Startup Pitch Deck: This is what you need to get early-stage investors
First of all, why do you need a pitch deck?
Every month we get tons of applications for our incubation program and get to know a lot of interesting startup founders. Some just starting and working on their first product and some very advanced and looking for serious investments. Whatever startup founder, or soon to be startup founder you are, a pitch deck is a must-have when you are looking for funding or mentorship.
Why investors want a pitch deck
A lot of incubators, accelerators or venture capitalists don’t have the time to let everyone pitch their startup or idea. Taking this into consideration, it is important to highlight the core elements of your concept so the reader can see immediately how interesting the concept is for them. You can see the pitch deck as the resume of your startup. You wouldn’t apply for a job without a resume, right? We can get insights from your deck very quickly and see if there is a match.
The benefits of having a pitch deck
Every time you apply you can use your pitch deck and improve it when you get feedback. Before you send your application you have all the time to work on your pitch deck and get the right first impression to the readers. No worries for blacking out during a pitch or missing information in your presentation. If you follow the structure mentioned in this blog you can create the perfect pitch deck.
Your first investment?
In our incubator, we mainly focus on early-stage investments. What is the early stage of a startup? Well, that means there is some sort of minimal viable product (MVP) and you did your research on the market. You are the expert in your field, showcase this in your pitch deck, but don’t overcomplicate things. We are probably new to your product and maybe even the market you operate in. Early-stage investment partly means investing in ideas. But without the research and a minimal viable product, you can have extreme ideas that would be hard to execute and invest in. Like going to Mars or connecting your brain to a computer. Oke, nothing is impossible, right Elon?!
How to write your pitch deck
Tell your story, how did you come up with this idea. What challenges did you have so far? One of the most important things, it does not matter if it is with your pitch deck or with a live pitch, get them enthusiastic about your startup as soon as possible. Get them curious and show them your jaw-dropping startup.
The investor’s point of view
What do you think an investor is looking for when investing in a startup? Well, the investor’s goal of reviewing your startup is to get insights into your product, your market, the acquisition of the customer and in you! Is your product really the solution for your market and are you capable of acquiring the customers? It’s necessary that you can prove that you can create the product and acquire the customers in the market. If you can do this, you probably have an investor.
No one wants to read 100 pages of boring information. Even if you get to manage someone to read 100 pages, will that be effective? It can’t be that hard to explain the wow factor of your startup. You don’t have to be a graphic designer to create a compelling startup deck. With free, and easy to use, tools like Canva or something like Powerpoint you can do the job. A good, and now famous, example for a pitch deck was created by Airbnb. In their first slide, they immediately grabbed the attention.
An appealing first message
Book rooms with locals, rather than hotels? How is that possible?! That must be one of the thoughts that got through the heads of the investors when they saw this slide for the first time. We all know what happened with Airbnb after that. You get curious after seeing this first slide and want to know more.
What the pro’s say about pitch decks
Several venture capitalists, incubators and evangelists have created different views of what they consider as the perfect pitch deck. Slidebean made a graphic overview and shows exactly what information a few venture capitalists and startups consider to be mandatory in a pitch deck.
What to put in your pitch deck
We also got our views on this and for this reason, we only go through the topics we think are important. This does not mean you always need to leave the other elements out of your pitch deck. Create your view on what you think is important to tell your potential investors.
As I mentioned before. No one likes to read 100 pages of boring information. But I don’t want to set a limit on the number of slides you want to share. The range that is given in the Slidebean graphic is a good range to stick to. As you saw in the AirBnB title slide I probably don’t have to mention what the impact of a good title slide could be. Remember that the first impression starts at the first slide.
One of the first things you can show in your deck is the problem. What problem does the market have? What gap in the market is it that you can fill? Make it understandable for the investor. The investors need to know what pain there is otherwise the solution to the problem will be very hard to explain. I would recommend making different slides for the problem and the solution as you don’t want to overwhelm the investor.
You probably guessed what the next slide could be. Yes, the solution. What is the solution to the problem you just mentioned? Your product can solve the problem. Show your readers how you are going to do this. You can show your product and the benefits of your product. Depending on the complexity of your product. Try to do this in 1 slide.
Ok. There is a problem, there is a solution, but is there a market for your product? This slide will contain information about the market your product will operate in. What does your target group or groups look like and what is the size of your market. This is a really important factor for investors as the market size must be big enough to scale your business and give the investors a return on investment.
For an early-stage investment, you can show how you validated the product-market fit as this is an important milestone as a startup to grow your business. Have you already tested your product with customers or are you still trying to find product-market fit?
Your business model
Maybe you have found the perfect target group. The best solution for a major problem in the market but if your business model is not profitable enough it’s not going to work. In this slide, you easily explain how your startup is going to make money an eventually give a return on investment to you and the investors. Airbnb did an excellent job in explaining how they make money off providing a platform for people to rent a room with locals instead of hotels: “We take 10% commission of each transaction”. As they already explained what their market share is or would be they could pinpoint what their revenue could be in the next few years.
If there is a major problem in the market you are probably not the only one that noticed. For that reason, you always research possible competitors. Maybe no one has the same solution to the problem you outlined but is there a competitor that solves the same problem in another way. These competitors should also be mentioned as they can affect your business model and return on investment. How are you different from them and how do you know you can solve the problem more efficiently than they do.
This will probably be the easiest part. Who are you and who is in your team. It may sound like one of the less important aspects of a pitch deck as you are probably most focused on the business model and running the business but for investors, you and your team are one of the most important aspects if not the most important aspect within your startup. You run the business. If you run the business in the wrong direction. Well, you know where this will go. Also, if you take some investors on board or you need mentorship from investors. There also needs to be a good match in the sense of personality between you and the investors. So introducing yourself and your team the right way is something you should think about.
Make a slide with your accomplishments, milestones, and challenges in the near future. This is also a good intro for where the investments will go in a slide about fundraising.
Funding or other goals
In our case, we not always focus on fundraising. We also help startups by mentoring them, providing office space or housing. Even if you want to scale your business in the Netherlands and you are from another country we can help you get a startup visa. So for us, a slide about fundraising could be interesting if that is your goal. But if you want to scale in the Netherlands. Tell us your goals and how we possibly can help. Or maybe you want both. Whatever your goal is. Be precise in what you want to achieve and how you plan to do this, why you need us and why you think this would be a match.
With all this information you can create a pitch deck that will fit our needs in providing enough information to review your startup and maybe invest in you and your startup.