6 elements of a winning pitch deck
As entrepreneurs, we’re big fans of Dragon’s Den, Shark Tank, The Pitch and every other showcased opportunity for dreamers to present their ideas to people with money. And while we get to see their spiels, we never get to see the pitch decks. And it’s too bad because without a good pitch deck, they’re not getting any money.
We think it would be interesting for all budding entrepreneurs to see how others articulate their thoughts. What works? What doesn’t?
We’ve put a lot of pitch decks together for a lot of clients. Most were successful. Some weren’t. But when it came time to submit, the pitch decks all had these six things in common:
- A table of contents
It seems like an afterthought, but it’s actually critical. Think of your pitch deck’s table of contents like a primer for your potential investor. It sets them up for what they’re about to read, and it pre-organizes their mind. You’re telling them “I’m going to talk about this, then this, then that.” And if you can keep it short (more on that later), you’ll increase the chances that an investor will read it. No one wants to read a 30-page deck.
TIP: Use the table of contents language to establish positivity. You might have a page that details the business problem. And you can absolutely call it the “business problem.” But you can also call it the “opportunity.”
- A demonstrated understanding of the space you want to be in
If you’re at the point of standing in front of investors, you’d need some kind of balls to not have invested a ton of time to attain expert-level knowledge of the industry, the market, the audience, the competition and the trends. This needs to be in your pitch deck because it instils confidence that there’s a need for your idea and, therefore, a reason to fund it.
TIP: Pick six to eight stats that tell the story and put them on one slide. Then include the rest as an appendix. And when we say tell the story, actually think of the stats as story-telling: beginning (this idea doesn’t exist ¾ and closest competitor is XXX); middle (XX% of people report that they would use this product); and ending (we can expect to convert XX% of the market in year one).
- A competitive advantage
Something has to make your idea different or no investor will have a reason to fund it. And that point of difference has to be clearly stated in your pitch deck, as close to the front as possible. Again, if you’re at the point where you’re in front of investors, you should know what makes you special.
TIP: Think of your competitive advantage as an “unfair advantage.” It’s what should be keeping your competition up at night with cold sweats. And when you articulate it, it should induce those cold sweats. Consider “our competitive advantage is the way we make our silk” versus “our competitive advantage is the proprietary silk production process. It turns 3,000 years of silk production on its head, making it infinitely cheaper and faster.”
- An exit strategy
Here’s the thing about investors: eventually they want their money back and then some. And they’ll want to know how that’s going to happen. In other words, what company is going to value your company at 100 times what you’re asking your investor to currently value it at? Now, obviously, a lot of things have to go right for this to happen, but investors want to know that you’ve thought about this and can make a legit case.
TIP: Be specific. If you think a telecom will eventually buy your company, indicate which telecom and why. In Canada, if you’re an entertainment property, you’re much more likely to get bought out by Bell. If you’re a technology company, you’re much more likely to get bought out by Rogers. As a founder, you need to know this, because a savvy investor will.
- Team bios
Yes, investors buy into ideas and companies. But they’re really buying into people. Without confidence in the human beings being the concepts, it doesn’t matter what the concepts are.
TIP: Keep bios short and on-point. Investors don’t need to know where you went to high school (unless you’re still in high school). But they might want to know what your passion has been since you were a kid.
- A clear offer
What are you asking for, what is your investor getting and what will you be doing with their money? There’s no room for conjecture here, and definitely no room for wishy-washiness.
TIP: Give a high-level expenditure plan in the deck, supported by a full financial plan as an appendix. The more specific you are, the more confidence you’ll create.
Last word about pitch decks
Investors receive hundreds or thousands of pitch decks a year. They have no patience for loquaciousness and no desire to read through a novel. If your idea is solid, it won’t need a lot of verbiage.
Tip: Approach your pitch deck like you’d approach an elevator pitch. If this document was in a person’s hands for 30 seconds, what will it take to get them to the offer?
Not sure? Let’s talk about your pitch deck.