The first communication tool you use to help your business raise money with a potential investor is the pitch deck, commonly referred to as a slide deck or pitch slide deck. The investor can decide whether or not to continue investigating your business possibility based on the information in your pitch deck and presentation.
Before digging any deeper, let’s understand the exact template you can use while submitting your investor pitch.
Ideal Investor Pitch Deck Template
One should always start this pitch with the title on the first slide.
- Title- Include the name of your company, your name, your position, and your contact information. The investor can read the PowerPoint; be brief and concise about what you do (for example, we sell software, we protect the environment). Simply state, “This is my business, and this is what we do,” to begin. You want investors to consider your business’s market size and potential.
- State Problem- Describe to your investors the suffering you are preventing. Getting everyone to nod and buy-in is the objective. Do not seek a solution that is seeking a problem. For example, reduce or omit references to consultancy studies that estimate the market size.
- Elaborate Solution- Describe the meaning you create when easing this suffering. Make sure your value proposition and what you market to the audience are crystal clear. An in-depth technical explanation is not appropriate in this situation. Just give the gist of your pain-relieving strategy.
- Explain your Business- Describe how you make money, including who pays you, distribution methods, and gross margins. A novel, unproven company concept is generally a frightening idea. However, if your company approach is genuinely revolutionary, describe it using examples from well-known industries.
- Marketing and Sales- Describe your customer-facing strategy and your marketing leverage points. Persuade the audience that your go-to-market plan is efficient and cost-effective.
- Competition- Give a thorough account of the market’s rivals. Better than too little is too much. Never undervalue your rivals. Customers, investors, and staff members want to know why you’re great, not how awful the competition is.
- Key Team Players- Identify the crucial members of your management team, board of directors, advisory board, and major investors. Don’t be scared to bring a team that isn’t ideal. Every startup has gaps in its team; the real test is whether you recognize these gaps and are prepared to fill them.
Tips for Investor Pitch Deck
Going overboard with pitch decks is among entrepreneurs’ most major, frequent, and financially fatal mistakes. Everything seems nearly complicated to keep succinct and to the point, even for founders who can develop virtual wizardry and plan interplanetary missions.
30 point font is the ideal size for a pitch deck. It’s also a good idea to keep with plain, simple typefaces that are simple to read. Avoid stirring up more conflict than is required. However, ensure to include all the pertinent, fascinating information about pitch decks.
Investors spend an average of fewer than 3 minutes examining an entire pitch deck, despite how crucial and lucrative pitch decks are and how much depends on them. Long under 4 minutes, this number. That duration was only 2.7 minutes on average as of 2021. Think about the implications for each of your slides as you work to make your claims.
It is a widespread belief that investors fund only 1% of pitches. However, they fail to mention how this varies significantly over the course of your startup’s existence and across several fundraising rounds. In addition, your issue description, market size, and competitive landscape slides don’t go into great detail, according to GeekWire’s study, so why should your product demo?
50% of new business owners utilize screenshots to demonstrate the improvements they hope to bring about through their operations. The dominance of product screenshots over all other media is perhaps the most unambiguous indication of the 50K foot approach. Remember that a pitch deck is just the beginning; the diligence process will likely involve a much deeper product examination, so resist the urge to educate investors on the finer points of your offering at this stage.
Investor Pitch Deck Mistakes With Solutions
You’re set to present your pitch deck to a notable investor, but you’re unsure if you have everything ready. As you have probably already heard several times, 90% of startups fail. As terrifying as it may sound, if you are unable to obtain the money required to advance your company, you may be looking at joining that 90 percent. Your pitch deck is now more critical than ever in a world where economic instability is rising.
But don’t worry; Bizgurukul carries some of the best skill-based courses to keep you updated with the latest trends. For example, it has a course named “How to Create a Fundable Pitch Deck for Startup,” which has every step or guideline you can ask for.
Having said that, let’s move to the top 5 mistakes an entrepreneur makes while pitching to an investor.
Too Much Information
According to American marketing expert Guy Kawasaki, a PowerPoint presentation should include ten slides, last no longer than twenty minutes, and use no type lower than thirty points. He follows a rule known as the 10/20/30 rule. Keep in mind that this is a presentation-specific general rule. For example, presentations for fundraising pitches typically last 4 to 7 minutes.
By adhering to this rule, you may eliminate a lot of filler from your pitch deck and highlight the most crucial information. Do not forget that the objective of this meeting is to obtain approval to proceed, not to collect the checks.
Many entrepreneurs are of the view that the more information they put in, the better chances they get with the investors. However, leading them to be disappointed every time. Investors may notice one or more of the following if a presentation has more than 10–15 slides:
- Your disregard for their time
- You’re disorganized
- You’re uneasy.
- No one can see clearly.
Having said that, you must organize your data and be prepared to respond to inquiries. Be prepared to conduct your research, but include the essential information on your slides. You can always follow up with a different document or an email if more information is required.
Making Implausible Projections
Another instance when undertaking considerable research is likely to be beneficial in the long run. Investors don’t want to see ludicrously optimistic forecasts in which you are projecting a multimillion-dollar sum over the course of three years.
Seeing multi-million dollar amounts bandied around without supporting evidence seems the most aggravating thing for an investor.
Additionally, you must consider all the variables that can ultimately have an impact on your results. For instance, it would be helpful to keep track of the observable dangers and market rivalry (both current and projected) so that you can give the investor more precise estimates.
Remember, making a statement is not much of a daunting task, but when it comes to proving it is the place when you should be held answerable.
Unclear Business Model
Presenting your business model is essential since investors invest in making money. Therefore, your pitch will fail if you don’t describe how your company will generate revenue.
Options to think about are:
- Goods sales (per item)
- Tiers and subscription models
- based on transactions (i.e., percentage of transaction)
- Licensing (i.e., of technology)
- Affiliate revenue based on advertising
- Too many models crammed in can be harmful as well. It demonstrates your indecisiveness and perhaps your attempt to try everything.
Presentations for early-stage startups typically lack this information. So don’t believe that people are just waiting to give you money because you love your answer.
As mentioned above, try to elaborate and keep it short through the ways mentioned previously in this article.
Having an air of Unprofessionalism
The following typical errors might make your deck appear amateurish or out of date:
- A poor design
- Poorly made graphics
- font sizes that vary over the pages
- Poor slide titles (remember to use the traditional tags given under Mistake #1 above)
- The slides have inconsistent header title designs.
- On the pitch deck’s lid, there was a dated message.
- Cluttered or perplexing charts
You can always add to the information in your live presentation, so try not to pack too much information or text onto each slide. Ideally, a slide should only have 3 to 5 bullet points. Venture capitalists cannot afford to spend time analyzing excessively long or wordy pitch decks because they receive thousands of pitch decks and pitches each year.
Failing to Anticipate Feedback or Questions
Investors are unlikely to listen to your pitch deck without asking questions or providing comments. Therefore, you won’t be in good standing with the possible investor if you aren’t ready to respond to their basic inquiries about your pitch deck.
In this situation, practice is essential. You should ideally practice your pitch deck in front of coworkers, classmates, friends, and family members and ask for their constructive criticism. If you can’t respond to their queries immediately, you will likely find it challenging to respond to similar inquiries under pressure in front of an investor. An investor won’t want a delayed or deferred response; they will want to see you think quickly.
If an investor asks you questions, they are likely interested in the topic. For example, the investor could ask questions about your team and management, the market opportunity, financials, key metrics, risks, the competition, how the money will be used to benefit the investor, intellectual property, and other things.
Obtaining startup funding is a significant turning point in your business path. You need a solid pitch deck to pursue venture capital or angel investors. It’s not simple to convince people to support your vision, have faith in your team, and be enthusiastic about the possibilities of the business. In addition, there are a lot of misunderstandings and traps that can undermine your efforts. While there are certain things to remember when looking forward to an ideal investor pitch deck, all these things could be easy to understand with the course of Bizgurkul.
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