoint (highly recommended) to provide your audience a quick overview of your business. I’ve screened hundreds of decks with many pushing and sometimes exceeding 20 slides. In a perfect world you should be able to deliver a commanding presentation in around 10 slides, but still, most entrepreneurs fail to communicate a clear message about Team, Product and Traction. If you can’t cohesively string all three together, then you better execute on at least one of them. Below are my thoughts and advice on what you should consider to include when pitching an early-stage investor:
-Tell me what you do upfront
-Show evidence of credibility in first few slides
-Background information about team — previous startups you’ve launched, where you went to school, who are your advisors and why should we care
If you don’t believe your founder story is appealing enough because you are young and don’t have deep domain expertise or you’ve failed more times than you’ve succeeded, then push this information to the end of the deck. But always make sure to include founder story somewhere in the deck.
-Immediately need to know what you are doing
-What is it innovating
-Is their potential for large market growth — product/market fit
-Who are you targeting
-Market size — show ability to capture a high threshold of it
-Do you have patents or proprietary rights
If your product or service relies on partnerships, be cautious. Partnerships are hard to value because most fail. Although it is some level of credibility you have to get your product right before you solidify partnerships.
-Display traction and competitive advantage
-Evidence that business model is working — can it scale
-High levels of execution
-Make sure we know where data is coming from such as CAC (customer acquisition cost)
-Show MRR (monthly recurring revenue), customer happiness metrics (like a Yelp review) and MoM (month over month) growth
-What’s ROI (return on influence) for customer
Early-stage investors will be looking for pattern recognition, competitive landscape and other indicators of success or failure. It helps to display the ecosystem in which your startup not only survives, but thrives.
This is just a short post about what most early-stage investors are looking for in a pitch deck. I didn’t get to everything such as deal terms for one, but I’ll save that for another time. It’s rare that a startup nails all three categories. Be sure to leave a positive impression about either your Team, Product or Traction. In most cases, after all, this is your first introduction to your potential investor.