Preparing a perfect pitch deck is strongly linked to the likelihood of you being able to raise money successfully and arguably one of the most important tasks of any founder.
As an angel and entrepreneur, I’ve seen hundreds if not thousands of slide decks by now. And I am convinced that being able to tell a clear story with your pitch deck is THE biggest differentiator to eventually outperform your competition and receive funding.
This guide intends to walk you through a clear set of steps that any founder can follow to prepare a good, compelling (pre-seed or seed) slide deck. I will focus on three key steps:
- Preparing your content
- Crafting your story & creating your pitch deck
- Compiling feedback
Leaving out one of them will usually result in a low-quality deck. However, by following these steps rigorously and thoroughly, I guarantee you a great result.
Preparing Your Content
While every pitch deck is somewhat individual, there are two famous pitch deck formulas that any founder can follow:
The Sequoia pitch deck template and Guy Kawasaki’s pitch deck template.
For simplicity, I will only list all slides Guy Kawasaki recommends:
- Problem / Opportunity
- Value Proposition
- Underlying Magic
- Business Model
- Go-To-Market Plan
- Competitive Analysis
- Management Team
- Financial Projections & Key Metrics
- Current Status, Accomplishments to Date, Timeline and Use of Funds
The main difference to Sequoia’s template is that Sequoia places high importance on timing. You may want to include a ‘why now’ slide, indicating why now is the best time for your business to succeed. Sequoia likely refers to this study which shows that timing is the biggest success predictor of startup companies.
Arguably though, it is almost impossible to justify the correct timing prior to the success of the venture. I recommend to only include this slide, if there is crystal clear evidence that your solution is now needed and/or achievable more than ever before.
Another main difference is that Sequoia wants you to talk about market sizes. If you have a good estimation of how big your market is, include that in your deck. The size of your market provides a good indication of how big your opportunity is.
1.1 Source content for all slides of your pitch deck
In a first step, decide which slides you want to include and compile as much content about them as possible.
This can range from several pages per topic to a bunch of bullet points. It makes sense to prepare a word document or a bunch of potential visuals with your answers to all of the 10 slides from Guy Kawasaki’s template.
Later, you can tweak and amend the structure for your specific needs. For example, for our slide deck at EWOR, we’ve included an extra slide on traction and community as those are especially relevant for our specific case.
In a second step, go through your content multiple times and make sure you feel comfortable about having found convincing answers to at least all of the ten categories from above.
Before you start a pitch deck, make sure to research, brainstorm and strategise thoroughly.
The quality of your pitch deck will drastically depend on how well your content is researched.
Furthermore, investors will have many follow up questions for you after having seen your pitch deck and being able to provide in-depth answers is crucial.
As a next step, check your content for ‘beginners’ mistakes’.
1.2 Avoid beginners’ mistakes
For every single slide, there are several mistakes first time founders make sometimes. I have listed the most common ones below.
You talk about the solution, not the problem
Problem means problem. Most founders talk about solutions even though their slide deck heading says ‘problem’.
Your slide should describe the problem as specific as possible and make it absolutely clear that solving this problem is a big opportunity.
There are very few pitches, even though they exist, that focus on solutions only. Usually, those slide decks focus on addressing a crowded market with many existing solutions. A fantastic example of this is Drop Box first pitch deck, which shows a messy desk followed by the sentence “It’s 2007, and it’s still a pain to… (1) work on multiple computers, (2) share files across a team, (3) Put photos, video onto the web, and (4) protect files from loss.
Also, make sure to focus on a problem worth solving. For example, Robert Fitzpatrick’s book ‘The Mom Test’, explains vividly that true problems need to be so painful for people or businesses that they’re willing to pay a significant sum of money to avoid suffering that pain.
It’s easy to get someone emotional about a problem if you lead them there. “Don’t you hate when your shoelaces come untied while you’re carrying groceries?” “Yeah, that’s the worst!” And then I go off and design my special never-come-untied laces without realising that if you actually cared, you would already be using a double-knot.Robert Fitzpatrick
Don’t fall for the ‘double-knot fallacy’ and make sure that your problem is worth solving.
Overgeneralisation: A ‘strong team’ or ‘amazing technology’ is not an USP
If you can’t back your USPs / underlying magic, don’t bother listing it. ‘Strong team’, ‘amazing technology’, and ‘one-of-a-kind product’ are not great USPs. Those are generic statements and every investor out there will be aware of that.
You want to describe what makes you special and make it comprehensible as to how this specialty helps you earn a lot of money.
Moreover, ‘huge market’, ‘big problem’, and ‘based on AI’, are also not USPs. That is, a huge market, a big problem, and AI are something every person can tap into. Anyone can address your huge market or hire devs to create AI applications. Instead, combine those topics with other parameters to make them unique.
For example, you’re onto something big if a huge market is only addressable by you; maybe because you’ve spent 15 years in the industry and you’ve built an alliance that owns the distribution channels. Also, if your team has created a unique technology that can’t be copied. Focus more on why you believe it can’t be copied and why it is superior to other solutions.
Your Business Model does not cover the whole value creation process
A good business model does at least cover the following components:
- How you generate value (this doesn’t need to be covered on your slide as you’ll likely have answered this in the previous slides)
- How you bring that value to the customer (distribution)
- Your method for capturing some of that value (pricing)
A good business model slide is about both distribution and pricing.
Bad business model slides include only a generic price tag and do not go into detail of how that price relates to the other components of your business, your competition and your customers.
In case you’re still wondering what the difference between pricing and a business model is, read this article from HBR.
You compare yourself with your competition in irrelevant metrics
There are two very common mistakes with first-time founders.
The first one is the ‘right corner’ syndrome. Most founders show their competition on a 2×2 matrix-like graph like this one.
Some founders invent two arbitrary axes that make their business appear in the top right corner.
A good investor will immediately spot that the axes are not important differentiators for your business. Try to choose axes that are relevant for differentiating your business in one specific market. If you’re not the most differentiated, use this slide to explain why you’ll still be able to outperform your competition.
Secondly, founders often choose tables like this one to show what makes them different to their competition.
This can be a great way of showing why you are special, but the dimensions of comparison you choose need to be relevant.
I often spot founders who choose a ridiculous amount of additional dimensions just to place a couple more ticks on what they have that others don’t.
What you have that others don’t, needs to give you an advantage over your competitors. If it doesn’t, don’t include it in your deck.
You do not explain why your team is the best for the job
Include the founding / leadership team only. Make sure to add a description or at least a bunch of compelling logos indicating that your management team is in a good position to make your venture succeed.
More often than not, slides with 8+ team members (and their titles) are passed as “Team Slide”. But what do founders want to convey with those slides?
Maybe they merely want to indicate that there is a team or that they’ve found a good organisational structure, but for an investor this will probably not suffice.
You need to be able to explain why your team is better equipped than any other team out there to execute the mission successfully. This usually includes a description of the team members’ biggest achievements.
Those achievements should be linked to the solution you’re trying to build. Otherwise, it will remain questionable whether your team has sufficient experience within the industry to outperform the competition.
Another tip is to indicate which part of your team is already full-time and when the ones currently being part-time will join your business full-time.
Your market size slide is not interesting
There are two common beginner mistakes when it comes to reporting market sizes.
The first mistake is that founders take a large market and claim to get 1% of this market without providing clear evidence of why that is.
For example, the global big data market is €139 BN and by capturing 1% of this market, you’ve created a billion-dollar business. However, you want to justify that. The competition won’t just give you that one percent because they don’t care enough about it.
You can add credibility to your claims by providing in-depth calculations of your market sizes. You can use SAM and SOM in case you’re using a TAM/SAM/SOM framework.
Also, make sure that those calculations link to the content you’ve put on previous slides and content you’ll list during your financial forecast later. Again, it’s all about credibility and consistency.
Secondly, don’t bother reporting small market sizes such as a € 100 million total addressable market (TAM).
Most investors know that most of their investments will fail. Therefore, they need billion-dollar opportunities to make up for all the failures in their portfolio. They thus look for billion-dollar opportunities. Anything below € 100 million ARR might be not interesting for a typical venture capitalist or savvy angel investors.
However, if you are addressing a tiny niche, there might still be some more laid back angels or family offices that will invest.
Crafting your story & creating your pitch deck
2.1 Creating your story skeleton (example)
Now that you’ve prepared your content properly, it is time to define your story.
As a first step, do not start by just building a slide deck. Instead, list the headings and one key sentence for every slide and see if the story adds up.
One should get the gist of your business by just reading those sentences.
A (fictional) example could be:
- Problem: Trade marketing is messy and intransparent, making it impossible for managers to make sound, data-based decisions on promotions.
- Solution / Value Prop: We help managers make data-driven decisions about promotions. We do this by having created a user-friendly dashboard that plugs into existing company data sources and processes data through machine learning models.
- Underlying Magic: We’ve co-developed our model with our users who are colleagues of ours and have access to the president of the European Trade Marketing Organisation (ETMO), who is in our advisory board.
- Business Model: We charge a set-up fee (€ 10’000) and a monthly user fee (€1000 p/user) allowing businesses to generate millions in additional sales.
- Go-To-Market Plan: After having onboarded three NASDAQ customers, we’re building a sales force to further penetrate the market.
- Competitive Analysis: Our competition offers costly consulting services and deploy machine learning models that managers do not understand, while our dashboard is cheap and user-friendly.
- Team: Our founders have thirty years of experience in the trade marketing industry (Kate Miller) and twenty years of experience in building AI-driven software applications (John Doe).
- Financial Projections & Key Metrics: We plan to onboard 1800 customers within the next 7 years with 5 regular users each resulting in €108.000.000 in ARR.
- Current Status and Use of Funds: We have sold our prototype to three large corporations. We are now looking for funds to improve our product (30%) and hire a sales force to monopolise the market (70%)
You want to build a couple of versions of these stories. In the best case, write at least three different ones until you start creating your actual deck.
2.2 Finding the perfect length of your pitch deck
Before we jump into creating your deck, a final note on length: length matters.
8-12 slides are a good goal. Slide decks that are shorter struggle to convey the entire story and slide decks that are longer either dilute the message or take too long to read.
If your traction, USP, team or market are incredibly interesting, you might be able to pull off a shorter slide deck. In any other case, it makes sense to go with at least 8 slides. As for longer slide decks, investors usually see dozens of slide decks per day. Not wasting their time by including useless slides is important. Moreover, especially if you’re preparing a pre-seed slide deck, having many slides is an indication of your inability to make a clear point.
Seeing that other people are not concise in their decks is usually much easier than discovering this in your own pitch decks. Usually, you will need multiple iterations of feedback to make sure that your storyline is clear and concise.
2.3 Create a first deck
Next, I recommend you turn each of the bullet points from your skeleton into a deck.
You can use ‘action titles’, which are close to but shorter than the bullet points from above. This makes your slide deck easier to digest for investors.
Moreover, do not worry about design at all at this point in time. You might want to scribble a bunch of visuals, but I recommend that you do not yet focus on perfection.
Instead, go back to step one (your skeleton) and see whether the gist of what you want to communicate changes. This is quite usual, as you’ve started very abstract and have gotten richer (i.e. more specific) over time when adding more content to every slide.
This process of jumping between abstract and rich thinking patterns will help you craft that key story you want to convey.
After you’ve updated your skeleton, go back to your rough deck and repeat this process. Iterate until you’re proud of the result.
By now, your mum, your siblings or your friends should be able to read the deck and understand it instantly. If not, go back to the previous step and keep iterating until you’ve created a deck that is easy to digest.
2.4 Design your deck
Now that you are able to tell a compelling story with the content in your deck, it is time to work on the visuals.
While I have the feeling that most people think of design as a final admin step that conveys your content more professionally, it is much more than that. Pictures speak more than a thousand words. Finding the right ways of communicating your content visually will make a huge difference.
Therefore, I recommend that you create at least three different visual representations for every single slide in your deck and run them by your friends to see which emits your message best.
Once you’ve found the right visual representations, work on your colors, the structure of your content and your shapes.
This is the easy part and there are only a few steps to follow:
- Consistency: Use shapes, colors, and distance consistently. For example, if your style is based on round shapes, avoid edgy shapes and stay consistent. Moreover, do not use too many colors at once. Focus on max two main colors. Make use of the ‘guides’, a great feature that Powerpoint and GSlides offer. Guides will help you place your headings and content in the right frame and will make your slide deck look professional.
- Spacing and font size: Good designs tend to have more free space and larger font size. Guy Kawasaki postulates the 10/20/30 rule: 10 slides, 20 minutes of pitching max, and 30-point font. The latter forces you to keep your content to the point and makes it easy for investors to digest your story.
Don’t overdo these two steps. The most important part is that you find the right visuals making your story more plastic. All other design work plays a role, but a very little one. If you’re struggling with understanding how good your deck needs to be, check out some famous slide decks.
Make sure to check out the more recent ones, such as OOmf, and those similar to your current round. For instance, looking at Facebooks Series B Deck from 2004 (almost 20 years ago) will not be helpful for your pre-seed round.
Usually, you need to go through several rounds of feedback until your deck is ready. This is what this part is focusing on.
In case you’re wondering why feedback is so important: especially as a first-time founder, you’re lacking experience. When I created my first pitch deck, I had the feeling that it was perfect. But the first pitches taught me the following: it sucked, a lot.
Rumsfeld, former US Secretary of Defence, explained this perfectly by popularising the term ‘unknown unknowns’: There are things you don’t know you don’t know. You are not aware of the existence of them. Thus you need feedback from your environment in order to fill these gaps in your knowledge.
There is no way around this but to collect feedback.
The process of feedback collection for your pitch deck can also be run in an optimal way, at least theoretically:
- Start with investors you know, or those that your friends know, and ask them for feedback first, not for funding.
- After they have provided feedback and you feel comfortable with pitching your venture, compile a list of investors. Rank them on how much you’d like to have them on your cap table. Start from the bottom and phone up those first whom you’d like to have least on your cap table.
- Phone the best angels and VCs last. Especially after you already have some commitments. It’ll be easy to convince good investors once some have already committed.
You’ll be surprised by how much important feedback you’ll still be able to gather just by getting serious and asking for real money. It is quite likely that there will be some ‘fuck ups’ that you do not want to have in front of one of your favourite investors. Even though, I’m now pitching for a while, I still fuck up regularly. In best case you do that, when you are still in practice mode. When you ultimately approach the big guns, you need to have nailed your pitch down.
Why having a good pitch deck is important
Receiving funding is one of the most important predictors of your future success.
This is not only because investors believe in you, but also because additional money helps you grow faster and thus outperform your competition in terms of speed.
Investing a considerable amount of time into creating a perfect pitch deck is worth the effort. Focusing one or two months, nearly full-time, merely on perfecting your deck is a good estimate.
Keep in mind that only 1% of ventures wanting to raise money from VCs get it and that it usually takes between 6-12 months of full-time work to raise a round.
I hope that this guide helps you in creating your perfect pitch deck and will lead to you receiving the money that your venture deserves.
Connect to Daniel Dippold on LinkedIn here