The Art and Science of Pitching Investors: How to Create a Pitch Deck and Raise Like a Pro

The Art and Science of Pitching Investors: How to Create a Pitch Deck and Raise Like a Pro

In the bustling streets of San Francisco, you step out of a rideshare, feeling ready to take on the world. You have a story to tell, a vision to share, and only a few precious minutes to convince a room full of skeptical eyes and crossed arms. How will you do it? There’s an art and a science to pitching investors. The good news is it’s definitely not rocket science. If you want to rise above the rest and distinguish yourself from the countless pitches and decks they see every day, read on.

I often find myself engrossed in conversations with passionate startup founders asking me how to create fundraising decks, where to find investors, how to pitch investors, and generally how to raise money for their startups. The passion for their vision is always palpable. However, an uncertainty about how to translate that passion into a compelling story that resonates with investors is often present. This is a problem every startup founder has faced. I’m no exception to the rule. While I’m by no means an expert at creating fundraising decks or pitching investors, I’ve had the privilege of standing on both sides of the table — raising funds for three venture-backed startups I founded and investing in over 100 early-stage companies. I’ve seen the good, the bad, and the ugly. The advice I’m about to share has helped me to raise pre-seed and seed rounds between $600k — $2.6M in the past.

So, what’s the secret to a good pitch? The truth is, a good pitch is not a presentation. It’s a conversation. Your slides? They’re just there to back you up.

This advice is how to pitch investors to raise early-stage funding typically between $1M — $2.5M. Things get more complicated when you’re looking for bigger investments like Series A, so for now, let’s stick to the basics:

• Clearly explain what your startup does.

• Show the growth and progress you’ve made.

• Assemble a world-class founding team.

• Get multiple investors interested to create buzz.

• And if possible, be profitable or at least break even before you ask for more.

If you don’t have an idea for a startup yet, read my article on “How to Recognize Business Opportunities and Validate Your Ideas

If you need help fleshing out your idea or generating a business model, read my article on “How to Shape Business Opportunities through Business Model Generation

Fundraising Deck Template

I created a simple early-stage fundraising deck template to help you pitch investors. You can duplicate it in Google Slides by going to File → Make a copy → Entire presentation or download it to edit in PowerPoint by going to File → Download → Microsoft PowerPoint (.pptx).

Creating a Pitch Deck: Key Slides to Include

When creating your pitch deck, make sure to lead with your most compelling slides. If you have lots of traction, start with that. If you’re an objectively impressive team, lead with that.

As an angel investor, I sift through countless pitch decks, looking for the proverbial needle in a haystack. But here’s a little secret: it’s not about how many slides you have, but about hitting the right notes. From my experience, here are the key slides I look at:

Company Purpose

Imagine stepping into an elevator with a potential investor. You have mere seconds to grab their attention. What would you say? Your company purpose should be concise, clear, and compelling. Think of it like an elevator pitch, but shorter. Place this single declarative sentence on your title page to set the tone. Make it specific, easy to understand, and ensure it communicates exactly what your company does.

Pro Tip: Keep it simple, direct, and concise. Here are a few examples:

• “Airbnb for workspaces”

• “Netflix for comic books”

• “TurboTax for the Philippines”

“Connecting remote software engineers with fast-growing companies.”

“We help businesses turn onetime customers into lifetime subscribers.”

Traction

If you started a novel with an action-packed scene, you’d be hooked, right? Similarly, if your traction is strong, let it be one of the first slides in your deck, right after the title. It’s a powerful way to grab attention and build credibility from the outset. It answers key questions:

• Are you making money?

• How fast are you growing week-by-week or month-by-month?

• Are customers coming back?

• Are they spending more money as time goes on?

• Do they refer others to your product or service?

• Do they love what you’ve made?

Pro Tip: Use clear graphs and visuals. A rising graph showing growing revenue is what every investor wants to see. Remember, seeing is believing. If you have notable traction, don’t bury this slide in the middle. Move it up. Use key revenue metrics to show growth.

Team

Behind every great startup is a great team. Imagine you’re watching a movie trailer. The plot intrigues you, the visuals awe you, but then you recognize your favorite actress, and suddenly, you’re sold. That’s the magic a strong team can bring to a pitch. This slide isn’t merely about listing names and qualifications; it’s about showcasing the dream team that will propel your startup to the promised land.

Investors aren’t just investing in an idea; they’re investing in people. Highlight:

• Who you are.

• What you’ve achieved before.

• Why you are the best people to make this idea a reality.

Your backgrounds, skills, and unique experiences can set you apart. Make your investors believe not just in the idea, but in the passionate people behind it.

Pro Tip: Highlight notable or relevant work or educational experience. This slide should include photos of each founder, their position at the company, and a brief description of why they add value to the team. Showcase past successes, unique skills, and any relevant expertise.

Market

It’s crucial to show a deep understanding of the market you’re entering if you want to raise venture capital. To answer the question: “Can this be a billion-dollar business?” Conduct a bottoms-up calculation for your Total Addressable Market (TAM). This means starting with your immediate potential customers and working up to the larger opportunity.

Instead of pulling big industry numbers from reports that you can’t explain, use the bottoms-up approach:

  1. Determine Your Potential Customers:

– Look into the future, not just today. Think about who you’ll sell to in the next ten years.

– Consider different places (geographies) and sectors (industries) you plan to enter, along with other revenue expansion opportunities.

  1. Calculate Annual Spending:

– For businesses selling yearly contracts (like many enterprise companies), simply figure out what customers would spend annually.

– If you’re selling monthly (like some B2B SaaS companies), take your monthly rate and multiply it by 12.

– For companies charging per use (e.g., tax software), estimate how many times a customer will use your product yearly and how much you’ll charge each time.

Why This Approach Works:

• It’s based on research and your business’s specifics.

• It’s more believable and defensible. Instead of just throwing out a number, you’re providing a justification for how you got there.

Pro Tip: Avoid generic or overly broad estimates. Instead, break down the numbers. If you’re launching a pet grooming service, start with the number of pet owners in a specific city, the average spend on grooming, and scale up to calculate the TAM by multiplying the number of pet owners in your country by the average spend per owner per year.

TAM = (Number of potential customers) x (Average spend per customer per year)

Let’s say your target market is Miami. There are a total of 500,000 households that own dogs in Miami. Your current customers spend an average of $100 per year on your pet grooming services. In your city alone, this is a $50M market opportunity (500k pet owners x $100/year).

Now, let’s move onto what the investors really care about: the TAM calculation. There are 87 million households in the US spending an average of $100 a year on pet grooming services.

87M pet owners x $100/year = $8.7 billion

Your pet grooming business is an $8.7B market opportunity.

In your conversations with investors, you may want to mention that pet ownership is growing year-over-year in the US and globally, and the amount pet owners spend on pet-related services is increasing every year as well.

Real-World Bottoms-Up Calculations:

  1. Uber (consumer):

– Customers: 325 million people in the U.S. taking 2 rides/month.

– Revenue: $15/ride (25% booking fee).

– Market Opportunity: $117B.

  1. Slack (enterprise):

– Customers: 50 million U.S. workers at big companies (500+ employees).

– Revenue: $8/employee/month.

– Market Opportunity: $4.8B.

  1. HelloFresh (consumer):

– Customers: 125 million U.S. households cooking at home 3 times/week.

– Revenue: $69/week from meal kits.

– Market Opportunity: $449B.

If after your final calculation, you find that your market is too small (i.e., less than a billion dollars) consider how fast it’s growing by looking up its compound annual growth rate (CAGR) or think of ways to logically and organically expand into other markets.

Some of the best companies created entirely new markets from nothing.

Common Pitch Deck Slides

Pro Tip: Always start with your strongest slides. Got unbeatable traction? That should go first. A superhero founding team equal to The Avengers? Lead with that.

Problem

What’s The Issue?: Describe the main pain point your startup addresses. Paint a vivid picture, but keep it simple and relatable.

Who’s Affected?: Identify the group of people facing this issue. Investors might not know the nitty-gritty of your niche, so help them understand.

Why Care?: Highlight the importance of solving this problem. Why does it matter? How big is the impact?

Support with Facts: Just stating a problem isn’t enough. Back up your claims with data and real-world examples.

Solution

What’s Your Fix?: Briefly present your product or service. What’s the main idea?

Benefits Over Features: Instead of diving deep into the technical side, focus on the benefits. How does your solution make life easier, better, or more efficient for the user?

Value Proposition: Focus on why your solution stands out. How does it add value to potential customers? Why would they choose your product over others?

Why Now?

Every idea has its moment under the sun, and it’s important to show why that moment is now.

Current Market Dynamics: To capture the essence of this slide, identify what’s shifting in your target market. Is there a surge in demand, or perhaps a new regulatory change? Highlight these catalysts.

Trends & Technologies: Showcase those game-changing tech trends or behavioral shifts that align with your business model. Maybe it’s the rise of AI, or perhaps a newfound consumer focus on sustainability.

Competitive Edge: While past success stories can be motivating, what’s key is explaining how you’re uniquely poised to ride the current wave. What makes your approach so novel or disruptive?

Navigating Risks: Every opportunity has its challenges. Use this section to present a proactive strategy on tackling potential risks or barriers.

Vision

If the “Why Now?” slide is about seizing the day, the “Vision” slide is about dreaming of the future. If everything goes according to plan, what will you have accomplished 10 years from today?

Bold & Clear Vision: Your vision is the North Star guiding your startup journey. Whether it’s a succinct phrase like Airbnb’s “Belong anywhere” or a more descriptive statement like Spotify’s “To unlock the potential of human creativity — by giving a million creative artists the opportunity to live off their art and billions of fans the opportunity to enjoy and be inspired by it” or something in the middle like Tesla’s “To accelerate the world’s transition to sustainable energy”, ensure it encapsulates your essence and ambition. Share an aspirational, long-term view of the world your company aims to build:

– BBC: “To be the most creative organization in the world”

– Disney: “To make people happy”

– Google: “To provide access to the world’s information in one click”

– IKEA: “To create a better everyday life for many people”

– Instagram: “Capture and share the world’s moments”

Align with Core Values: A vision isn’t just about market dominance or revenue milestones. It should reflect your company’s ethos and principles.

Make It Relatable & Inspiring: Investors hear countless pitches. What will make them remember yours? An aspirational vision that they can relate to, one that paints a vivid picture of a better world.

Competition

Every market has competition. After all, if there’s a demand, there will be companies trying to capture that demand. Don’t forget to differentiate yourself from competitors — what’s your plan to win?

Market Segment & Target Customer: Begin by clearly defining your market segment and who you see as your ideal customer.

Major Players: List out major competitors. But don’t just name-drop; provide a brief on their strengths and weaknesses. This will show you understand your market.

Visualize It: Whether it’s a quadrant matrix, a chart, or even a simple table, visually contrasting your startup with competitors is an immediate, visual way for investors to see how you stack up to your competitors.

Competitive Advantage: Maybe it’s a proprietary technology, a unique business model, or a different market focus. Spell out why customers would choose you over others.

Unique Insight

By showing that you’re not only aware of your competitors but also have a deep, unique insight into the market, you can boost investor confidence.

Uncharted Territory: Perhaps you’ve uncovered a market need nobody’s addressing or discovered an underserved niche within a broader market. This is the place to highlight such insights.

Challenge the Status Quo: If you have a contrarian view of the market that led to your startup’s creation, share it. Many billion-dollar businesses were the result of a founder being contrarian and right.

Make It Relatable Yet Surprising: The goal of this slide is to intrigue. Your insight should be something investors haven’t heard many times before but can easily understand and see value in.

The Ask & Use of Funds

As the old adage goes, “You don’t get what you don’t ask for.” Be transparent about your funding requirements. Outline how you’ll allocate the funds, and importantly, draw a clear path showing how these funds will help you achieve future milestones, positioning you for a subsequent fundraising round.

• The Amount: Start with the basics. Clearly specify the amount you’re seeking.

The Budget: Provide a breakdown of how you plan to allocate the funds. Whether it’s for product development, marketing, hiring, or operations, showcase your strategic thinking in the use of funds.

Milestones: Investors want assurance that the funds will propel the company towards tangible milestones. Link the use of funds directly to major milestones that will lead to profitability or your next round (series A).

Be Frugal: Treat investor money like your own money. Show investors that their capital will only be used on activities that are absolutely necessary to drive your business forward.

Thank You & Wrap Up

Reiterate Key Points: Concisely revisit the main points of your pitch. Reinforce the problem, your solution, and your value proposition.

Express Gratitude: A simple “Thank You” is enough. Acknowledge the time and attention of your audience.

Contact Information: Provide your contact details, ensuring potential investors have a clear way to reach out to ask questions or invest.

Control The Narrative: While it’s important to be accommodating, try to guide the narrative. If possible, ask potential investors to wait for a live pitch before sharing the full deck. This way, you control their first impression of your company.

Remember, your pitch deck isn’t just about presenting facts. It’s about telling a story — your story, a story of your startup’s inception, its potential, and its future. And while the content is crucial, equally important is the delivery. Ensure that you engage, educate, and excite your audience. As you wrap up this narrative, make your request with clarity and enthusiasm, and close with gratitude.

Other Slides You Might Want To Include

Pitch decks play a pivotal role in engaging investors and telling a startup’s story. While we’ve previously covered the essential slides and some common slides used, let’s explore some other slides that are used. Depending on the narrative you wish to convey to investors and what you want to highlight, you may want to add, substitute, or append the following slides to your main pitch deck or an appendix section.

Go-To-Market (GTM) Strategy

Your GTM strategy illustrates how you plan to capture your market segment and distribute your offerings. It’s your growth plan.

Pro Tip: It’s typically a good idea to copy a successful competitor’s GTM, unless you have a more effective way to reach your customers that gives you some sort of competitive advantage.

Examples of GTM Strategies:

Online Acquisition: Leveraging tools like Google Ads, SEO, and social media to capture your audience.

Offline Acquisition: Traditional methods, like print ads or events, still work.

Inbound Acquisition: Convert leads into customers. These leads are often generated through organic or paid sources. You typically offer them valuable information or a gift to collect their emails when they visit your website.

Outbound Acquisition: Here, you actively pursue your leads through cold calling and cold emails. This is common practice for B2B businesses, like SaaS companies of all sizes.

Financials

This is where you show your projections, usually for 3–5 years ahead, with an emphasis on expected revenue and costs. This slide can vary based on your startup stage. For example, if you’re pre-revenue, don’t even bother with this slide. If you’re very early stage and have financial to show, keep it short and simple. If you’re looking for series A+ it will need to be more detailed.

B2B Slides

If you’re a B2B business, especially with a growing revenue stream, you might want to focus on:

Sales Process and Metrics: Share your sales process, average deal size, and related metrics.

Customers: Show me the logos! Especially if they’re highly influential marquee customers from your industry.

Customer Case Study: A dedicated slide for your anchor customer. Show how your product transformed their business for the better and why they can’t live without you.

Engagement & Retention

For consumer-driven businesses, showcasing engagement and retention rates makes sense. You can show this by including daily or monthly active users (MAUs or DAUs), average session time, cohort retention analysis for subscriptions, and app installs for mobile. It’s all about painting a picture of a product that users can’t live without.

Unit Economics

Especially relevant for businesses with high costs of goods sold (COGS). Show potential profitability and scalability — do profit margins increase as scale? Key metrics here include customer acquisition costs (CAC), customer lifetime value (CLTV), and gross margin per unit.

Tailoring Your Pitch

Remember, the pitch deck is not one-size-fits-all. Based on the story you want to tell investors, it’s critical to make prudent decisions on which slides to include in both your main deck and your appendix.

Keep it simple, make it memorable, and be confident — not arrogant.

Perfecting Your Pitch Deck: Some Tips for Success

1. Crafting Your Story

Less Is More: Adjust the number of slides based on available time. Focus on what’s important: company purpose, market size, traction, team, and the ask.

Tell the Story in Headlines: Ensure each slide’s headline conveys the main idea. If investors only read these, they should grasp the core of your narrative. For instance, instead of “Problem,” use something more exciting that immediately explains the problem you’re solving, such as, “Visiting Mars is Too Expensive.”

2. Design and Layout Essentials

Consistency is Key: Follow a uniform color palette, font, and layout. Let your message shine, not distracting designs.

Simplicity & Clarity:

– One idea per slide. If you’re tempted to merge concepts, resist. Split them!

– A slide should be immediately understood.

Skip Complex Visuals: Simplicity is golden. Use words or basic visuals over intricate diagrams or screenshots.

3. Content Dos and Don’ts

Show, Don’t Tell: Don’t just say you’re the best, prove it with data.

Honesty is Always The Best Policy: Highlight real milestones and achievements. Exaggerations can damage your credibility.

Label Your Graphs: Always clearly label graph axes and units for clarity.

Speak Human, Not Robot: Steer clear of industry jargon. Keep your language accessible and relatable.

Back It Up: Always be ready to back up any numbers or claims you present.

4. The Final Touches

Every Element Counts: Evaluate each slide and word. If it doesn’t add value, reconsider its place in your pitch.

Include an Appendix: Have extra slides? Add them to an appendix and reference them if prompted during Q&A.

Keep It Super Simple!: KISS. Avoid information overload. Craft clean and concise slides.

It’s your moment in the spotlight, so ensure that every slide, every word, and every visual supports your story.

Pro Tip: Don’t reinvent the wheel. You can use the simple early-stage fundraising deck template I created as a starting point for all of this.

How Much Money Should I Raise?

Plan for the Future, Not Just Today: Consider your operational expenses, growth initiatives, unexpected costs, and your runway. Your runway is how long you can operate at your current burn rate (expenses). Usually, it’s 12–18 months, but during uncertain economic times I’d shoot for 24 months.

The Goldilocks Scenario: Aim for the sweet spot between your survival budget and the ideal scenario. Just like the fairy tale of the same name, this amount is typically “just right.” Why? If you raise less, you can always fall back on your survival mode budget. Raising too much money can make you complacent. You need to be hungry if you want to succeed.

Know Your Worth: If you’re getting more than you asked, great! But don’t dilute your equity by more than 15–20% in the early stages. After all, it’s your dream. Keep the lion’s share.

How to Raise Money for Your Startup

Finding investors and securing funding for your startup can be a pivotal step toward realizing your entrepreneurial dreams. Here are some options to consider for funding:

Personal Referrals: Leverage your personal network. Friends, family, and colleagues might have connections to potential investors. A warm introduction from a trusted contact can make all the difference. Don’t know how to do this? Check out How to Find Investors and Get Email Intros by Justin Kan of Justin.tv fame.

Accelerators and Incubators: These entities not only provide funding but also offer mentorship, training, and resources. Their primary goal is to fast-track the growth of promising startups, and they often have vast networks of potential investors. I’ve personally gone through Y Combinator and Amplify and some of my best clients went through Techstars.

Networking: Attend conferences, industry-specific events, and local meetups. Such events can provide serendipitous encounters with prospective investors. Online forums and communities related to your domain can also be gold mines.

Online Platforms: Websites like AngelList, Gust, and LinkedIn can bridge the gap between startups and angel investors or venture capitalists.

Pitch Competitions: Beyond popular TV shows like Shark Tank, Dragon’s Den, The Profit, Planet of the Apps, and Make Me a Millionaire Inventor, many organizations host startup competitions like Startup World Cup, Collision, TechCrunch Disrupt, Web Summit PITCH, and Slush. Winning or even just participating can provide visibility, validation, and often, direct funding. I’ve invested in companies whose founders I met at pitch competitions before.

Crowdfunding: Platforms like Kickstarter and Indiegogo allow you to present your idea to the public, offering them a chance to back your venture in return for early access or other perks. For equity-based crowdfunding, platforms like StartEngine and Wefunder allow potential investors to buy a piece of your company.

Grants: These non-repayable funds can come from government bodies, private corporations, or trusts. Ensure your startup meets the criteria and follow the application process meticulously.

Bootstrapping, Moonlighting, or Consulting: Before external funding flows in, consider self-funding. This might mean using your savings, taking on consulting gigs, or even maintaining a part-time job. Starting lean can give you more control and reduce initial financial pressure.

Pitch Perfect

Secured an investor meeting? Congrats! Now let’s make sure you can pitch with confidence…

Before the Pitch:

1. Investor Tracking Spreadsheet: Just as salespeople maintain a lead list, you should prepare a spreadsheet to track all potential investors. Note down their average check size, due diligence period, level of interest, commitment status, the date and mode of your most recent contact, and any pertinent follow-up actions.

2. Practice Your Pitch: Practice makes perfect. Have a friend or cofounder pretend to be an investor and walk through your pitch with them as they ask you questions. If you’re friends with an investor, ask them for advice.

The Pitch Itself:

3. Engage in a Dialogue: It shouldn’t be a monologue. It should be a two-way conversation that keeps your audience engaged and asking questions.

4. Exude Confidence: Confidence, not arrogance, is key. Know your key metrics, competition, market, unique insights, and risks. If you don’t know something, tell them you’ll get them the answer later and make sure to send it to them.

5. Ask Them To Invest: At the end of each investor meeting, ask them to invest. Otherwise, why are you even pitching? Make sure you’re explicit about the terms of the investment like “We’re raising $1M with a $10M valuation cap”

After the Pitch:

6. Iterate and Reflect: Always take time to reflect on each pitch. What resonated with the investors? Which areas need improvement?

7. Debrief and Document: Write down the questions that arose, the areas you felt confident in, and the topics where you stumbled. Make sure you know those answers by heart next time.

8. Respond Quickly: Show your commitment and urgency by promptly responding to introductions, queries, and any other commitments you made during the pitch.

A successful pitch is about more than just your product or business; it’s about the story, your passion, and the potential for growth. By embodying confidence, engaging effectively, and demonstrating thorough knowledge about your business, market, and competition, you can leave a lasting impression on investors. And don’t forget, every pitch is an opportunity to improve, a learning experience that brings you one step closer to your vision.

Due Diligence

Got an offer? Be prepared for investor due diligence.

  1. Legal Basics: Certificate of incorporation, bylaws, and employment agreements.
  2. Ownership: A comprehensive cap table, inclusive of everyone — from founders to stakeholders.
  3. Past & Future Financials: Historical financial statements, detailed financial projections, and an operating plan.
  4. Additional Info: Things like patents, regulatory approvals, detailed tech explanations (make it easy to understand), and relevant publications.

It’s always best to consult an attorney instead of relying on information you find online or your own understanding. I’m not a lawyer and this is not legal advice. Most early-stage investors will either opt for a SAFE or a convertible note. SAFEs, especially, are designed for quick agreements without diving deep into the company’s valuation just yet, but sometimes if you’re raising from an institutional investor you may receive a term sheet for a priced round in which case you’ll definitely want to consult a lawyer.

The Alchemy of the Perfect Pitch

There’s a magic moment when ideas, behaviors, and messages spread like wildfire, a moment when a pitch transforms from a mere presentation into a compelling narrative, so gripping that investors feel an irresistible urge to be part of your story.

The elements of an effective pitch deck, as laid out above, aren’t just items to check off a list. They’re interconnected pieces of a larger tapestry, with each thread contributing to the bigger picture. It’s the story, your delivery, and the authenticity of a pitch that makes it memorable.

We’re all looking for that point where understanding dawns, where skepticism melts away, where the scales tip in favor of belief. The perfect pitch doesn’t just secure funding; it galvanizes your investors into fervent believers of your vision for the future.

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