Pitch Deck: Elements, Strategies, Examples and Template to succeed

Harsh Verma- FinEndorse

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Pitch Deck: Elements, Strategies, Examples and Template to succeed

What is a pitch deck?

 

 

A pitch deck is a brief presentation used by entrepreneurs to overview their business to potential investors in a face-to-face or online meeting. It is essential to have a comprehensive and well-designed pitch deck to convince your investors about your growth potential and have the demanded resource that could help you to scale exponentially in a J-curve.

 

Your pitch deck could have around 10 to 20 slides so that you could easily convey the vision, opportunity, product-market fit, and business model to the potential investors. Your pitch deck would vary depending on the situation and what you ultimately want to achieve with it. 

 

 

Pitch Deck for ‘Demo Day Presentation’ Vs. ‘ Pitch Presentation’

 

 

Demo Day is a term used in the startup accelerator industry where the founders get the opportunity to showcase their idea and execution to several startup investors or VCs.

 

Suppose you were at Y-Combinator for your demo day presentation. You would need to design your pitch deck so that the entire crowd can easily see what you are trying to convey and why this group of investors should even care about your offerings. In this case, you would generally be presenting in front of an audience on stage, which requires you to focus more on the visuals and has less text. As you might have already guessed the reason, people sitting far from the stage would neither be able to read what is written on your pitch deck nor would they care to read everything. 

 

A demo day presentation generally has many investors and several startups pitch to them. It becomes highly critical that you utilize your 5 to 15 minutes in the best manner possible in such a case. Also, this short period should be captivating and catchy for the audience to be interested in talking with you backstage.

 

On the other hand, a pitch presentation could be used to showcase your startup’s achievements and possibilities to the potential investor on email or LinkedIn. If you are trying to use your pitch deck for a pitch presentation, it should be self-explanatory and answer all the questions that could come into the potential investor’s mind. It means that you could focus on visuals and texts simultaneously in this pitch deck.

 

Many pitch deck platforms would allow you to track your investor’s activity on your presentation, which means that you could easily figure out if the investor read 100% of the slides or ignored the slides with many texts. You could use this information to improve your pitch deck and make it perfect for your next investor. 

 

I know this could sound frustrating and heartbreaking; however, it is a stage that you will have to go through to become the founder of a successful business. I am saying this because you will have to go through several denials, no replies, and you’ll have to try to connect to hundreds of investors to get that one who would be likely to invest in your idea. Guess what? After 5 to 10 years of leading a successful business, these denials, frustrating moments, and utter confusion would be the memories you would cherish.

 

Founders trying to connect with their potential investors via cold emailing is a common strategy in the startup world. The best practice is to send a personalized message and give a reason to the investor to open your email and care about what you have to offer. Your email should not be about asking for investment directly. However, you could use the strategy of introducing yourself, showcasing why do you care to connect with that individual, and politely asking them if they would like to see your pitch deck. 

 

These investors generally get a lot of cold emails from several startup founders; hence it becomes necessary that your email stands out and not gets drowned in the ocean of cold emails.

 

 

What is the industry-wide accepted pitch deck outline?

 

In the startup ecosphere, the startups sometimes try to reinvent the wheel and create different versions of what they consider the pitching presentation should be elements. However, the investors generally expect you to have the following 12 slides in your pitch deck. And, if you are new in this field, we would highly recommend you follow the industry standards and keep the investors interested in your idea. We would also talk about how Airbnb worked on its pitch decks.

 

1. Introduction

 

Some people in the startup ecosphere would suggest you start with the problem slide. However, no matter how professional a person is, they want to work with a human with a purpose. It would be best to start your presentation or pitch deck with an introduction slide that conveys who you are and why you are here. It would be best to keep it short and simple but also maintain professionalism.

 

2. Problem

 

The general purpose behind starting a company or a startup is always to solve a burning problem of the masses or make the existing process simpler and more cost-effective. Generally, the startup founder would have a personal reason to solve that problem.

 

The founders would only be able to entice the investor’s interest if the problem needs a quick solution, and the customers would be disappointed if they didn’t have the option to use your product now. It is also referred to as a product-market fit, where the customers are willing to pay for your service or product as it solves a big problem in their life.

 

Airbnb listed that price is a big concern for travelers, hotels keep you disconnected from the culture, and there is no way to book a room with a local or become a host.

 

3. Solution

 

Every problem needs a solution. When you have sold the problem to your investor, you have to convince them that a big chunk of the population would be interested in your product or service. This slide should not contain the fancy features in your app. Instead, it should be about your main product and why it would be a big hit. You could keep the fancy features and other vital information of your product for a face-to-face meeting.

 

Airbnb brought forward a web platform where users can easily rent out their room to host travelers, ultimately saving money for the traveler, helping the locals get more revenue from their empty rooms, and ultimately sharing culture between the two.

 

4. Product

 

It would be best if you now talked about the basic functionalities of your product, how it will change the behavior of your target audience and why people would end up paying you. Try to keep it as simple as possible not to confuse the investor.

 

The web platform by Airbnb allowed you to search out the listings in a city, review the listings, and book the place for the specified time in a single click.

 

5. Market Size

 

In the market size slide, you need to talk about the total addressable market, serviceable addressable market, and your market share.

 

Total addressable market(TAM) is the global demand for a product or service generally calculated in annual revenue or unit sales. The serviceable addressable market(SAM) is the subset of TAM and constitutes the part you can reach. You need to calculate the total possible revenue you could earn if you had captured a hundred percent of a specific market limited to geography, democracy and other factors that segment the market for the product or service.

 

In the case of Airbnb, they calculated the total addressable market as the trips booked worldwide, which was almost 1 .9 billion. Then they segmented out the serviceable available market to budget and online trips, around 532 million. As per Airbnb, around 10.6 million online trips were booked through Airbnb’s web platform, which was their market share.

 

6. Business Model

 

This slide should talk about how you have planned to earn revenue and scale your company. For example, some SaaS companies have freemium business models that give customers a free and small variant of the full offer. In contrast, other businesses could take a commission to earn revenue.

 

Airbnb’s business model takes 10% commission on each transaction. From 2008 to 2011, Airbnb had almost 10.6 million online trips registered through them, and their average commission came to $20, considering an average transactional fee of 70$/night for 3 nights. This equated to total revenue of more than $200 million.

 

7. Market Validation

 

Market validation is a process of determining whether there is an actual need for a job product. You must do market validation and list it in the pitch deck, as it would be the most prominent slide to catch your investor’s attention.

 

Airbnb figured out that 630 000 people had registered on the temporary housing sitecouchsurfing.com. Also, 17,000 temporary housing listing was on SF and NYC Craigslist from 07/09 – 07/16.

 

8. Competition

 

In any industry or niche, like-minded people would be trying to solve a similar problem as yours and gain market share. It would help if you had a proper understanding of who you are directly competing with and your stats against them.

 

In Airbnb’s pitch deck, the founders had mentioned their competition like Craigslist, hotels.com, VRBO, rentobi.com. However, they were also clever enough to state that their advantage was affordable and allowed online transactions.

 

9. Competitive Advantage

 

It is quite obvious that they would be players who could be serving your potential customers already. However, it would help if you had competitive advantages to easily dominate the market and get the biggest chunk of market share. User-friendliness, cost-effectiveness, 1st to the market, etc., are some examples of the competitive advantage you could probably have.

 

In the case of Airbnb, they had the following competitive advantage:

-1st to address the market

-Host Incentive

-List Once

-Ease Of Use

-Profiles

-Design & Brand

 

10. Traction & Marketing Plan

 

Traction means the revenue from the set of customers already using your product and also paying your brand for that. Along with that, you could also shortly define the marketing plans with which you could acquire new customers at lower costs and have a higher lifetime value of the customers.

 

11. Team Slide

 

The people in your team do the magic and make a business successful. It is crucial for you to show the people behind the scene and briefly describe their role in the company. Investors would generally prefer to know who they are investing in and how passionate they are to make their idea successful.

 

12. Underlying Magic

 

The last impression is as crucial as the first impression. At the last slide of your pitch tech, you can talk about your team’s underlying magic or the process that makes you unique and highly scalable. Investors love to partner with founders who already have a proven track of success, or if their process and execution method is unique, that could bring them an insanely high return on investment.

 

 

6 strategies to design a perfect pitch deck and have a fantabulous demo day  

 

 

1. Tell the investors a story that motivated you to work on your idea and keep them engaged emotionally.

 

It is expected that a successful startup founder must have a strong reason for starting the business to be motivated even in the darkest hours and give a major chunk of their life into building this business. Be sure to have answers to WHY, WHAT, and HOW. It means you should clearly state the reason behind working on your business idea. Then it would be best if you told what the business idea is, and finally, state how you would achieve your desired results.

 

2. Follow the industry standard pitch deck outline.

 

Ensure that you limit each slide to expressing one idea to avoid confusion. Don’t reinvent the pitch deck wheel and follow the industry-standard pitch take outline as mentioned above. All the points in the pitch deck half their specific value. For example, the problem you are trying to solve is as important as the business model you are trying to implement. Hence, don’t overcrowd your slide with excess information and give every point equal value.

 

3. Give your best to make a great impression if you talk one to one with your potential investors.

 

The time you have to showcase the value and opportunity that a startup has should be used best. Nobody cares about how you begin your day or which immediate problem has put down your mood. The investors would only judge you based on how you give them the first impression and how successful you are in selling the idea, execution, and opportunity to your investors.

 

4. Talk about your team and their roles in the startup.

 

The employees make a company successful. You must show your team to the potential investors. People generally tend to see you as an authority when they see actual people working behind the scenes. These are the people who would ultimately spill magic on your idea and make it a unicorn. Hence, be sure to talk about your team and their roles in the startup.

 

5. Be consistent with the pitch deck design and make sure that you speak on the topic of the slide.

 

You need to maintain consistency in your pitch deck to look professional in meeting with potential investors. Make sure that you use the same font, size, color, and capitalization format across all slides of your investment pitch deck.

 

6. Talk about your metrics and KPIs.

 

Your passion is important to keep you motivated during the tough times of your business. However, if you need to raise funds, you will have to talk about your metrics and showcase how prominent the growth of your business looks. The investors would expect you to have the best grasp on your metrics than anyone else. Hence, it becomes crucial for you to not make any mistake with the metrics as it would bring your brand value as a founder and decrease your credibility. You were the one building the company from the ideal stage and have spent the most time on it. Thus, you cannot afford to make any mistake on your metrics and KPIs.

Harsh Verma- FinEndorse

Harsh Verma is a passionate SEO marketer and content writer. He believes in helping other fellow entrepreneurs succeed in this competitive digital atmosphere.