Pitch deck - an investor presentation that will help you raise financing
The idea itself and even the most well-thought-out plan for its implementation is often not enough. It happens that the capital available to entrepreneurs is not able to cover expenses, enabling the planned activities to come into effect. For a large part of ventures, especially those taking their first steps, additional financing becomes necessary.
The key element when applying for external financing is to convince investors of the potential of a given venture and to present it fairly. One of the necessary stages of this process is the preparation of the so-called pitch deck. What is hidden under this name and what elements it should contain, you can learn in the article below.
What is Pitch deck?
To a large number of people, this type of document may be known by the term investor presentation. In business jargon, the word "pitch" means a concise as well as factual form of presentation of yourself, your service, company or idea. Exactly these goals are to be met by the pitch deck created for a given venture. In short, it is a document in the form of a presentation, aimed at presenting our idea to potential investors in the clearest, most concise and convincing way possible. This type of presentation has a specific structure and should contain specific elements, which you will learn more about later in this article.
Who needs Pitch deck?
"Pitch" will be needed by any entrepreneur wishing to support his business with external financing. This includes raising funds from various types of funds such as Venture Capital, as well as individual investors.
Basic principles investor presentation
In terms of content, we can compare the pitch deck to a kind of business plan in a nutshell. The assumptions are the same in this case, but the two documents differ in form. The presentation in the form of a pitch deck is designed to organize information, in a much more concise manner, allowing it to be presented in a severely limited time frame, which is usually only a few minutes. Below we will outline a few good rules of thumb that will come in handy for creating a good pitch.
- This type of document has a specific structure, which we describe in more detail later in the article. It should begin with an engaging introduction, describe details of the product or service, present the value and size of the target market, as well as competitors.
- Information on slides should be presented in a clear and "pleasing to the eye" manner. It is important to avoid too much text.
- A single slide should present information on no more than one issue (e.g., product or market). Ideally, one slide should correspond to each element of the presentation. Definitely, individual issues should not be presented collectively.
- It is recommended to avoid industry jargon - specialized vocabulary can be incomprehensible to a person outside the industry. If you want to raise additional funds for your venture, it is on your side to make the presentation to the audience clear and the product concept easy to understand.
- The aesthetic appearance of the presentation will definitely be a plus, but the key here is definitely the content. Even the most aesthetically refined "pitch" will not be competitive if its content is not at a high enough level of substance.
- Tailoring the content to the selected audience - depending on the sources from which we wish to raise financing will vary somewhat. If, for example, we would like to raise funds from a VC fund, Private Equity or Business Angels, we should focus on highlighting the potential of the venture to generate (depending on the level expected by a particular investor) satisfactory rates of return.
What elements should include Pitch deck?
As you already know, there is a generally accepted structure for creating pitch decks, which is a kind of standard, among emerging and seeking financial support companies. In this paragraph we will briefly describe each of its elements in turn:
- Introduction: The first slide is designed to intrigue and catch the attention of a potential investor. It should include elements such as the name of the company, logo, appropriately adapted graphics, as well as a specific and catchy slogan - briefly but bluntly presenting the venture.
- The problem: The product you offer should relate to a real-world problem that your venture is designed to solve. In this slide, you should accurately present the problem mentioned earlier and emphasize the relevance of its solution to the environment.
- Solution: The task of this section is to present your unique solution to the problem diagnosed earlier and how your product will help deal with it.
- Potential market: The market slide serves to present data such as the size, value and potential of the market you plan to enter, as well as an indication of the target audience your product or service will target.
- Product: The part devoted to the product is responsible for its comprehensive presentation, pointing out its features and uniqueness against the background of the competition operating in the market.
- Roadmap: In this stage of the presentation, all past and planned activities related to the development of the product or service should be presented. The slide can take the form of a bullet-composed, chronological list.
- Traction: The information on this slide is a kind of confirmation that the solution has growth potential and, depending on the stage it is at, is likely to be adopted or has already been positively accepted in the market. These will be, for example, data on whether the product is "selling" and how interest is growing or will grow. They should present the recipient with opportunities to scale up.
- Business model: This slide should present how the idea will create value. It will include elements such as a financial model. Specific numbers and cash flow projections for the coming years are important here. This type of model will enable both investors and the creators of the idea to see if the venture is capable of achieving profitability and producing the planned profits.
- Competitive analysis: The part devoted to this analysis will be responsible for presenting to investors the companies with which you will be given to compete. It is important not to approach the evaluation of competitors too lightly. The presentation should truly reflect the situation of the environment affected by the venture. It is also important to emphasize how our proposal creates unique value and thus sets us apart from the competition.
- Financial data: In this section, outline all aspects related to finance. These will include issues such as the planned amount of funding needed for the project, the funds that have been allocated for it so far, as well as information on what activities the amount raised will be spent on. This section should also include a proposal for the shareholding structure before and after the investment.
- Team: This part is responsible for introducing the founding team. The slide should include information about its members - what they currently do, what their experience is, and why (in short) an investor should trust them. Mentioning successful ventures implemented so far will be of great value to the audience and positively affect the credibility of the team.
- Contact information: The slide should contain all the necessary data for contacting the team. In addition, it can also contain a few bullets with a short summary, telling why investors should choose us.
The most common mistakes errors
- Too much content - Depending on the level of complexity of our product/service, describing it in a concise manner will be more or less problematic. Due to the limited time of the presentation, one should remember not to go into too much detail. In this case, the rule applies - the more specific, the better.
- Poorly chosen graphic identity - despite the unquestionable superiority of the substantive content over the graphic aspect, it is worth that the appearance of the presentation is in some way associated with the theme of our venture and the industry in which we intend to operate. An imaginative approach to this issue is also a great opportunity to stand out from competing "pitches" and become memorable to the audience.
- Overly optimistic forecasts and representation of the market situation - By definition, when convincing investors of a given venture, its scenario should be positive, in order for it to be possible at all. However, there should definitely be no deviation from reality in this regard. The figures and data presented should be credible and supported by real facts.
How many slides Should the Pitch deck contain?
Imagine a situation where you are trying to get funding from a Venture Capital fund. The number of pitch decks sent per week to such funds is counted in the hundreds. It is therefore extremely important that getting your idea known does not require spending too much time and does not leave the recipients in doubt.
Based on our observations, we can deduce that the optimal number of slides of the pitch deck will be between 10-19. It is worthwhile not to exceed these limits, even if the implementation of our idea is somewhat complex. The time for a presentation in front of investors is usually severely limited, so it is important that each issue is presented as clearly and concisely as possible.
The concept of a pitch deck is not new. Such presentations have been created by emerging companies for decades. On the Internet we can find pitch decks of such start-ups as LinkedIn, whether Facebook from almost 20 years ago.
Do you need a pitch deck? Get in touch with us!
Even a great plan, presented in an unsatisfactory manner, can derail the chances of getting funding to allow a given venture to get off its feet. A well-executed "pitch" can make a real difference in whether an idea catches the attention of potential investors and convinces them to commit to your venture.
Despite the generally available knowledge on how to create this type of document, key elements such as market analysis, competition, and financial model can be problematic to develop in-house.
For this reason, it is worth considering outsourcing its execution to companies that deal with their creation on a daily basis. Recently, we carried out a project to prepare a pitch deck for Choicer. You can learn about the details of our cooperation in the developed by us case study.
A quality pitch deck can prove to be an investment that provides an invaluable return. Standing out among the numerous competitors and obtaining funding, can determine whether your idea has a chance of turning into a viable venture. For these reasons, it is extremely important to ensure that you execute this presentation to the highest possible standard.
If you, too, want to start scaling your business, attracting external funding, business partners, and gaining new customers - you'll want to start scaling your business. check out our offer!
Contact us, if you need support in implementing a pitch deck or part of it! We will be happy to tell you how we can help you and what will work best for you.