The pitch that no VC can resist
Startups require capital to be able to develop their business plan, grow and be successful. An essential element for raising capital is the investor’s presentation, commonly known as the investor deck or pitch deck, it is most relevant sales material of the startup. Remember that investors, such as venture capital funds (VC) or corporate venture capital funds (CVCs), take less than 4 minutes to review them and make the decision whether to move forward or not in the investment process.
Companies like Facebook, Uber or AirBnB have prepared presentations of this type to raise capital. The most important features in this kind of presentation are: relevant content, easy for the reader to understand and visually appealing. After examining thousands of presentations, we recommend the following to make yours successful in content and structure.
1. Company overview
It is recommended that you include the name, logo, address of the company, a brief review of the product or service that shows how it solves the problem, as well as the competitive advantage and the traction (if any) of the company.
It is the most valuable selling point of the project, especially in the early stages. It is desirable that the presentation includes the names of the founding team, previous experience, academic history and any previous (professional) relationship that may exist between them. The investor will try to understand why they are the best team to solve the problem and why they should give you the money. As a suggestion, always include the LinkedIn of the founders and details of the board of directors or advisory board, as well as the total number of people currently working in the company.
Having problems to solve today is a fundamental element for a relevant value proposition. For example, Uber detected the need to solve the problem of people’s mobility through a network of drivers. The cost-benefit of developing a solution for this was attractive and the result is a global company with high capitalization in the stock market. It poses the problem in a simple way and with a focus on the solution and value for the user.
Describe the solution to the problem and indicate why its development is valuable. Include who benefits from the solution and which customer segment you will be targeting. For example, Square originally solved the problem of users card payments by benefiting stores or service providers who are the acquirers of this technology and who could not access a bank payment terminal.
5. Product | Service
Make a brief description of your product or service including its main characteristics, the current development stage (eg. Minimum Viable Product “MVP”, Beta, operational, etc.) and a use case. For example, a project in the development of a medicine could be different than a health-tech solution.
6. Business model
Be sure to explain it concisely and clearly including its characteristics, such as the revenue generation mechanism (eg. price per unit, service fee, license, cost plus margin, royalties, among others) and the pricing strategy per distribution channel, client or geography.
Include the attributes of your clients mentioning current clients and those in the acquisition process. In addition, it defines the mechanism and channel by which you are acquiring them, as well as their cost. Another relevant factor is your customer retention rate and turnover.
Sometimes it is one of the areas that entrepreneurs do not show or to which they pay less attention. However, having a clear concept of your technological development, the technological plan and the stage you are in is essential. It is also important to understand the intellectual property of this development, as well as patents, licenses and copyrights.
According to the capitalization round you are in, the investor will try to identify different elements of traction to see if you have reached an alignment between the product and what the market requires (Product Market Fit “PMF”). This should be shown with relevant metrics such as the unit economics of the company (eg. customer acquisition cost “CAC”, customer lifetime value “CLTV”), sales (monthly or annual recurring revenues “MRR or ARR”), profitability, among others.
It is also desirable to indicate if you have associations, strategic or commercial alliances for the development of your business.
Identify and show the market size considering the total size, the size you can reach (Total Addressable Market — TAM) and the initial market size. In addition, you must include the geographies where you operate to date or where you want to expand.
Define who your current competitors are and point out the differences why the company is better than them. Also identify potential competitors, market trends and the context of the industry and / or country where you operate or expect to operate.
12. Strategy and growth plan
It is your opportunity to show the investor your action plan to become that company in which everyone would like to invest. You must answer where you want to go, what you want to do, how, when and where you want to do it.
It displays a summary of your current financial results and projections making sure that the latter are realistic and informed. It also details how much money the company is spending monthly, the liquidity it has under current business conditions and point out when the company will reach break-even or if it has already reached it.
14. Use of funds
This slide is where you explain how much money you are raising in the current round and what will be the use of proceeds. In addition, it is recommended to include some of your current relevant investors.
It is the part where you can include all the supporting materials of your presentation trying to anticipate all the questions that they might ask you. Generally, you have this section with you when it is the face-to-face meeting with the investor. Here there is no limit of slides, add as many as you feel comfortable for the dialogue with the investor.
-The creation of this presentation is a practical exercise for you to understand your strengths, weaknesses and define strategies that you can execute to achieve the objectives of your company.
-Focus on the content, write short sentences and support the information with hard data and facts.
-Pay special attention in the design of the presentation considering who your audience will be. Standardize typography and validate colors according to color psychology.
-You never know who will see your presentation, so always put your contact information (eg. name, email, LinkedIn and website)preferably in the last slide.
The Investor Presentation is one of the most important elements you have when you go out to raise capital. You can also create other resources such as a one-pager or a teaser. If you don’t know the investor, perhaps a better option is to send the latter as an initial introduction.
Remember that the stage your company is at and the type of survey you do influence the content and structure of the presentation. Generally, Series A investor decks are longer and have at least three times more statistics than in earlier stages.
The presentation is your chance to tell a solid story with content and data and convince investors to invest in you!
“Chase the vision, not the money; the money will end up following you.” –Tony Hsieh, Zappos CEO
-Google’s Template Pitch Deck for Startups https://docs.google.com/presentation/d/17wRgJpjHIyhtgglmn31CPL_O9h2oEdy80uodjd5iaQE/edit#slide=id.p
-Sequoia Pitch Deck template
-Mint.com Pre-Launch Investor Pitch Deck
-Facebook’s Original Pitch Deck
-Airbnb’s Pitch Deck for Its Angel Round
-Uber Pitch Deck for Its Angel Round
-AirBnB Pitch Deck for Its Seed Round
-Revolut Pitch Deck for Its Seed Round
-Square Pitch Deck for Its Series A
-LinkedIn’s Pitch Deck for Its Series B Round
-Monzo Pitch Deck for Its Series C
Hector Shibata. Director of Investments & Portfolio at ACV a global Corporate Venture Capital (CVC) fund.
Ricardo Latournerie. Investment analyst at ACV.
ACV is an international Corporate Venture Capital (CVC) fund investing globally in Startups & VC funds.
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