Over the past year, I’ve worked with about half-a-dozen early stage start-ups as they move on to try and secure series A VC funding. At this stage, though it may need refining, everyone has their elevator pitch. Their biggest problem tends to be with their slide deck.
And every deck has the same problem: it’s too big. I’ve seen decks that run from 40 slides all the way up to over 100. And that’s just preposterous. Just as VCs see hundreds of business plans, they get 100s of pitches. Their time is valuable. And if they’ve agreed to meet with you, they already have a basic understanding of what it is you’re trying to accomplish — now all you’re trying to do is close the deal. So, how many is the right number of slides? I’m tempted to say you only need one.
You see, VCs only really care about two things: the market opportunity, and the team. Specifically, whether or not your team will be able to tackle the market opportunity. So, since the team is there doing the pitch, you really only need one slide to address the market. The team aspect will be addressed by how well you handle yourself explaining that one slide.
Of course, very few people are going to go in and pitch a VC with just one slide. If I had one piece of advice to give budding entrepreneurs on their first VC pitch, it would be this: fewer is better. In fact, I’d say a hard and fast rule is never have more than ten slides.
Ten Slides
In an effort to help you focus your thinking and condense your presentation down to those ten key slides, I thought I’d put together a little outline. Of course, following this outline is in no way guaranteed to get you funding — you still have to convince the VCs of the market opportunity and the team; you have to sell them. But if it does nothing else, hopefully it will help you clarify your thinking. Then, over time, you can refine the pitch and modify as necessary. But first, start with condensing.
Slide 1 — The Executive Summary
As with all executive summaries, you should write this last. First, go put your other nine slides together, then come back and write this one. But when you do write this one, it should actually be a summary: what is the market opportunity, what is your business actually going to make or deliver, who is the team, and for what are you asking the VCs?
Slide 2 — The Market Opportunity
Of course, the VCs have already read your business plan, so they have a high-level understanding of the market opportunity. But this is your chance to really sell them on it. How big is the opportunity? What makes you think it’s that big? And most importantly of all, what is the discontinuity of which you’ll be taking advantage? If you can’t articulate a clear technical or market discontinuity, you’re not going to get much farther.
And one important note: obviously you need to be going after a big market opportunity, but be very reasonable in your estimations. As soon as you’re done with your pitch, if you’ve convinced the VCs, the first thing they’re going to do is go have their analysts analyze. The analysts are going to come back with at least three numbers: a minimum, a maximum, and a reasonable best guess. If your market sizing is too far off the analysts’ number, that’s going to reduce your credibility. You’re presumed to be the experts here; if your numbers are too far off, the investors will have a hard time believing everything else you say.
Slide 3 — The Team
Often, you’ll see a slide deck that ends with the team — and frequently, with many slides on it; perhaps as many as one per team member. Don’t make that mistake. Introduce the team to the VCs up front. Introduce the key members, and instead of putting even a brief bio in for each one, include the salient points that are going to convince the investors that this team has what it takes to tackle this market.
Slide 4 — The Vision
Now that the investors know the market opportunity and the team, take the time to sell them on your vision. Paint a bold picture of what you’re company will look like two years from now. What are you going to build? How is it going to transform the market? How is it going to take advantage of the discontinuity you’ve found and truly dominate?
Slide 5 — The Competition
With the market and the vision covered, it’s time to talk about the competition. Who else is in the space directly? What about in adjacent spaces? If there are no large companies in the space, who are likely candidates to come in and pose a threat? (And remember, those same large companies that can threaten you are also potential acquirers down the road as you look for a liquidity event — but don’t focus on this too much. The VCs will understand that, and are primarily interested in investing in the long term. They’ll look at liquidity events if and when they arise, but it shouldn’t be your focus this early in the conversation.) What other start-ups have been funded in the space? (And again, while they’re competition, they also serve to validate the market.)