What makes a startup’s pitch deck stand out to investors?
What makes a pitch deck stand out?
Over my career helping startups raise funding I have looked at more pitch decks then I can count. Most of them have been average at best. It isn’t that a pitch deck itself needs to be fancy. In fact, like many things in business and life, I think it is important to just focus on the basics. You don’t need a lot of flashy art or PowerPoint SmartArt. Simple bullet points work just fine. The designers usually get so focused on those things that they fail to be able to tell the story of the startup and how the idea is unique in a concise and engaging way.
Don’t believe me? Even some of the most recognizable startups that have now reached unicorn status (i.e. are valued at over $1B) used a very simple pitch deck. For some well-known examples head here.
Beyond a simple and concise deck, let’s take a look at some other ways to make a pitch deck stand out.
It tells a relatable story
A pitch deck is simply another piece of collateral for your business. The difference is that a deck is targeting investors instead of customers. Just like any other piece of collateral you should always try to tell a story with your marketing efforts. Not only should you tell the story of your startup, such as how it came to be, but you should also tell a story about the pain point you are solving. It is critical that part of your story be as relatable as possible.
You don’t need every investor to have experienced that pain point. You just need them to be able to sympathize with it and recognize that a solution to it would make the world a better place.
Projections that make sense
I’ll admit that some people just don’t have the aptitude for financial matters. I am a financial type. So, when I look at a deck I focus on the numbers. Investors do the same thing. The reason is that they are trying to decide if your financials make sense and if you can achieve the level of sales and profit that you project.
If you aren’t sharp with numbers then I recommend having someone work on your projections with you. I can’t tell you how common it is for me to review a startup’s projections only to find massive holes in their logic.
Sometimes they miss important expenses outright. Other times they are so conservative with their projections that they aren’t able to show the kind of return on investment that an investor will be wanting. Or, on the flip side, they are so aggressive with their projections that the numbers are completely unbelievable.
An ask that makes sense
If you have ever watched Shark Tank then you have most likely witnessed a founder who has come up with some ludicrous valuation for their company. It usually goes something like the following.
Founder — “I’m asking for $100,000 in exchange for 1% of my company” (Which is a $10M valuation)
Shark — “Ok. What were your sales last year? What are your sales this year?”
Founder — “This is the first year we have had sales. So far we have made $23,000.”
Now, I might be stretching the truth a little bit here. But, honestly not that much.
If you want your pitch deck to stand out, to capture the attention of an investor, you are going to need to have an ask that is reasonable. That means having an ask that you can support with facts and numbers.
There are a few ways to do that. You could base your valuation on historical valuations of similar companies at a similar stage in their startup lifecycle. You could base your valuation of revenue methods such as discounted cash-flows.
The point is to base it on something you can support. Not some random number you pull out of the thin air.