3. How do you build your startup pitch deck?
Note: this is Part 3 of Fractionalist’s Startup Fundraising Series for Early Stage Companies.
It’s more than a formulaic presentation with a bunch of stats
Google “what to include in a startup pitch deck” (see here and here) and you’ll find hundreds of articles and videos on building your 10-12 slide investment presentation, and what successful decks look like. The formula is pretty simple; intro, opportunity, market size, solution, product, team, the ask, etc.
The Fractionalist team has reviewed and helped improve hundreds of pitch decks. What truly exceptional presentations share are three things: a compelling narrative, company strengths highlighted early on, and a clear path to revenue.
Create a narrative
DocSend released some data in August 2020 saying that on average an investment deck is reviewed for 3 minutes and 40 seconds. Successfully funded decks were reviewed for closer to 2 minutes.
Can you tell a compelling story in person or slides in that amount of time?
The answer is: you better be able to.
Most presentations are chock full of statistics about the size of the market and the growth of the company. Few tell a story.
We recently advised a company in the freight space; think domestic trucking. They have great statistics around the size of the market, how it can be disintermediated, a strong list of customers and partners. Reading the deck I was struck with “so what?”
Talking with the founder brought out the power of her story. She grew up in a trucking family and her knowledge and passion around the business was missing from the traditional deck format. She uniquely has insight that makes her the right leader to change the industry.
By incorporating her personal story, including more images, and using statistics to emphasize the importance of investing now, the founder had more of a memorable story- and a far more compelling pitch.
Pull your strengths forward
When you’re focused on all of the daily minutiae of your business, it’s easy to get lost in the details and not see what makes your company compelling. An outside perspective helps pull out the stories, statistics, and proof points that differentiate you.
Here are some examples to think about:
Team (with experience): Has your team done some interesting things in the past? If you have worked at some big name companies, get those logos on the slide. If you have experience building products or have had an exit, get it up there. I like the format of big bullet points for the team; “X years experience, $XX M raised, 5 exits”, etc with a basic highlight (singular) for each of the team members. These decks can get so noisy when the only takeaway should be “yeah, these are the people to do this.”
Team (without experience): Even if your strengths are not specifically in the field you’re building your business, things like being a 5-time Emmy award winner or nationally ranked tennis player are elements to highlight if you don’t have exits or interesting logos to put up on your team slide. Again, the question you have to answer with the team slide is “will this team have what it takes to win in this space no matter what?”
Customers: Have you been able to close marquee customers and is it repeatable outside of your first and second degree connections? What are these customers saying? Is this a vitamin, aspirin, or Viagra when it comes to need for them? In other words, is it a must-have or a nice-to-have?
Traction: Traction is about repeatability and scalability. Will you be able to continue to grow beyond your initial “friends and family” customers? Can you show growth month-over-month for the last 6 months? 12 months? Are you able to keep your customers?
Competitive advantage: What is your competitive advantage right now? IMHO these advantages tend to be fleeting, but it can mean the difference between winning the market and duking it out with a bunch of competitors.
When we launched Urban Airship, we were live the day push notifications worked on iOS. We had that advantage for about 90 days as the only game in town. It's what allowed us to dominate the market against established and better-funded entrants before and after that initial advantage.Product: Does your product do what you say it does? We were advising a company in the supply chain space. After reading the website and seeing the deck, we still didn’t get it. It wasn’t until we saw the product in action in one of their micro-distribution centers that we completely got it. When you have a hard to explain product, that’s where narrative becomes even more important.
Show them the money
Investors expect a 10x return on their investment. Does your deck clearly show them how you will make money?
It’s relatively easy to find statistics that show your total addressable market is massive. How do you succinctly show that without inundating the reader with meaningless numbers? How big is the serviceable market? If you can boil these numbers down into something that is really clear to the potential investor you’re going to look far more credible.
Pitch Deck FAQs
Do I need a pitch deck?
Yes. There’s no question on that one. Your pitch deck captures the rationale for why investors should fund you. It also serves as a “leave behind” and something that can be reviewed by a group of investors if you’re going that route.
Is a pitch deck the same thing as a business plan?
No. While there are overlapping elements between an investment pitch deck and a business plan, a pitch deck is a brief prospectus that covers the key elements about problem, solution, market, team, etc. Business plans are far more detailed laying out specific plans about how you’re going to build your business. I have yet to read a compelling one.
Do I really need to do a presentation?
Yes.
How has Covid-19 changed startup pitching?
The pandemic moved business online, including many aspects of fundraising. Initial coffee meetings with investors, leading to in-person pitch presentations have shifted to email outreach and online presentations.
This changes the dynamic of how you build and present information to investors to maximize your time and increase your odds of fundraising. The strategy we’ve been telling early stage companies to adopt is to have 3 basic versions of your deck:
5-6 slide teaser deck that you feel comfortable sending in a cold email.
10-12 slide deck that caters specifically to the investor you’re chatting with after an initial hit from your teaser deck.
25-40 slide deck that is #2 with an appendix covering the details that you can review in a partner meeting or share with an investor to share internally. This is a great place to start when you’re entering into due diligence.
Three decks sounds like a lot of work, but it’s really not. If you get your story right early on, the 10-12 slide deck becomes the basis for the teaser and longer presentation.
What should my pitch deck include?
At a minimum, most decks include:
Company Purpose (Title slide with tagline / 1 sentence elevator pitch)
The Problem
The Solution (and demo)
The Market
The Competition
Traction
The Business & Revenue Model
The Team
The Financials
Ask & Use of Funds
What order should my slides be in?
While the list above presents a typical presentation flow, the order should highlight the most compelling part of your story early on.
How long should my pitch deck be?
Shorter is always better! Having an Appendix allows you to store additional slides in case you need them.
Should I ask investors for an NDA? How do I share confidential information?
No. Don’t ask for an NDA. No investor will ever sign one and you’ll look a little silly asking. The reality is your idea is probably fantastic, but it’s highly likely that someone else has had it before or is currently working on it. Ideas are like the tip of the iceberg; execution is what’s below the surface and is the most important part.
What makes a great investment pitch deck?
A succinct, compelling story that pulls the reader in and has them wanting to know more. Reading a pitch deck should feel like understanding a problem you cannot believe doesn’t have a solution yet. The best decks have data and proof points to back up the narrative.
Where do pitch decks go wrong?
Pitch decks go wrong when they get off task, get too wordy, don’t address the key bullet points and don’t have a narrative. 3 minutes tops.
How do I get help?
Don’t be shy about asking us. We always offer a free 30 minute pitch review.
What about these investment summaries or funding proposals that I’ve been hearing about?
If you live in the Bay Area or have been through an accelerator like YC or Techstars, you can likely get away with an investment summary or funding proposal.
Even if this is the case, creating a pitch presentation forces you to think through a clear, holistic story about your product, the market and the investment opportunity.
What do you recommend for pitch deck design tools?
Design matters! Your pitch deck represents your company. It is worth investing in both the story you are telling and the visual design.
Consider hiring a freelancer to improve upon the visual design or check out design tools such as Canva, Slidebean, Beautiful.ai or Pitch.
What’s next?
This is part of the Fractionalist Fundraising Series for Early Stage Founders. We always appreciate feedback on the series and we're always here to help you with your fundraising efforts.
Fractionalist helps early stage companies navigate the challenges new companies inevitably face with a team of experienced CxOs you can leverage at a fraction of the cost.