You have been pitching to investors a couple of times but failed to secure funding.
Probably the reason behind this is not in the product but how you present your pitch to the investors. Having an impressive pitch deck is a key component in your fundraising toolkit.
A great pitch deck gets potential investors excited about your idea and engages them in a conversation about your business, hopefully leading to an investment.
Last week we had the privilege of having, Matteo Rizzi, an investor in the Fintech Space and the Co-founder of www.FinTechStage.com, a platform for Investors, Innovators, and start-ups to foster FinTech innovation globally host a workshop on ‘The Perfect Pitch’.
He shared several things that investors look for in a pitch. We have since put together eleven slides that summarize the workshop and what your next pitch deck should probably look like:
Opening slide and Business description:
According to Matteo, this is the most important slide because it is read when investors have the peak of their attention. In the first 30 seconds, you should be able to communicate what your product is all about.
If they don’t understand what your business is about here, they won’t understand the rest of the deck and will pass and probably lose out on a funding/ investment.
Make it simple but insightful;
Tip: Describe your business in the most simple and straight forward way possible. Do not include the problem you are addressing and the business model, they will come later.
Problem:
The problem statement should come in as your second slide. Ensure that this slide answers the following questions.
What problem your product is addressing and why does it exist? What makes your offering needed by the market? Sometimes this is self-explanatory so try to focus on why YOUR offering is wanted. If possible include statistics and quote studies/ research on the same.
Tip: “Give the feeling of inevitability: that problem is going to be there, and somebody is going to take advantage of it, whether it is you or somebody else,” said Matteo.
Solution:
After the problem statement now tell the investors what solution your product will be bringing and try to convince them through this slide, why you are the best company to solve the problem. Explain your value proposition to serve the problem.
Highlight your USP (Unique Selling Proposition) to prove that you are the right company to solve the problem.
You can use user cases and examples with comparables or any other material that proves your point according to your company’s situation.
Also, keep in mind that this slide should be an answer to the problem you described earlier.
Market size:
Now that the investor sees that there is a problem in the market and a business opportunity to provide a solution, the next logical question is: How big is this business opportunity?
After calculating the market size, target a market share to reach within a # of years. The market share should not be larger than the market share of the present market leader unless the sector is growing through rapid changes and disruption.
Tip: Use references close to your product and solution. Maybe you will want to use local examples as opposed to Global examples.
Competitive landscape and differentiation:
The key here is explaining how you are different than the other players on the market and why customers will choose you instead of one of the other players on the market.
Try and identify several competitors and benchmark your company on a given set of features and highlight how your offering is superior and will stand out.
What do investors want to understand from this slide? That you perfectly understand what customers want, because it is the key to solve the market. Moreover, this slide shows that you studied the market and learned from your competitors’ experience to develop your company.
Sustainable competitive advantage:
The previous slide explains why you are superior to your competitors today. In this one, you should focus on how you will be able to retain your competitive advantage over time in face of new competition that will arise if the opportunity is as big as you pitched in the first slides.
Traction / stage of development:
What have you achieved to prove what you stated so far? Give facts! Traction can be based on a lot of different KPIs according to your business case. Especially in the early stages, companies may on purpose decide to focus on one KPI instead of another, which can be different even for companies operating in the same market.
Focus on giving numbers on the factors that you highlighted as your main competitive advantage in the previous slides.
Business model and monetization:
This slide can also be included before or as part of the previous slide, depending on your case, but it is usually better to separate them.
You should explain here how you will be able to generate substantial cash flows and revenues in the future, which is also connected to your competitive advantage.
Clearly define how the company will generate most of its revenues and when.
Milestones and investment proposition:
“The most effective way to present the capital need and the use of funds is to describe the use of capital in the function of reaching target KPIs,” said Matteo.
Here you can also choose to explain why you need the amount of money you are asking for and how you plan to use the money. Investors will want to know how their money is being used and how it is going to help you achieve the goals you are setting out for your business.
On this slide, make a timeline and outline how the capital will grow each KPI you described in the traction slide
TIP: Don’t give the impression the capital will be used to finish products or startup operations but rather say EXPAND.
Team:
It is a slide that most people overlook but it is equally important. Ensure you have a team put together, probably have their photos, names and also job titles/ roles include. You would also want to Highlight the key team members, their successes at other companies, and the key expertise that they bring to the table.
The team should be cross-functional. It is important to have a team that, at the current stage, can already deliver upon the most important elements for building the venture.
If you don’t have a complete team yet, identify the key positions that you still need to fill and why those positions are critical to company growth.
Conclusion
Finally, do not overlook this slide. It is equally important. The conclusion slide should include a Thank you note and contact details i.e Email address, Phone number and Company address (geography is an important factor)
Tip: Include only one contact person. He/she should oversee fundraising, better if it’s the CEO: investors want to talk to leaders.
Although you have your pitch deck together also ensure that when you are meeting with investors you also have with you a more detailed, additional information that you can provide if requested. This helps you ensure that you don’t try and fill your presentation with overwhelming information.