By Fernando Berrocal
In resume, you should already know what investors look for when deciding whether or not to invest in your startup these are the main topics: a clear description of the problem you're trying to solve, the size of your market, the possible rivals you will have, the different growth models, and your team's capacity to carry it off.
However, you should know how to pack all of this information into a pitch deck? How can you condense what you've spent endless hours debating into a few concise slides? Consider your pitch deck a “business card”, a convincing demonstration that you're planning something huge. A solid deck can help you secure a coveted meeting with the appropriate investor even before you make the proper investment.
Every year, a typical VC or angel investor may review hundreds of pitch decks. They may read it for two to five minutes before determining whether or not to meet with a founder. While a great pitch deck won't get you a term sheet, you should know what goes into the greatest of them, what's important and what's not, and how to successfully convey your idea. The following tips can assist you.
Create An Engrossing Story: While there is no one-size-fits-all approach to telling a tale, the majority of successful ones do it straight away. In the same way, your pitch deck should begin with something relatable about why you're excited about the opportunity, or why others should be. Not every entrepreneur will be able to start with such compelling content. Take the time, though, to condense the core and effect of what you're suggesting into a concise statement. As you get through the first slide, consider how to keep your narrative brief. Your deck should ideally have between 10 and 25 slides, with each one adding to the story of the incredible opportunity you're giving.
Be Able To Describe What You're Selling: Of course, explaining what you do is essential to your deck. While this is self-evident, it's astonishing how many entrepreneurs struggle with it. Airbnb, for example, made it clear what it did in the opening slides of its widely referenced presentation deck. The first slide stated, “Book accommodations with locals rather than hotels.” The reader understood why the notion made sense by the third slide. “Saving money, earning money, and sharing culture.” What applies to the beginning also applies to the rest of the story. To put it another way, make things simple. Don't overcrowd your slides. Don't pack too much text into them.
Don't Tell, Show: Of all, nothing boosts investor confidence like being able to observe what your product accomplishes in action. Good slides, on the other hand, may occasionally capture the core of what a product does or looks like. Similarly, on slide five of Facebook's pitch deck, a graphic of a profile page, the key part of the social network's experience at the time, demonstrated the essence of the product. The accompanying language underlined the key elements: photo, contact information, personal information, and course information (since Facebook began at colleges).
Describe Your Market As Accurately As Possible: Every creator loves to brag about how they're working on a multibillion-dollar opportunity. That's fantastic if that's what you're doing. However, you must be able to explain why to investors. Generalizations and exaggerated potential risks give the perception that the entrepreneur is incompetent. Poler, who has invested in companies such as AdMob and Change.org, says he's encountered healthcare innovators who tell him, "Look, healthcare is a trillion-dollar business," according to him. “‘Yes, but you're having knee replacement surgery.' That isn't a trillion-dollar enterprise.' Investors want to know that you've put a lot of effort into understanding the potential, regardless of how huge it is.
Don't pretend to be an expert on everything. A great deck does not assume that you are correct and everyone else is incorrect. You must be open and honest about your product's capabilities as well as the obstacles it will confront. Also, don't attempt to ignore the fact that your rivals are doing certain things correctly. Famous investor and LinkedIn founder Reid Hoffman suggest pitching by comparison when explaining what makes your company unique. He dubbed LinkedIn a "professional people search 2.0" in the same way that eBay was "goods listings 2.0" (replacing newspaper ads) and PayPal was "online payments 2.0." (replacing bank payments).
Demonstrate That You Are The Proper Founder And Staff: You must persuade investors that you have the proper team in place to carry out your goal. This entails emphasizing professional credentials and accomplishments. But that might not be enough. The team slide for the LinkedIn pitch, for example, displayed an outstanding bench that, in addition to significant entrepreneurial chops and technological expertise, had prior experience in the then-nascent social networking industry. In this day and age, you should also consider the diversity of your staff. When everyone on the team slides looks the same and it sends a bad signal to your potential market.
Don’t Obsess: Believe it or not, a quest for perfection, slick design, and overly high production values in a pitch deck can all be red flags. That’s not to say you shouldn’t work hard on your deck, but try to focus on substance. And if you are the obsessive type, here’s a tip. Before you send the deck, make sure to get rid of the "version n" file name first.
Finally, Know Who You're Talking To: What do you do now that you have a deck you're proud of? Determine which investors might be a good fit for you and your startup. Finding the proper target audience for your pitch is more essential than what's in the deck or how excellent it is. Areas of interest, investing theses, intended investment amount, current portfolio, and investment climate are just a few of the things you should study about potential investors. You'll also want to hear rumors about how those investors handle founders and who they are as individuals.
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