[Copied from Business Insider, Original: https://www.businessinsider.com/entrepreneurship-guide-create-pitch-deck-startup-2019-4]
How to build a pitch deck that will wow investors, featuring a slide-by-slide breakdown of the decks a founder used to raise $448 million
Feb 18, 2021, 3:00 PM
Keep your pitch deck simple, and include the information that’s most relevant to each investor.
Pitching your startup to investors can feel like a performance. Entrepreneurs and investors say, keep it simple; tell a story in 10 slides or less.Tailor your pitch to your audience and demonstrate why now is the best time to launch your business.Visit BI Prime for more stories.
They tell you not to judge a book by its cover — but investors will absolutely be using your pitch deck to evaluate your company's potential, so you'll want to make a stellar impression.
To that end, we asked a series of successful entrepreneurs and investors for their best advice on creating an impressive pitch deck:
- Justin McLeod, the founder and CEO of Hinge, a dating app.
- Kim Taylor, the founder and CEO of Cluster, which recruits for advanced manufacturing roles.
- Christina Carbonell and Galyn Bernard, the cofounders of Primary, a children's clothing brand.
- Megan O'Connor, the cofounder of Clark, a tutoring-software company that was acquired by edtech startup Noodle.
- Jen Rubio, the cofounder, president, and chief brand officer of Away, a travel brand; Steph Korey was the CEO until 2019.
- Masha Drokova, the founder and general partner of Day One Ventures, an early-stage capital firm.
- Anu Duggal, the founding partner at Female Founders Fund, which invests in early-stage technology companies run by women.
- Andrew Parker, the founder and CEO of Papa, an elder care startup.
- Russ Heddleston, the cofounder and CEO of secure document sharing platform DocSend, which has studied thousands of pitch decks sent to investors through its platform.
Their main takeaways? Keep it simple, and include the information that's most relevant to each investor.
At the bottom of this article, you'll also find the recording of a webinar in which Henry Ward, the CEO of billion-dollar startup Carta, walks us through his Series A and Series E pitch decks. Carta has so far raised a total of $448 million.
Read on for a practical guide to pitch decks, a breakdown of some impressive examples, and some tools to get you started making your own.
Customize your deck to the specific investor you're pitching
You might envision walking into a room full of investors, requesting $1 million for your company, and walking out a few minutes later, triumphant.
That's not typically how things work.
McLeod said it's more common (and more effective) to form a relationship with the investor before making your pitch. That includes asking the investor what kind of information they want to see in a deck and which numbers are important to them.
Prepare multiple documents that tell your company's story
Taylor recommended creating three different versions of your pitch deck. Specifically, you'll need a short advance copy, one for in-person meetings, and another for follow-up calls.
Verify investors before sending them confidential information
Taylor warned founders not to include financial information in their intro deck and "blindly send it to people without qualifying them." She recommended DocSend for this purpose.
Cluster's title slide.
Make sure to visually represent your brand identity
Ideally, by the time you're putting together a deck, "you have enough of a vision for the brand that you're building" that you can visually represent that brand, Carbonell said. Too often she sees other founders' decks "either not well designed or generically designed," and missing their "brand personality," she said.
Taylor reminded founders to design their title slide and not to leave it as an afterthought.
"First impressions matter!" she said.
Don't go overboard with the information you present
Keep your pitch deck concise.
A few entrepreneurs mentioned that they'd used the venture-capital firm Sequoia Capital's pitch-deck template, which includes 10 slides, each with one key point.
And Taylor said she uses Guy Kawasaki's 10/20/30 rule: "A pitch should have 10 slides, last no more than 20 minutes, and contain no font smaller than 30 points."
Heddleston said the biggest mistake founders make in their decks is being insecure. Founders worried about coming off as unqualified will add extra details and technical language that obscures their points.
Heddleston personally reviews decks to decide whether to send them on to venture capital contacts, and frequently declines to because of their perplexing language.
"It's like, I don't know what you do," Heddleston said. "I'm not going to take the meeting. I don't understand why blockchain is involved with the dog walking marketplace. That doesn't make any sense to me."
Remember that your deck should tell a story
Your deck should outline the most important points about your business — not everything about your business.
As Bernard put it, your deck should "tell a story" so that investors "can understand where you think the business is going to go."
It goes back to knowing which numbers and metrics matter most to each investor. "If you throw all of your numbers into your deck, it may not tell a story," Bernard said, and the investors "may not latch on to the right point."
Rubio said founders should "paint a specific picture of the one (or maybe two!) biggest opportunities that you're working to leverage, and then focus your pitch on how you're going to approach them."
"Otherwise, it's too easy to give the impression that you're not clear on your purpose and the value you're uniquely bringing to the table."
DocSend analyzed thousands of decks sent to investors through its platform over the years to find the most common order successful decks and created this recommended order:
- Company purpose: Why does your company exist? Some startups put this in their title slide.
- Problem: What is the problem your startup addresses?
- Why now: Explain to investors why right now is the right time to invest in your company.
- Solution: Explain how your company solves the problem.
- Market size: Clearly define the market you're entering and how large it is.
- Product: Say what you're making. Make sure everything in this section ties back to how you're solving the problem.
- Traction: Provide evidence that your idea can succeed.
- Competition: Say who your competitors are and what makes you different. This section should be simple.
- Team: Explain why your team's expertise helps the company.
- Business model: As simply as you can, explain how your product will make money.
- Financials: Not every company includes this section. If you do, include cash flow or profit and loss information.
- Fundraising Ask: Say how much you're looking to raise, how much you've already raised, and how you will (probably) spend it.
Pretend you're creating a deck for your parents
Carbonell said one of the best pieces of advice she'd heard on this topic is to pretend you're presenting the deck to your parents.
In other words, don't be afraid to "brag a little bit" — your parents want you to succeed — and "give them a little bit of context for some things," since they might not be experts in the space like you are.
Carbonell said this mindset had helped her spot any holes in the Primary pitch deck.
Include just one point per slide
When you're creating a deck to use during in-person meetings, avoid the temptation to cram every slide with information.
"Each slide should have one cohesive, clear point, and it should not take a lot of text to make that point," O'Connor said.
Remember you'll be talking during the presentation, she said, "so you don't need everything you're going to say also on the slide."
DocSend found that successful pitch decks sent in advance to investors often didn't use more than 50 words per slide. The only exception to this was the slide showing who works at the startup, which tended to hit 80 or more words.
Clark's slide on the team.
Use one slide to explain who's on the team
"In the early stages, a VC is investing in the person (or team), not the company," O'Connor said. "They have to believe that you are the one that can accomplish the mission above anyone else."
That's why she recommends including a blurb on the entire team and their professional backgrounds. During the pitch, you can talk through your story as the founder.
Include your bio if it's relevant
Taylor said that "people remember narrative and why you are doing something." If your personal or professional background is relevant to the company, include that in your deck.
For example, Taylor grew up in an advanced-manufacturing hub in Wisconsin, so she includes that point when she's pitching Cluster.
Show the problem and your solution
Parker started his pitch deck by presenting investors with the specific problems Papa is aiming to solve. Parker used relevant data and market costs when framing the issues to show the business opportunities for Papa. For instance, there are 50 million US seniors and social isolation costs the country $70 billion per year, his deck notes.
"There's a cost associated with loneliness and isolation," Parker said. "In a one-second view, you can see this is big and costs money."
He continued the presentation by explaining how Papa plans to tackle those problems in a clear step-by-step process.
Don't forget to say what your company is actually doing
Yes, it sounds obvious. But the Primary founders said it's easy to get so deep in the weeds that you forget to tell investors what the purpose of your company is.
"Occasionally, we are so close to what we're doing, what our actual product is and what we're offering, that we forget to say it," Bernard said.
Outline both your grand vision and your concrete execution
Your pitch deck should address two points, McLeod said: "Here's the grand vision of where this is going to go and why this is a big idea" and "We're going to really nail this one narrow thing really well."
When McLeod was pitching Hinge, he emphasized the global vision of changing dating culture. But he also showed that he had gotten people using the app in the first place.
A slide from Brex's pitch deck on market size.
Address the market landscape and competition
Duggal said one common mistake she sees in pitch decks is "not addressing competition or figuring out the market landscape."
"When we think about investing in a company, we want to understand — that's great that you have an interesting idea or you spotted something that has the potential to be an exciting business — but we also want to understand what is already in the market," she said.
A slide from Day One Ventures' pitch deck on "why now?"
Day One Ventures
Explain why now is the best time to launch your business
Don't just talk about the problem and your solution, Carbonell said. Also answer the question "Why now?"
"It can be very helpful in persuading an investor not only that you have a good idea, but why now is the right time to pursue it and why it hasn't been done before," she added.
Drokova said: "A deck is all about why [the business] should exist today and that you're ready and capable to execute it. With Day One Ventures, it was about our insights into communications and PR, and seeing how much it helps early-stage companies grow in size and valuation, and how it assists with recruiting top talent."
Highlight the cost of customer acquisition
O'Connor said investors are always interested in hearing about your cost to acquire a customer. "At the very least," she said, "you need to be able to show that your CAC will decrease over time, and what your plan is for making that possible at scale."
Include whatever data you can to inspire confidence
Early on, Korey said, "you might not have enough data to successfully show anticipated traction." In that case, "focus on other metrics that you can share," including qualitative feedback from your initial research.
"When the hard data doesn't exist yet, there are other ways to prove that there's an appetite for what you're building and a path toward success," Korey said.
A slide from Front's pitch deck on how capital will be used.
Specify how you're going to spend the money you raise
Investors want to know what you'll be doing with their cash.
"You need to be more specific than just letting the investors know you're going to build the company and should be able to speak to things like headcount, office space, vendor agreements, R&D, and any other big expenditures for your business," O'Connor said.
Highlight your plans for growth
Duggal said every deck should include a five-year growth plan.
A slide from Carta's pitch deck on the payback period.
Tell investors how long it will take to get their money back
The "payback period" is how long it will take for investors to recover the cost of their investment.
"Investors are going to give your company money because they believe they can eventually make a profit off of it," O'Connor said. "So in addition to clearly articulating how that will be possible, you'll also need to share a specific timeline of when it's going to happen."
Tweak the deck based on the feedback you get from each investor
When the Primary founders started pitching investors, they realized they needed to make their deck even simpler.
"Not all of the points that we were making were coming across as clearly as we wanted to," Carbonell said. So they updated the slides for the rest of their investor meetings.
Use the tools you have, or find help here
There are a lot of tools available to create winning presentations, and depending on your team's design skills, many services out there to make your deck shine.
Most businesses have access to basic software like Google Sheets, Power Point, and Apple Keynote, but here are 5 online services that go further.
Each are free or offer a free trial, and some provide options for design and technical support. In order of least expensive to most for a premium annual subscription:
- Pitch Deck Analyzer from DocSend (free) — DocSend will compare your pitch deck with its data on what what makes decks successful to come up with recommendations on how you can improve.
- Slidebean ($96/yr to $228/yr) — Slidebean uses artificial intelligence to automatically populate slides with your content.
- Canva ($120/yr to $360/yr) — Canva provides a full suite of tools for creating brand and marketing materials.
- Haiku Deck ($120/yr to $360/yr) — Haiku Deck has thousands of templates for presenting on any connected device.
- Pitch Deck ($199/yr) — Pitch Deck is a platform that enables teams to track the performance of individual presentations.
- Prezi ($240/yr to $720/yr) — Prezi is a dynamic canvas software that is more like a whiteboard than a slideshow.
Whichever option you choose, you'll want to make sure you can easily update your content and run the presentation smoothly, including jumping between slides, without too much fumbling around.