If you are raising money for your business, an impressive pitch deck is a key component in your fundraising toolkit. A great pitch deck gets potential investors excited about your idea and leads them into a conversation about your business, which hopefully leads to an investment.
In this article I am going to give you the formula for what to include in your own pitch deck.
I use the knowledge I have gained from listening to hundreds – if not thousands – of elevator speeches and pitch presentations. I’ve seen all kinds of pitch decks and presentation styles and found that there is a simple formula that just works.
I’ve also built my own over the years and introduced major VC firms in Silicon Valley and learned a lot about what works and what doesn’t.
While every company is different, I’ve found that the following format works for most companies and is most likely to generate interest from potential investors.
First, download our free pitch deck template and read on to get a glimpse of the importance of each slide as you develop your own deck.
Goals for your pitch deck
This may not sound like intuitive, but the goal of your pitch deck is not to raise money. What? I know this doesn’t sound right, but the real goal of your pitch deck is to get to the next meeting.
Keep in mind that your pitch deck and presentation are likely some of the first things an investor will see to learn more about your business. And since investments are rarely made after just one meeting, your goal is to generate interest in your company. They want investors to ask more after hearing your pitch, rather than just leading you to the door.
While a solid pitch deck is vital to raising money, the main goal of the deck is to get to the next step – another meeting and a request for more information.
The 11 slides to include in your pitch deck
1. Vision and Value Proposition
This is a quick, easy-to-use overview of your business and the value you bring to your customers. Keep it short and simple. A great way to think about this slide is to think of it as a short tweet. Describe your company in a maximum of 140 characters as your parents would understand it.
It’s common for technology companies to compare their value proposition to another well-known company. For example, you will see a lot of pitches that start with things like:
“We’re the Uber for Pets”
“We are the Netflix for video games”
This can work, but be sure that your comparison makes sense and that you’re not just using a high profile company like Uber to flag growth potential. Your business model needs to be really similar to the company you are referring to.
2. The problem
If you fail to solve a problem in the world, your business will have a long climb.
Use this slide to talk about the problem you are solving and who is having the problem. You can talk about the current solutions in the market, but don’t spend too much time on the competitive landscape on this slide – you can do that later.
Ideally, try to tell a relatable story as you define the problem. The more you can make the problem as real as possible, the better your investors will understand your business and your goals.
3. Target market and opportunity
Use this slide to expand on who your ideal customer is and how many there are. How big is the overall market and how do you position your company in the market? When they can find the data, investors want to know how much people or companies are currently spending in the market to get an idea of the overall market size. Here you tell the story of the scope and extent of the problem you are solving.
If it makes sense for your business, you’ll want to divide your market into segments that you target with different types of marketing and possibly different types of product offerings.
However, be careful with this slide. It is tempting to try to define your market as big as possible. Instead, investors want to see that you have a very specific and accessible market. The more specific you are, the more realistic your pitch will become.
4. The solution
Finally, you can get down to the description of your product or service. Describe how customers use your product and how it fixes the issues outlined on slide 2.
You will be tempted to get this slide closer to the beginning of your pitch deck, but try to resist the temptation. This is a classic storytelling where you build the problem and describe how bad it is for many people. Now your product or service comes to the rescue to solve this problem.
Most business owners get very focused on their product when they need to focus instead on their customers and the issues that customers are facing. Try to keep your pitch deck focused with this format and you will tell a better story.
Whenever possible, use pictures and stories when describing your solution. Showing is almost always better than telling.
5. Income model or business model
Now that you’ve described your product or service, it’s time to talk about how you can make money from it. What do you charge and who pays the bills? For some companies (e.g. content sites), advertisers pay the bills instead of the users. It is therefore important to clarify the details here.
You can also refer to the competitive landscape here and discuss how your pricing fits into the larger market. Are you a premium, high price or budget offering that undercuts existing solutions in the market?
6. Traction and Validation / Roadmap
If you’ve already had sales or early adopters using your product, talk about it here. Investors want to see that you’ve proven some aspect of your business model as it reduces risk. Hence, any evidence to confirm that your solution is suitable for solving the problem you have identified is extremely powerful.
You can also use this slide to talk about your milestones. What important goals have you achieved so far and what are the most important next steps you are planning? A product or company roadmap that outlines important milestones is helpful here.
7. Marketing and sales strategy
How do you intend to attract customers’ attention and what will your sales process look like? Use this slide to outline your marketing and sales plan. You want to detail the key tactics you will use to introduce your product to potential customers.
Finding and winning customers can sometimes be the greatest challenge for a startup. Therefore, it is important to show that you know exactly how to reach your target market and which sales channels you want to use.
If your marketing and sales process is different from your competitors, it is important to highlight it here.
Why are you and your team the right people to build and grow this company? What experiences do you have that others do not have? Highlight key team members, their accomplishments at other companies, and the key skills they bring with them.
Even if you don’t already have a full team, identify the key roles that remain and why those roles are critical to the company’s growth.
Investors expect your financial data for at least three years: sales forecast, profit and loss account (also called profit and loss account) and cash flow forecast.
However, for your pitch deck, you shouldn’t have detailed spreadsheets that are difficult to read and use in a presentation format. Limit yourself to charts that show sales, total customers, total costs, and profit.
You should be ready to discuss the underlying assumptions you made to meet your sales goals and the key cost drivers.
Remember to be realistic. Investors see “hockey stick” projections all the time and will mentally cut your projections in half. If you can explain your growth in terms of your pre-existing traction or as compared to a similar company in a related industry, it will be extremely useful.
Every business has competition in one form or another. Even if you enter an entirely new market, your prospects today are using alternative solutions to solve their problems.
Describe how you fit into the competitive landscape and how you differentiate yourself from the competitors and alternatives currently on the market. What decisive advantages do you have over the competition or is there a “secret sauce” that you have and others don’t?
The key here is to explain how you are different from the other players in the market and why customers choose you over any of the other players in the market.
11. Investment and use of funds
Finally, it’s time to actually ask about the money. That’s why you’re doing this pitch deck, isn’t it? I know – I said this pitch deck is not about actually getting funded. That’s still true, but your potential investors need to know how much money you’re looking for.
More importantly, explain why you need the amount of money you want and how you plan to use the money. Investors want to know how their money is being used and how it will help you achieve the goals you have set for your business.
If you already have some investors on board, now is the time to start talking about these other investors and why they made the decision to invest.
Other slides you might include on your pitch deck
While you want to keep your pitch deck short, there are times when you need or want to include a few extra slides to help explain your business. You probably won’t use them when you present, but this can be a great resource for investors to review after the fact.
Here are some additional slides that are often found in investor presentations.
When you are raising money from investors, you need to show them how you plan to bring them a return. You do this in the form of an exit strategy slide that describes who your potential buyers could be if you manage to grow your business and be successful. Going public and going public are a viable option for some high growth startups, while other companies are more likely to be bought by larger players in your market.
Some companies have important strategic partnerships that are critical to their success. Often times, this can take the form of an intellectual property license from a university or major distributor who is bringing your product to market. If your success depends on such partnerships, it is important to showcase them.
Demo and screenshots
If you have a prototype of your product, screenshots of your online service, or other “show and tell” opportunities, it’s great to include a placeholder slide in your deck where you can actually show your potential investors how your product works and what it is doing .
It is important that you keep your pitch deck as short and concise as possible. Remember, your goal is not to provide investors with all of the information they need to make an investment decision. Its main purpose is to tell a story, build excitement, and help get that important request for additional information and a follow-up meeting.
In addition to your pitch deck, you should have more detailed, additional information that you can provide upon request. By preparing these additional documents, you can also ensure that you are not trying to fill your presentation with too much overwhelming information.
Tips to make your pitch a success
Here are some tips to make your presentation as successful as possible:
Keep your pitch simple
All entrepreneurs spend countless hours “in the weeds” thinking about every detail of their business. For an investor pitch, however, less information is better than too much. You want your slides to be simple, convey high-level ideas, and leave room for questions. Simple and straightforward presentations are always better than bulleted, detailed presentations.
Skip the balls
Speaking of bullets, skip them. Slides full of bullet points are boring and won’t help tell a story. Try to use large fonts and limit the number of words on each slide. Whenever possible, use pictures to tell your story and create an emotional bond with your ideas.
To tell a story
Don’t just talk about the facts. Instead, focus on creating interest and engaging your audience. Your deck doesn’t have to be the complete guide to your business. It just needs to pique interest so you can move on to the next step.
One of the best ways to do this is by telling stories about how your customers are using your product, how they are currently having issues that need to be resolved, and how your company will improve your customers’ lives. The more stories you can tell that investors can relate to, the more excitement you can build for your business.
Keep your presentation short
Make sure you have enough time for questions, demos, and discussions about your business idea. If you have an hour-long meeting, your presentation should be 20 to 30 minutes.
Don’t overdo the market opportunity
Instead of top-down forecasts where you “need only one percent of a huge market” to be successful, focus on bottom-up forecasts that detail your expectations for customer acquisition.
If you already have data on how an early version of your product is selling, use those numbers to advance the rest of your forecast.
Ask about the money
Yes, there is a slide in the presentation deck above, but business owners sometimes forget to ask for the money. If you ask, it is very important to be able to intelligently discuss how the money is being used. Your detailed financial projections should also take into account a cash inflow.
Keep your deck up to date
Fundraising takes time. You will likely be setting up your business many, many times before receiving an investment. According to legend, Pandora selected more than 300 VC companies before receiving an investment.
Say you’re working on building your business as you raise money and make sure you keep your deck updated with your latest progress, roadmaps, etc. There’s nothing worse than presenting potential investors with an outdated deck.
Submit your deck as a PDF
You will almost always be asked to either pre-send your slides to investors or leave a copy behind. In this case, do not send Powerpoint or Keynote files. Instead, send a PDF. This means that anyone who looks at the deck will see it the way you intended, with the fonts and styles you choose.
Make sure your deck stands alone without your presentation
Your pitch deck will always do better when you show it off, but ideally it should be able to tell part of your story without you being there to tell it. Investors may want to flip through the deck again after your presentation is complete. It needs to have enough content for the deck to stand on its own and communicate some of your core ideas.
Documents to have ready after contacting investors
Developing your pitch deck is only the beginning of your business planning journey. You want to pursue a successful investor meeting with the necessary planning documents to support your presentation. The following are just a few documents to prepare after the pitch.
A summary, sometimes called a summary note, is a two- to three-page outline of your business. It is a document that investors can share with their partners and other companies to get an overview of your company. Your summary should cover what’s in your pitch deck, but in writing.
If you are starting a technology company or a medical company, you may be asked to provide some additional details about your technology. Investors in this type of company often want an expert to review their technical needs. So it can be important to provide more detailed documentation, diagrams, workflows, etc.
Detailed financial models
Any investor seriously interested in your business wants to see detailed financial projections for at least the next three years so they can get an idea of the underlying assumptions that drive your projections.
Investors want to see their plans for hiring and employee-related expenses, R&D expenses, manufacturing costs, marketing costs, etc. Be ready to provide detailed sales forecast, profit and loss forecast, and cash flow forecast. A balance sheet is also often required. If possible, present your data visually with graphs. It has been found to be more effective.
Detailed market research
You may be asked to provide more details about your target market and the market research you have done to date. This isn’t always the case, but when you have the information, it is a good idea to be ready to present it in a specific format. Again, this data shouldn’t be part of your initial pitch deck, but should be ready when prompted.
Start developing your pitch deck
Ready to start? Download our free pitch deck presentation templates and start working on your pitch in PowerPoint or Keynote.
For more additional advice, see our Elevator Pitch Guide. You will learn how to deliver an impressive elevator speech and find all the resources you need to perfect your parking space.
More pitching tips with Peter and Jonathan in episode 10 of The Bcast, the official Bplans podcast:
Click here to subscribe to The Bcast on iTunes »