Welcome to my next article. My previous article was on Business plans, if you missed that, you can quickly check it out after reading this.
Today, we will take a look at Pitch decks and the importance of having one. Although having a business plan is great, pitch decks make it easier for investors to quickly understand your business offering, ask the necessary questions and finally decide whether to invest or not. Having a pitch deck saves both parties time since pitch decks are normally short , use a lot of visuals and are straight to the point compared to a business plan which has about 10-100 pages. The pitch deck is more visual and to the point as compared to a business plan.
According to a study by Docsend, the length of an average pitch deck is 19.2 pages and the average time spent by an investor on reading a pitch deck is 3 minutes 44 seconds. So, in essence, your pitch deck should have less than 20 pages as the investor will not spend more than 4 minutes reading it. Let’s take a look at what pitch decks or investor decks are.
What is a Pitch Deck and why is it important to have one?
According to Masterclass, A pitch deck presentation also known as a startup pitch deck or slide deck is a visual document that provides investors with essential information about your business plan, product or services, fundraising needs, and key metrics like valuation, target market, and financial goals.
Pitch decks are important because they act as a sales pitch to the investors and makes them appreciate and understand the business. It also allows startups to tell their story in a way that is concise and engaging, as well as helping potential customers understand how it will benefit them or their company. In addition, a great pitch deck helps prospects see themselves using this product with clear use cases and testimonials from real customers.
The overall objective of a pitch deck is to give investors a reason to believe that the startup is viable and worth investing. However, investors do not invest in a startup right away after being presented with a pitch deck. It takes a lot of follow up meetings before finalizing on the investment or contract.
What Slides are included in a Pitch Deck Presentation?
The requisites for the Investor Pitch deck vary from investor to investor, venture capitalists, and startups founders. An investor pitch deck shall cover the following key contents in the presentation slides ;this is combining our own experience and a study by Docsend
- Introduction / About the company– The first slide should talk about your company, mission and vision and the value proposition.
- Problem: The second slide should explain the problem your startup is trying to solve.
- Solution: This slide should cover the solutions the business is offering to its customers.
- Offering/ Products: The product slide should talk about the services or products you are offering which should include pictures of the products or services.
- Market size: The market size determines if the business will get funding or not. It should include how to roll out your product and capture market share. By stating the market size, you can project your future performance and help investors see your growth opportunity in the market.
- Competition: Talk about your competitors and how you will compete with them in this slide
- Traction : This slide validates the company’s business model by showing any month-over-month growth through early sales and support. The goal is to reduce any fear of risk in potential investors.
- Business Model: Explain in this slide the capacity of the business to generate money and benefit the investors, owners, and consumers together. Here you can highlight the advanced strategies that your business will employ to bring better and bigger profits.
- Team: illustrate the members of the leadership team, their positions and the achievement of each team.
- Financials: This slide should talk about the financial health of the company for a period of 3 to 5 years which should include income statements and projected growth.
- Ask : This slide should include how much money you are asking for.
- Use of funds : Lastly highlight how your startup would use the funds.
There are variations on this, but these are some good guidelines for a pitch deck. Many winning pitch decks can be shorter, more visual or take some other interesting approach to engaging and presenting information to potential investors.
In conclusion, always remember that a pitch deck is an investor’s first impression of your startup and It needs to be compelling enough to convince them that it is worth investing in your company.