Creating a pitch deck is not an easy task. You must be clear about every word and detail you include in your deck.
Investors are likely to ask a handful of questions about you, your company, your team, why you are looking for money, and many more questions you need to have a clear answer to.
Therefore, the process of creating a pitch deck begins way before you have even opened PowerPoint or Keynote. It starts with a set of simple questions you should find an answer to; why do I need a funding round? What will I be spending the money on? Am I looking for an investor that gives me money, or do I need an investor that can accelerate my growth by connecting me with other companies from his network?
With this article, I want to give you a brief overview of things you should have done before you even start creating your pitch deck.
This is why you should start thinking like an investor
I have written a full blog post on this last week, but I can't emphasize this enough. If you do not start thinking like an investor, you will not be able to convince investors to invest in your start-up.
You have to understand why investors are willing to invest in your business: They see you/your company as a chance to increase their capital.
It is that simple! Investors will give you money, you will go and work with it, and after a couple of years, they hope to sell the assets they got in return for their investment with a multiple of 4x or more.
Creating a pitch deck without this knowledge often leads to just presenting your team, the problem you solve, and how big your market is.
Now being aware of the investors' purpose, you will be able to create a pitch deck that gives investors the confidence that you are the right entrepreneur who is going to increase their capital by working hard, having the right vision and strategy to reach the companies goals.
Why you should know precisely how much money you need
We have seen many pitch decks in the past couple of years, and after reading most of them, we were still wondering what the money they want to raise is going to be used for.
Imagine you are an investor and read 5 pitch decks a day. At some point, you read a deck of an unknown startup that is asking for $600k, and they barely give you any information about what they are going to do with your money. Would you consider investing in the startup? Remember, you have worked hard for your $600k surplus. I guess the answer would be "no," and you would go on reading another deck where you might find better information.
So, what do you need to do now is thinking about the following points:
- Analyze where your revenue (if you already have any) comes from
- What are the next steps to increase that revenue?
- Have you already discovered marketing channels that work for you? How much more money can you spend on these channels before the CPA is too high.
- Do you need more employees for your business to grow? What type of employees do you need and how much will they cost you over the next two years?
Go a little into detail about what the employees are going to work on. Simply saying, "they will do marketing" is not enough. Will they work on social media marketing? Offline marketing? Content marketing? If you have not enough space in your presentation deck, make sure to add this information during your presentation verbally.
Okay, it would help if you had new employees. Is there enough workspace in your office right now, or do you need to move to another office, which will cost you more money?
Do you need technical equipment for your new employees?
How long does it take since your new employees will generate revenue for your company? Most entrepreneurs underestimate the amount of time it takes since a new employee is generating more revenue than he/she costs you!
Are you going to trade goods? If yes, give a little detail about how much money you will spend on buying products and how much money you will generate by reselling them.
Here are some minor costs you should consider in your financial plannings:
- IT-related costs (server, saas.. etc.)
- Bank charges
- Legal fees
- Travel expenses
- R&D costs
How much money do you want to spend on the creation of the pitch deck
Creating a pitch deck can be a costly thing. If you hire a freelancer or professional company who is designing the pitch deck for you can cost you much money.
The best thing to do now is to think which of these three factors is essential for you to:
- Price
- Time
- Effectiveness
Over the last couple of years, we have created hundreds of pitch decks for enthusiastic entrepreneurs. However, when it comes to telling these entrepreneurs the price of the design service, most of them were shocked. They forgot that each pitch deck is unique and handmade, that a professional designer costs more than $30 per hour, and even if your order a pitch deck, you still have to put much work into writing the content.
However, for most entrepreneurs, the "price"-factor is the most important and most sensitive.
Unusually, a fresh startup cannot afford a design service. Due to this, we recommend entrepreneurs to use pitch deck templates.
Using a pitch deck template brings lots of advantages.
- Since it is available for a broader spectrum of entrepreneurs, the price of a pitch deck template is low.
- You can customize your pitch deck with hundreds of different elements from the pitch deck template
- Most templates have cross-industrial design elements that fit your startup
- The design of a pitch deck template is always up-to-date when you buy it
- A pitch deck template is continuously evolving through incorporated customer feedback
We have created a deck template for price sensitive entrepreneurs that includes high quality slides, mockups, graphs, pictures and design proposals.
Make a list of potential investors
Having a list of potential investors will save you a lot of time and frustration. Your goal is to create a list of targeted potential investors you are going to send the pitch deck to. With this list, your odds of finding the right investor are high, and the amount of "no's" you must deal with will be far fewer than there would be by merely writing every investor you find on google.
If you are wondering how you can find potential investors, this shortlist could be your starting point:
- Friends & Family
- Local Business Angel
- Business Angel networks
- Venture capital investors
- CEOs of Local businesses
You now might be thinking: "how can I even get the E-Mail address of these people?" This is not as difficult as you might think. Today it is way easier to get the E-Mail address of an investor than it was 15 years ago.
Create company accounts on the following social media platforms: LinkedIn, AngelList, Crunchbase, and Xing. All these platforms have a search bar you can use.
As an example, you can search for the keyword "business angel" on LinkedIn. The first results you get are people that labeled themselves as "business angel." You can start looking at their profiles to see if they might be the right investor for your startup.
Look for these criteria:
- Where is the investor located?
- Is he familiar with your company branch?
- Has the investor already invested in a startup from your branch?
- How much does the investor usually invest?
- Can you spot the connections the investor has? Is it a valuable network?
After finding a potential investor, you should contact him via E-Mail or, depending on the social platform, message him/her via instant messenger. Yes, write to them! It is an excellent signal for your potential investor to see that you are making the first step towards him/her.
In addition to finding a potential investor online, you can contact local startup accelerators or other founders, who might have already worked with an investor.
Why you should collect customer feedback/reviews
I have once seen a pitch in cologne where a startup presented a testimonial-video. They convinced one of the most famous soccer coaches from Germany, Jürgen Klopp, to testify that the startup is doing a great job and solving a massive problem no one did before. The whole audience and all investors were deeply impressed.
There is a good reason why influencer marketing has become one of the most powerful marketing tools of our time. People are more likely to buy stuff if someone they know is telling them to buy a product, or someone unbiased is telling them to buy a product.
If you have already sold your product or service to customers and they wrote a positive review on Google etc. you should consider collecting these in a .doc or .xls.
When the time has come to create your pitch deck, you can use the reviews for your traction slide.
