19 Sep The Basics of a Pitch to Potential Investors
8 Things to Include in Your Presentation
I have developed pitch decks for pre-revenue companies as well as heard pitches from companies seeking early stage funding. In listening to presentations, I often find that critical information is missing, which makes it difficult to understand the overall vision and opportunity. Here are the things you must communicate in order for potential investors to have the basic information they need:
What is your product?
Your pitch should make it very clear what you have developed or are developing to take to market. Assume your audience knows nothing about your product and keep the description straightforward.
What problem does it solve/what is the value?
Be explicit in describing the problem you are solving and the value of solving the problem. For example, if you are proposing a competitive product that is more energy efficient than other solutions on the market, indicate not only how your solution is more energy efficient, but explain why the customer cares. For example, does it ultimately save them money?
Who is it for?
Make it clear who your target customer is as well as who is the end-user of the product. In some cases, the end user and customer are the same. In other cases, you may be providing a solution to companies that will offer the solution to their customers. The relationship between your product, the customer and the end-user should be spelled out.
How big is your target market?
Ensure you have an idea of how many addressable target customers exist for your solution. Investors will want to understand the size of the opportunity. In order to make this assessment you need to define the profile of your target customer (i.e. small hotel chains in the US). This profile may evolve over time, but you want to have an initial stake in the ground.
Who are your competitors?
Provide an overview of the competitive landscape. Are you competing against existing products or perhaps manual processes? You want your audience to have an understanding of the competition and how you plan to differentiate from existing options.
What is your pricing strategy?
Lay out your proposed pricing strategy. It may be something that changes over time, but it should be clear what your idea is as well as your rationale for this pricing. For example, if you are serving the smb market you may have chosen pricing that will appeal to a more cost sensitive customer.
What is your go-to-market strategy?
Will you be selling directly to customers? If so, how do you plan to market and sell your product? For example, will you use sales reps or sell your product online? If you plan to sell through partners describe the partner ecosystem.
How much revenue do you project to make?
Based upon the above information, develop a sales forecast. At this early stage you will be making assumptions to build out the forecast so include these assumptions along with the numbers. The forecast will change as you move forward, but these projections help the potential investors get a sense of the opportunity.
I realize your business will change over time and your proposed solution and even target market may evolve. But it is critical to be able to paint a clear picture of your vision so that your audience “gets it”. Ultimately, potential investors have their own unique criteria for how they choose to invest. However, if you provide them with the information above, you will have the basis for a productive discussion.
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