As your startup's mission, scope, and approach pivots, so should your approach when building an investor pitch deck. If you want investors to trust you with their money, you need to show them that you have done your homework on what they want to know and have prepared your pitch accordingly. Below, you will find nine tips on how to build an effective investor pitch deck to get your desired result. By the time you are done putting together your pitch, you should be able to explain the startup's business model, its development, and what traction you have for your startup.
1. The Problem
Consider the business model canvas and what problem you are trying to solve. Investors want to know what you have done to define the problem. Go beyond ideation and generalizations to specify the pain points of your customer and how you reached this conclusion. Explaining the problem is an opportunity to explore why it is substantial enough to develop a solution and fund your startup.
This is also an opportunity to add an element of storytelling to define the problem if you have a personal anecdote that leads to the discovery or realization of the problem. Showing investors you understand the problem you are solving at a deep level, indicates the solution you provide also includes this same depth of research and care.
Investors want to know more than just what your solution is. They want to know why it is the best solution and how you came to that conclusion. Key items to include are the potential customers you have spoken to, sample size, and what tests or research you have conducted. Show them you have developed the solution in collaboration with the people it was meant to help, rather than in isolation from them.
Show investors you understand what ecosystem you fit into and the audience you serve. With a problem and solution clearly defined and vetted, who is going to buy or use it? Investors need a clearly defined pathway to the commercialization of your product or service. This is also an opportunity to bolster your proposal with meaningful research to validate where you fit in the existing or newly defined marketplace you are going to occupy.
4. Market segmentation
Once you define the space you occupy, specify who your customers are. Each of the elements described thus far are an integrated effort to demonstrate the development of your business model and the product market fit for your startup. Chances are, the people you interacted with to develop your solution and define the problem will also inform how you define your market segmentation. This is the section of your pitch where you provide figures showing the total number of people who would want the solution you are proposing and what percentage of this population are viable customers.
Your key differentiator may vary depending on whether you are entering an existing market or developing a new one. In either case, show investors you understand what already exists and how you compare to the competition. Examples include charts showing the advantage of your offering compared to others and any other visualizations demonstrating how your USP is the best option. Use this section as an opportunity to explore the most compelling way to make your startup stand out.
Does your startup have momentum? Try to quantify who is interested in what you are doing and what you know about them. This traction could come from a crowdfunding campaign for pre-orders, a growing email list, equity crowdfunding made available by Title III, or other kinds of attention and movement around your startup. Show investors a commercialization roadmap that can scale for exponential growth. If investors cannot see a clear ROI, and you are unable to illustrate where you are now and the pathway to get where you want to be, there is no incentive to invest.
Running a startup is hard. That same difficulty can amplify by however many co-founders and team members you have. Investors want to know the strength of your organization, experience, and qualifications before they consider working with you. If you have achieved milestones in the past with previous ventures or your career before this startup, highlight them in the context of why your team is in the best position to solve the problem you have defined. Beyond sharing what you have already done, investors need to feel confident that you can handle the difficulties that lay ahead of your startup. Adaptability, discipline, perseverance, and passion are among a few desirable traits that demonstrate you have a team they can trust.
Make sure to include the following in your ask: the amount you are raising, how you are raising the money, and the comparing valuation and note cap with a discount amount if applicable. Options such as an equity round, SAFE (Simple Agreement for Future Equity), or convertible notes each have an appropriate place in the investment lifecycle. Depending at what stage and what round you are raising money for, you should have a firm understanding of the timeline for an investor to see a return on their investment and any other payments according to the terms you negotiate.
9. Contact Info
All of the effort you put in your pitch deck will be for naught if investors cannot reach you. Make yourself accessible to questions and be open to comments, notes, and feedback about your pitch deck. As long as the communication is constructive and helpful, developing a rapport with investors who may not invest right away could potentially open doors later on.