These Are The Ten Things Your Pitch To Investors Absolutely Has To Have
Investors see hundreds of pitches and pitchdecks each year, and most are poor to really awful. Here's the template you need to ensure you're covering all of your bases.
We have seen a lot of pitchdecks; some good, only a few really special. The best ones have been through hours and hours of refinement.
Being clear about the problem you are solving and your solution is both a science and an art. A science because there has to be factual evidence of the solution to the problem you’re solving; and an art because you have to be creative to find the niche of what differentiates you from your competition.
Here are the ten boxes your pitchdeck absolutely needs to tick if you want to hold investor attention:
- Should be as concise as possible
- Visuals in slides are important, but keep to the bare essence of what’s important
- Start by explaining the problem you’re solving so the investor can understand as quickly as possible the industry you are in. You should not have to explain why it’s a problem. The purpose of a problem statement is to help orient the investor around the vertical and industry of your start-up
- Keep the problem statement short, and explain your solution
- Include one line about why are you different and be clear on your value proposition
- Don’t be vague about your economics and price per unit. Don’t hide it, especially if you’re asked a question. It’s the surest way to lose an Investor
- Be very clear as to the life stage of your start-up
- Founder market fit is often more important than product market fit at the early stage, so explain why you and your team are best suited to solve this problem
- Include a concise section on early wins that show market fit, user growth and revenue traction
- When people copy your tech, because once you have traction they will, explain how you are still going to win? You need to focus on execution and your ability to deliver on your value proposition.
Your Format Cheat Sheet
Our experience with all kinds of pitch decks, both great and truly awful, has led us to a format that start-ups can use as base. It covers all the key items that need to be addressed within your pitchdeck, as explained above, but needs to be refined for the particular nuances of each start-up.
Founders will think long and hard about their name, and come up with something memorable, or quirky. It helps when you are just starting out, to have a name that explains what you do. For example, Uber was originally called UberCab.
This is the company’s purpose; its massive transformative purpose. What is the company going to change in the world?
What problem is the company solving? Keep this brief, your potential investors already know this problem exists; you just need to point to the sector your company will operate in.
What is the solution the company has to the unmet need above?
What is the current status of the business? Give a flavour for overall position, signed contracts, customer traction and credibility in the marketplace. This is where you would insert graphics to show key stats, like growth in active users or partnerships signed.
Current funding raise
Why is there a funding raise now, how much are you looking to raise and what will the company do with the funds? A detailed breakdown is not necessary, just the broad areas, for example tech development, increasing staff complement etc.
List your target revenue that this funding round will achieve in the next 12 to 18 months. We have yet to see a South African start-up include this in their deck, but it’s of huge value. It tells us what revenue numbers you’re looking to achieve and sets out a level of accountability upfront.
What is the size of the market? What is the potential market growth at a macro and geographical level? Include potential market share, while being realistic.
Related: Choosing Your Investors Wisely
What does the competitive landscape look like? Both locally and internationally, given that most investors are looking for scalability.
Key information about the product set, and the value offering.
How does the business generate revenue, how are you monetising your product? How do you plan to become profitable? This is also a good place to use graphics, to present financial information in an easy to digest way.
Insert pertinent info on the financials of the company, including last year actual, current actual, forecast for 2 to 5 years. Use high level numbers only and present it simply.
This info doesn’t always need to be included in the pitch deck upfront, especially if the business model above gives a good feel of the numbers.
Who are the founders? Who is the management team? What are their skills, specifically those relevant to the company? Include photos if possible, and keep it to a few lines per person.
If you have a really rock star team that has exited a start-up before or done some really great work with prominent companies (and we’re talking really great work) – then you can move this section to after your Solution, before Current position.
Pulling it all together
Our final advice: before you send your pitch deck to an investor, have colleagues and/or trusted advisors look through it. You will find their feedback reflective and it will help to refine your thoughts.
Kate Combrinck is an Investment Analyst at Kingson Capital Partners, with a focus on technology assets.
Kingson Capital is a registered Section 12J Venture Capital Company (VCC) founded in 2015. As a Section 12 J VCC, all investments with Kingson are fully tax deductible in the tax year that they are made. This has the effect of both lowering the capital at risk and enhancing future returns for investors.