Having an impressive pitch is a key component in raising capital. A great pitch can get an investor excited about your business and opens the door to the investors wanting to learn more and take you through a due diligence process.
There are thousands of templates online that provide guidance on what slides to incorporate in your pitch deck. These are certainly must-haves, but ask yourself – does my pitch deck tell the story of my business?
While it is extremely important to cover the bases of market need, value proposition, market size, etc., keep in mind that investors need to feel there is an underlying story being told with your pitch. What this means for investors is being convinced that your story can create enough value to generate a return from their fund, which requires both a financial and emotional investment in your business. Investors need to fall in love.
In my experience, the most effective investor pitches touch on the following key areas of your story:
Where you’ve been
How did you start? Who were the characters? What has happened since the beginning? Were there challenges along the way? What have you learned?
Where you are now
What does your business do today? What problems does it solve and what is the value proposition? Who are your customers? Who are your competitors? Support this with data on key performance indicators (KPIs) such as your number of customers, revenue, engagement and other important metrics that support your current status.
Where you are going
The vision! How are you going to grow and scale? How will the investor get a return on their investment?
While “where you’ve been” and “where you are now” are important for the investor to understand, the storytelling is most effective when it comes to the “where you are going” portion of the narrative.
Here are a few key things to keep in mind when telling this part of the story:
List out what you are going to accomplish with this round
While this is a “best guess,” investors want to be clear on what you plan to achieve with their capital. It’s your job to show and tell the investor what your vision is, and what success looks like for your business and their fund Don’t shy away from leveraging data, specific KPIs and milestones to give them no reason but to get excited for the trajectory of your story.
Be prepared to talk about the next round
How much do you think you will raise? If you are raising your Seed round now, consider speaking to a Series A investor to validate if your expected Seed milestones will get them excited to write the next check!
Keep in mind that things rarely go to plan, and investors know that
Be bold in your assumptions but remember it’s OK to tell an investor that your milestones are just that – milestones. Be prepared to discuss what raising additional capital as “buffer” might look like for your business. The last thing you and the investor will want is a situation where you are running out of cash right when you are hitting an inflection point.
Emphasize what is important to you from an investor
Describe what an “ideal” investor looks like to you beyond the capital.
Form a relationship. Before you think it’s impossible for an investor to get emotionally invested from one pitch – it’s not. The first pitch is like a blind date – investors can tell pretty quickly if they want to build a relationship.
A good story has a beginning, middle, and end – but a good storyteller knows it’s not always that simple getting there. You need to have a compelling enough narrative to prove to the investor that their investment will go a long way in achieving key milestones with the round you are raising capital for. How you frame your business as a story and anticipate the motivation of the VC investor is what makes the difference from a successful and a lukewarm pitch. For feedback on your pitch deck, investor pitch, and telling a compelling story, JumpStart is here to help. You can reach out to the team here.