You better make those 4 minutes count.
The early stages of a start-up are not easy. There is a lot of work, plenty of doubt, and very little money. One of the pivotal steps of its history is when you finally get the chance to present your idea to possible partners or investors. Making a good impression in that presentation could ramp up your way to success – or it could close several doors all at once. This is why putting together a concise yet comprehensive pitch deck is so important. It can literally make or break your business.
You usually have 3 to 7 minutes to present your pitch. In that short time, the audience needs to be able to understand what are you trying to do, and how is it going to make them money. Of course, depending on your solution and the audience the content and point of view of your pitch might vary , but there are 8 questions it should always be able to answer.
Market fit : What problem are you solving?
You might have heard that “you don’t sell the product, you sell the problem”. This is because it’s the problem (or desire), that leads consumers to invest in a certain product or service. This is why the first thing your pitch needs to establish is the existence of a problem.
Explain the need, frustration, or desire your product is targetting and how this particular issue is affecting their lives. Make sure to back this up with data from reliable sources. I can’t stress this enough, don’t let your confirmation bias write your pitch. If you find a statistic that proves your point – interrogate that statistic to make sure it has feet to stand on.
I can’t tell you how many FashionTech startups start their pitch by saying “Fashion is the 2nd most polluting industry on earth”, a statement that has been retracted and disproven. If you are pitching to me, and you start with that statement, you already start with the wrong foot.
Market size : How many people is this issue affecting?
Again, you need to remember that the point of the pitch is to convince the people sitting at the other side of the table (or zoom meeting) that you have a solution to a problem that can make them lots of money. So it is very important that you estimate how many people can relate to this particular issue.
Is this an existing market or a completely new one? What are the current size of that market and the previsions of growth in the next years? How much of the total market do you think you can aim to occupy?
I know – these are difficult questions. But you need to be able to answer them.
Competition mapping : Which solutions are there currently available to solve this?
An important part of calculating your possible market share is, of course, mapping out the competition. Many startups and novel entrepreneurs believe they have no competition. Very few of them are right.
In most cases what happens is that they did not do a thorough enough competition research. In other cases, they did do good research when they started working on the solution but in the time they needed to get to a pre-seed stage, new competitors passed them by. The start-up ecosystem changes very rapidly, so your competition mapping is something you need to be constantly monitoring and updating.
And you should be especially aware of any similar products or services that might already be on the portfolio of the investor you are pitching to. Oftentimes Startups go on a “pitching bender” to try and put their solution to as many investors as possible. This is a good idea. What is not a good idea is arriving at the pitch without having done your research on this particular entity, its priorities, and current investments.
Competitive advantage : Why is your solution better?
It’s important to identify your competitors. But that is not enough. You also need to be able to explain the reasons why your solution is the best. Ideally, you will have designed the specific features of your product or service in order to make it stand out from the existing options in the market.
What makes your solution better? Explain the reasons that make your company more effective and promising. The reasons why they should see this as a smart business opportunity for them.
I always say that for a product or service to be better than another it needs to save the customer money, time, or peace of mind. And it needs to ultimately make the company or investor gain more money, time, or peace of mind. How can your solution do this better than the other players?
Monetization: How will your company make money?
Not every good product idea is a good business idea. Many entrepreneurs come up with great solutions to help bring people together, or save the earth…but fail to define a solid monetization strategy.
Every business needs to be able to make money to exist and grow. Even positive-impact businesses with a strong environmental or social cause at heart need to be able to find a way to make their business model profitable. You need that just to make things happen – but you really need it if you are looking for investment. Keep in mind the triple bottom line: Profit, people, and planet.
Ideally, you want to create a business model that allows you to draw revenue from different sources. Most business ventures nowadays are walking the line between products and services, creating several parallel revenue streams. If you want to future-proof your company, try thinking in that way as well.
Scalability : How will it grow over time?
A start-up by definition is just starting. So…what happens next? How will your company be able to scale up and take over the market? You need to be very clear on both your mid and long-term goals and the steps required to achieve them.
The scalability of a start-up is one of the key attributes that determine its potential. Because of this, it’s one of the main questions in investors’ minds, so you need to make sure to include it on your pitch. Many ideas that seem solid on a small scale, end up failing when they start growing. Some business models and even products are simply not scalable – which makes them dead on arrival from an investment point of view.
Think about what will happen when your business starts getting traction. What efforts are required to get to the next level? Which additions of the team or new tools will be required? How will this affect your overhead and bottom line?
Team : Why are you the best people to make this a reality?
Believe it or not, one of the main things investors want to know is who is behind the project. They want to know not only how talented and accomplished the different members are, but also how well do you work well together.
According to research published by Harvard Business School, management is the main reason Start-ups fail. VCs pay a lot of attention to founders when selecting investments. Founders were listed as “an important factor” by 95% of VCs, and as “the most important factor” by 47%.
Let’s be honest: a lot of start-up ideas are born between friends over beers. That is fine. But once you decide to take your business seriously, you need to make sure to gather the best team for the job. You have to involve experts on the field and market you are targetting, whether that is through direct employment or by making them part of your advisory board.
Ask : What do you need to make it happen?
One of the most “popular” ways to end a pitch is by asking. And this is very smart. Being very clear about what you need to get to the next level can help you get there.
First of all, when you present a well-thought-out ask, you prove that you are serious and thorough about your strategy. That you have really thought this thing out. On the other hand, it also helps the people sitting on the other side of the table to understand the kind of commitment you need. Some VCs or partners might be looking for safer bets, while others might appreciate the opportunity to go all-in in a great opportunity.
When you are noting what you need, make sure to include not online the figure (the investment you are aiming for) but also why do you need this. Do you need to extend your technical team to finish the proprietary algorithm? Invest in the promotion required to capture users? Or maybe the most important thing you need right now is guidance and connections.
And remember, the pitch is just the start of the conversation.
Odds are you are going to have to be telling the same story dozens of times, to different kinds of people. Some of them will like what they see, and some don’t. This doesn’t necessarily mean that what you are presenting is wrong. Sometimes it just means that it is not a good match.
I urge you to think of pitches as speed dating: You have a few minutes to try and make the other side understand who you are, what do you have to offer, and what are you looking for. If they find this enticing, I guarantee you there will be plenty more minutes to get into details. Just remember to be prepared, direct, and honest.
And if you think you might need a bit of extra help getting the pitch deck ready or preparing for these meetings, don’t hesitate to reach out! You can use the contact form below to send me a message or book a free 20min discovery call here.
