Whether they’re pitching to VCs or angel investors, here are five ways entrepreneurs can quickly make an impression.
For entrepreneurs looking to pitch investors and take their startup to the next level, creating a compelling pitch deck is a must. It's what gets founders to hopefully meet with investors and begin a conversation about securing funds. But with venture capitalists (VCS) and angel investors seeing hundreds of pitch decks each year, entrepreneurs must quickly make an impression to stand out from the crowd.
“A pitch deck is your calling card,” Rana Abdel Latif, Senior Principal at VC firm Nclude, tells StartupScene. “It’s what gives that first impression, and usually the first impression is the lasting one.”
That’s why a successful pitch deck needs to attract investors’ interest from the start, and tell the business story in a concise and intriguing way. It can make the difference between a failed pitch, and one that lands funding. Here are five tips to build a winning pitch deck:
A successful pitch deck needs to be short, straight to the point, yet packed with valuable information.
“Less is more so to speak, and being concise and straight to the point is definitely more of an advantage,” says Eyad Albayouk, General Manager at Flat6Labs, Saudi Arabia. “It’s good to keep in mind that investors are probably bombarded with these documents, and they’ve probably seen multiple iterations of the same idea, or the solution addressing the same problem. So, the more efficient the communication is, and the more captivating, hopefully the better outcome will be for that startup and the founding team.”
According to Elbayouk, the deck needs to include several basic pieces of information, including a problem statement, which needs to have mass appeal, and a solution that genuinely addresses the problem at a large scale. Providing market insights, understanding the competition, and showing growth prospects is also critical in demonstrating deep understanding of the business landscape, helping gain investor confidence not only in the business, but also in the founding team as well.
HAVE AN A TEAM
For young startups, particularly those looking to raise a pre-seed, seed or a series A round, investors usually pay special attention to the team, as they ultimately will be responsible for the company’s success or failure.
Bilal Al Souaied, COO at Cytomate, a cybersecurity startup based in Qatar, has been on both sides of the table— an investor and startup team member. “I look to invest in the team,” he says. “The team has the ability to pivot the company when it’s needed, to address the challenges in a rapid market environment, and to do all what is necessary to keep the company surviving.”
This especially rings true in today’s macroeconomic challenges where capital is becoming harder to come by, and geopolitical tensions are disrupting some markets and sectors in the region. Founders therefore need to think on their feet and act swiftly to mitigate challenges as they arise to keep their startup afloat.
TELL A STORY
Perhaps one of the best ways to engage investors early on is by simply telling a story. While this may not be possible in a pitch deck sent over by email, it certainly is desirable if entrepreneurs are presenting it in front of an audience.
“The pitch deck is like story telling,” Ihab Tabbara, startup mentor in Saudi Arabia, says. “You only get one chance and one chance only to attract investors’ attention with your pitch. It’s like when opening a book. If you open the first page and you don’t like it, you put it back.”
He suggests that founders should talk about why they came up with their business idea. What struggles did they face? What challenges did they experience in the market? “That’s how you grab their attention,” he adds. “Once you have the opening line, then you tackle the pain problem. Where is the gap in the market? What is the solution, and how are you going to solve it? You need to also discuss the revenue model, the competitive landscape, and showcase the team.”
SHOW FUNDAMENTAL KPI’S
When trying to lure investors in, it can be tempting to inflate figures like valuations, market size, and forecasted growth. But today, investors are looking for fundamental KPI’s to determine a startup’s viability both in the short and long term.
“I think definitely founders and investors alike are less tolerant of vanity metrics,” adds Albayouk from F6L. “There is more value being placed on fundamental metrics that translate into real cash contribution to the business, and its ability to continue operations.”
Some of the fundamental metrics Albayouk refers to include sales, net income, gross profit, and unit economics. “There is definitely more control there from the founding team, that essentially is what an investor will be looking at, rather than how the markets will behave in 12, 24, 34 or 48 months, which is beyond any individual’s control.”
STATE CALL TO ACTION
Finally, a pitch deck wouldn’t be complete without a call to action. The call to action should be clear and concise, and states the action you want your audience to take.
While most founders are looking to attract investments with their pitch deck, some simply want to expand their network, have their audience sign up for a trial version, or download their app. “It’s nice to have an ask, even if you’re not looking for money right now,” says Abdel Latif from Nclude. “But what is your ask right now, specifically as a startup? Are you looking to fundraise? Are you looking to build relationships? Or are you looking for M&A opportunities?”
If a startup is looking to fundraise, it’s important to be clear on the exact funding amount and mention exactly what it will be used for. This will help determine realistic milestones in the short, medium and long term.
After all is said and done, it’s worth remembering that a pitch deck is only a small part of a startup’s journey. It can help founders get their foot through the door, but it will not immediately result in investments. Afterall, fundraising is a long and lengthy process. “I think founders will do themselves a huge favor knowing that patience and grit are really the name of the game,” Albayouk says.
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