If you're reading this, chances are you're considering taking a big step in your entrepreneurial journey—bringing in outside capital for your business venture. Nervous? Don't be. You are likely in a fortunate position: Either your idea is so visionary that you have an exciting reason to get in front of investors, or your business is humming along and you are poised to accelerate growth.
If you think you're ready to reach out to prospective investors, the below tips can help create a winning pitch deck.
1. Know your audience.
Venture capitalists are different than bankers who are different than private-equity investors. Generally speaking, venture capitalists want to see vision, bankers want to see existing cash flow and private-equity investors want to see that there are opportunities to improve efficiency. If you don't know your audience, get to know them. Try finding other entrepreneurs who have successfully pitched to your investor audience before to give you guidance. Even better, see if you can get an introduction to the investors you seek. A warm hand-off can be much more effective than a cold call.
2. Keep it short and simple.
It is highly likely that you are one of many investments under consideration. The way to think about this first meeting is like a TV commercial. You need to grab your audience's attention fast (before they change the channel) and keep them engaged throughout your presentation. One rule of thumb is to try keeping your first pitch to 20 minutes. Additionally, focus on one point per slide, and spend about two minutes covering each point (per the 10/20/30 rule for presenting from Guy Kawasaki, a well-known venture capitalist).
3. Look professional.
Unless you moonlight as a professional graphic designer, you may want to invest in working with a designer who has experience designing killer pitch decks. You can hire one, or you can take advantage of free PowerPoint and keynote pitch deck templates which also provide guidance on how to shape your story.
4. Put pertinent information up front.
Don't make an investor wait five or six slides to get to the meat of it. Put your value proposition front and center. This is the one-sentence takeaway that investors should remember when you leave the room. Your value proposition should clearly communicate the problem you are solving and the solution you are providing. Follow that with key numbers and traction. This grabs attention and clarifies the investment opportunity for your audience, especially if the numbers are good.
5. Follow up with solid support.
Depending on your business, you may want to include some or all of the following:
- Details on how many people have the problem you are solving and how much they are currently spending to solve it
- How you plan to make money
- What proprietary technology or expertise you bring to the table
- Who you are competing with and what sets you apart from them
- Your team
- Your financials
- The funding you are looking to secure and what it will deliver
6. Be you.
The funny thing about pitch presentations is that even if the vision is compelling, the numbers look great and the business idea is sound, it needs to come from you. Investors don't invest in businesses, and they don't invest in pitch decks. They invest in people. Bringing in investors is like getting married. Yes, you want to show your best self. But you want to be honest with how you are running your business and how you see investors fitting in so everyone has a very good idea what they are getting into. There are many entrepreneurs who will tell you that money from investors with whom you do not see eye-to-eye can be worse than no money at all.