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Published on: 3rd September, 2020
Written by - QAPITA Team
Your pitch deck is arguably one of the most important documents that you will create in your entire venture. Having a great pitch deck is the key to getting potential investors interested in your company, leading to subsequent meetings and ultimately, an investment.
So, what exactly is a pitch deck? And more importantly, what makes a perfect pitch deck?
A pitch deck typically consists of 10 to 20 slides to give a short overview of what your company is about, the problem you are solving, who your customers are, the business plan, the vision and the team.
The pitch deck will be the very first impression of the company for potential investors, and hence, its importance. Studies have shown that a first impression is formed in the first seven seconds of a meeting, and some research further suggests that a tenth of a second is all it takes to determine traits like worthiness - allowing investors to have confidence in you and your business.
Qapita ProTip: Form matters as much as the substance. The pitch deck forms the first impression of a potentially lifelong relationship for the Company.
Before thinking about what to include in the pitch deck, one important thing to consider would be your audience. Who is your audience? Is your audience familiar with your market? What is the medium that the deck is being presented in? Especially in the current post-covid world, there is no one-size-fits-all when it comes to a pitch deck - Qapita has compiled a checklist for making your pitch deck as perfect as possible.
1. A Catchy Cover
The cover of the pitch deck should be simple and yet eye-catching, so as to incite curiosity in the audience. It should be on brand and convey the name, the logo and your catchy tagline. Remember, this is a marketing document.
2. The Problem You Solve
An investor is interested if he is convinced customers would be interested. You need to convey your customers’ problem in a clear and direct manner. It needs to be an indisputable problem, and ideally something that the investor can relate to. The more real the problem is, the more investors will want to dig in deeper into your business.
3. Your Solution
The solution page addresses your approach in solving the aforementioned problem. This may include your product and its features that alleviate the customer pain points. Try to avoid technical jargon if you are not sure of the technical proficiency of your audience - a fresh graduate should understand you.
4. A Captivating Demo
Here is where you showcase the company in action. The best alternative to a live demo is a video demonstration. This should showcase the key features of the product and how exactly it is used to solve the problem.
Qapita ProTip:Ideally, your product demo should make for the peak experience of the pitch. Refer to Daniel Kahnemann’s peak-end theory - people remember the peak and the finish.
5. The 'Large' TAM
This is where you delve into the size of the problem for the investors to make an initial judgment of the potential size of your business. You should have well thought out numbers, credible sources and delineate how exactly these numbers are derived.
Qapita ProTip:Test your TAM estimations with experts in the industry. You may not be able to convince everybody, but you need to be able to convince a few.
6. The Business Model
How will you make a business out of your idea? You either need to demonstrate how you make money or you need to demonstrate how you can eventually make money - Who is paying? How much? How will you bill (premium, freemium, promotions)? What is the value proposition to the purchaser?
7. Performance Indicators
Following the business model, what would be the defining metrics that you measure your success on? What are the key parameters on which you will measure your team? This will usually be financial or customer centric or usage centric parameters.
Qapita ProTip:What metrics do you want to track 24/7/52? What metrics, when inadequate, will keep the Founders awake at night? If you measure correctly, you can fix it appropriately.
8. Financial Metrics
At the end of the day, a business has to stack up financially. A good investor will give the right weightage to this based on the performance indicators. Typically some or all of the following are included - unit economics, 3-year projections, path to profitability and capital requirements (or burn rate).
How are you different from others? It would be ideal to have a chart, graph or a diagram to articulate your competitive advantages. You could also consider precedents in other markets and the capital being deployed into this sector.
Qapita ProTip:Remember, if you are chasing a big problem there will be competition. Do not try to engineer a unique early mover position - investors know that eventually, good execution wins.
10. Why this Team?
At early stages, this is probably the most important reason for investors to buy into the pitch. At later stages this emphasis shifts to performance indicators. Highlight backgrounds, experiences and capabilities that made you go after the problem with this team.
11. The Bold Vision
It will be good to chart the long term journey that your business can make. This is particularly useful if you are chasing a large problem with a disruptive solution. Use this to set the stage for the call to action.
12. Call to Action
Here comes the “ask” slide. Summarise your ask for capital and where you would deploy it. Articulate where the money sought will get you in terms of your performance indicators. Articulate the support you expect from your current investors. Expect questions. Be prepared with responses.
Qapita ProTip:The funding ask is where you may negotiate if the pitch moves to subsequent discussions. Convey flexibility (or hard conditions) and urgency as the case may be.
Allocate sufficient time for questions and answers along the way and towards the end of the presentation. Budget 10% of the allocated time for introductions, 40% of the time for the pitch and 50% for interactions and questions. Have supporting slides to help you address the questions you anticipate (e.g. pricing, market expansion, product roadmaps).
Here is a checklist of ingredients in a perfect pitch:
Form of the pitch deck
It has been proven that people focusing on a visual task are unable to hear what is going on around them. The strength of a slide is inversely proportional to the number of words on the screen. In addition to the content, it is crucial that the pitch deck have a consistent style and fonts throughout the presentation. Incorporate the company’s personality into the design, using fonts, colours and images that suit the branding and resonate with the company.
Substance of the Pitch
Ultimately, the perfect pitch deck has to be presented with confidence, enthusiasm and passion. The right tone and a well designed pitch deck are the winning combination.
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