1. business and industrial

Create The “Best” Startup Pitch Deck
& How to Present to Angels / VCs
By: J. Skyler Fernandes
www.OneMatchVentures.com
Introduction To The Instructor
& The Course
2
Introduction To The Instructor
& The Course
Instructor: J. Skyler Fernandes
3
Who Am I?
• J. Skyler (Sky) Fernandes
• Angel investor and founder of One Match Ventures, a
seed fund focused on technology companies
• A venture capitalist at Centripetal Capital Partners, a multistage venture capital fund
• Advisor to a number of startups
• Gave first TED Talk on Venture Capital: Innovating the
Financing of Innovation
• Founder of Missing Middle Initiative, launched at World
Economic Forum, focused on creating $10M-$75M funds
• Frequent speaker on the topics of entrepreneurship and
venture capital at Harvard Business School, New York
University, Wharton Business School, The New York
Venture Summit, The United Nations, and The New York
Stock Exchange (NYSE)
4
Why Should You Listen To Me?
I’ve reviewed thousands of
startup pitches!
I am an investor!
I know what it takes to get noticed
and get funded.
5
The “Best” Startup Investor Pitch Deck
• Every investor / pitch coach has their own idea of
the “best” pitch deck, they’re a dime a dozen
• No one ever gets it just right, as “it always
depends” on how to best present YOUR company
• However, there are core parts to a pitch that every
investor looks for and there are common
guidelines and best practices to follow
6
The Course
• The “Best” Investor Pitch Deck Outline
– Slide Template: What topics to cover
– What to include on each slide, slide examples
– Deck Variations: 5, 10, 15-30 Slides
• Personal stories and advice
• Pitch Deck Guidelines
– Formatting and frameworks
• Before The Pitch
– How To Prepare
• How To Pitch
– Presentation Skills
– Common Investors Questions / Best Answers
7
Aggregated Wisdom
Personal
Wisdom
Aggregated
Wisdom
Resources
500 Startups
Harvard Business School Angels
Arc Angel Fund
New York Angels
Canaan Partners
Reitler Law
Centripetal Capital Partners
TechStars
The “Best” Startup
David Rose
Investor Pitch Deck
8
Who Should Take This Course?
First-Time Entrepreneurs
Serial Entrepreneurs
9
The Pitch Deck Outline
& Opening of the Pitch
10
The “Best” Investor Pitch Deck Outline
0) Cover Slide
1) Elevator Pitch Slide
2) Team (If not impressive, move slide to after “Your Solution” to show who built it and why)
3) Board Members & Advisers & Future Hires (Optional, combine w/ team slide)
4) Market Opportunity: Define Market, Size & Target Client
5) Market Problem & Current Solutions
6) Your Solution (1-5 slides)
7) Traction & Awards (Optional, if none yet) (1-3 slides)
8) Market Fit / Competition (Optional, can be explained in slide 5 & 6)
9) Competitive Advantages (Optional, can be explained in slides 5 & 6)
10) Business Model: Key Revenue Streams
11) Marketing Approach & Strategy: Key Expenses / Time-Efforts
12) Financial Projections
13) Exit Strategy (Optional)
14) The Ask: Capital Raise / $ Uses / Intros
15) Closing Slide: Questions? Contact Details
5 Slide Deck: 4, 5, 6, 2, combine: 10, 12, & 14
10 Slide Deck: Don’t include optional slides
15-30 Slide Deck: Slides 1-15 + add’l slides: Market
Size vs. Target Client, Your Solution (1-5), Traction
(1-3), Market Fit vs. Competition, Marketing
Approach vs. Business Strategy, $ Raise vs. $ Uses
11
Cover Slide
• Logo / Name of Company
• Purpose of Presentation: “Investor Presentation”
• Optional: Date (if you send a deck with on old
date, you look outdated (is it taking you a while to
raise the round, mmm that’s odd), suggest never
using a date)
• Optional:
• Logos of accelerator, awards, publications featuring company
• Slogan
• Name of Presenter / CEO
12
Investor Presentation
13
Elevator Pitch Slide
Create a brief one liner that describes:
• What’s your vision? Ultimate solution for
customers/users?
• What is the Business? Service? Product?
• What’s the core problem (describe pain) in the
marketplace and the solution you’re providing?
14
What is
?
The Central Platform to
Find
Book
Pay
for All In-Home Family Care Services
The
For Family Care!
15
Team
& Advisors
16
Team
• Core Team: The Founders & Chiefs
• Photos (Optional)
• Relevant Experiences / Successes (Exits?) / Failures
(Good war stories?)
• Leadership Experience
• Education
• Don’t write sentences, use brief bullets
“We are the right team who can execute
this business plan because...”
17
Team
CEO, Jenna Fernandes
• CEO, TSR – One of the Largest Student Run Businesses in US
CTO, Jim Anderson
• Co-Founder of About.com & Solutions Architect at Spotify
Lead Programmer, Daniel Cho
• Specialist in APIs, middleware, search, data mining, booking
CFO, J. Skyler Fernandes
• VC at Centripetal Capital & Founder of One Match Ventures
18
Board / Advisors / Future Hires
• Board of Directors?
• Board of Advisors?
• Relevancy / Support, other than big names?
• State verbally: Are they investing? Big points if “Yes”
– If “No”, don’t bring it up, have a reason for why not if asked.
• Reference key holes in management or operations that
need to be filled (intros needed?)
– Few companies have the perfect team from the start, recognize
that and solve it
19
Advisory Board
David Atkins, Business Operations
• Founding Shareholder, Expedia Inc.
Greg Bohn, Sales
• Founding Head of Sales, HotWire.com
Andi Riggs, Communications & PR
• Former Head of PR, Expedia.com /VP of Communications, IAC
George Cigale, Tutoring & Partnerships
• Founder & Chairman, Tutor.com (Sold to IAC)
20
Market Opportunity
& Market Problem
21
Market Opportunity
• What is the General Market Focus?
• Name it. Size it: Units / Revenue? Growth?
• What is the Total Addressable Market
• What’s Your Target Market? The sub-sector of the General Market?
• Name it. Size it: Units / Revenue? Growth?
• Define Target Client? Key characteristics?
• Ex. Small vs. Large businesses, independents vs. agencies,
examples of ideal clients or individuals
• Clients Current Needs?
• Describe any important market evolutions and why we’re
at an inflection point now
22
Market Problem / Current Solutions
• Big Market Problem? Big Un-met Need?
• Current Solutions = Current Problems?
• Clearly show the pain of the problem or convey the strong
desire that is being unfilled, don’t just say it
• Conclusion: The market has evolved and the current
solutions don’t fulfill/solve the clients current BIG
needs/problems. There is a BIG opportunity here!
23
New Solutions: Booking Platforms
CareBooker Centralizes Family Care Across:
Booking Platforms, Agencies & Directories
Child Care
Housekeeping
Pet Care
Personal Fitness
Tutoring & Lessons
Senior Care
Quickly Scalable User Base at Reduced Costs
24
Your Solution!
25
Your Solution / Demo
• Show > Tell: ~1-5 slides of your product / service
• Show a live demo when presenting or show screen shots of
key parts (Have screen shots within presentation prepared
anyway, demo’s love to fail)
• Don’t show a video, it can fail to play and takes away from
your precious time
• Tell a story: Future client or an example of current client
• Show core value proposition to client
26
New Web 2.0 Site
27
Traction
& Performance
28
Traction / Performance / Awards
• Timeline / Key Milestones
• See other people think we’re awesome!
• Accelerator programs (we graduated!)
• Awards: #1 Best Startup / # 1 Best DEMO
• Lots of articles about us: TechCrunch / Forbes / CNN / FOX
• We’re growing fast! We’ve got lots of clients/users, some
are brand name clients, look at our monthly growth, and
we have a growing pipeline that will generate lots of $
• We’re performing amazing for clients, look at these results!
• See our key business metrics, we’re doing great!
29
Milestones
• 3,000+ Service Providers  $0 Spent
• 10+ Partners  40,000 Service Providers
• Revenue Generating
• Future: 100K Active Service Providers
= $50M+ Rev / $20M+ EBITDA
• Raised Capital From Notable Investors
• Closing Seed Round in February
30
What to say if you don’t have traction?
• We’re a startup! No Revenue yet…(What
have you built and tested? Results?)
• Potential customer feedback? (OMG - I need
this!)
• We’re growing our users…but no revenue…
(It’s the freemium model, we need capital to
market the platform, we’re doing the most
we can while we raise the round)
31
Market Fit
& Competition
32
Market Fit / Competition
• Show how you fit into the Market Landscape
• Indirect Competitors vs. Direct Competitors?
• Your biggest competitor is the status quo! Why will
customers switch to you vs. the incumbent?
• Types of Diagrams/Charts:
• Market Landscape Comparison
• Feature List Comparison
Pitch why you’re 10x better, not just 3x better!
33
Market Landscape (Example 1)
Industry Segment 1
Indirect
Competitor
Logos
Direct
Direct
Competitor Competitor Competitor
Logos
Logos
Logos
Industry
Segment 2
Indirect
Competitor
Logos
Your Logo
Indirect
Competitor
Logos
Industry
Segment 3
Competitor Direct
Direct
Logos
Competitor
Competitor
Logos
Logos
Indirect
Competitor
Logos
Industry Segment 4
34
Market Landscape (Example 2)
Co. D
Low
Co. C
Economical
Your
Logo
Co. A
Quality
Quality
Co. D
Co. B
High
Your
Logo
Co. A
Co. B
Co. C
Expensive
Discounted
Economical
35
Feature List Comparison
Company
Your Company
Competi tor A
Competi tor B
Competi tor C
Competi tor D
Competi tor E
Indi rect Competi tor A
Indi rect Competi tor B
Indi rect Competi tor C
Indi rect Competi tor D
Indi rect Competi tor E
Feature 1
Feature 2
Feature 3
Feature 4
Feature 5
Feature 6
Feature 7
Total







7
4
4
3
2
2
2
3
3
3
3





























This often makes you look 2-3x better,
not 10x, so maybe only have as an
appendix slide
36
Competitive Advantages
• Current Competitive Advantages?
• Sustainable Competitive Advantages?
• Unfair Competitive Advantages?
• Patents?
• Key Relationships / Partnerships?
• Barriers to Entry for New Players?
• Money, Time, Expertise, Relationships, Patents
• Competitor’s Competitive Advantages / Weaknesses?
37
How Do You Make Money?
Key Expenses / Time Efforts?
38
Business Model
• How do you make money? Key revenue streams?
• Pricing? Flat fee or %? Why that rate?
• Recurring Revenue Frequency?
• Is there a big difference between Gross vs. Net Revenue?
• High Volume vs. Low Volume Business?
• Example showing basic math:
• 100 Clients x A Units x B Fee = $C Revenue
• Easy to apply multiples: 10x, 100x clients
• Cash collections: Immediately? 30-90 Days?
39
Marketing Approach / Strategy
•
•
•
•
•
•
•
•
•
•
•
•
Key Expenses / Time-Efforts Needed To Generate Revenue?
Channels: How to reach / market to customers?
Strategy: How to convert, acquire or close clients?
Unique Strategic Relationships / Partnerships?
Potential for leverage or scalability to grow fast economically?
How long is sales cycle to get a client?
Expected conversion rate to get a paid client?
How to keep clients and build recurring sales?
Average Cost to Acquire a Customer?
Expected ARPU (Average Revenue Per User)?
Life-time Value of Customer?
Monthly burn rate, now vs. after funding?
40
Financial
Projections!
41
Financial Projections
• # Years Projected:
• Startups: 6 year projections (accounts for ~1 yr of getting started)
• Early-mid stage: 1-2 year historical, 3-5 year projections
• Target Market Size vs. Acquired Clients:
• Total # Clients in Target Market (Show each year with growth)
• # Clients Acquired or Free Users vs. Revenue Generating Users
(shows conversion rate)
• % Penetrated (shows entrepreneur’s sanity: growing from 0% to 1%5% penetration is usually sane, 50%-100% is usually insanity)
• High Level Financials:
• Revenue, Expenses, EBITDA, EBITDA Margin %
• Optional: Break out key revenue streams or Gross vs. Net Revenue
• Optional: Break out key expenses (Ex. # Employees)
42
Financial Projections
Year 1
14,000,000
47,542
3,402
0.02%
Target Service Provider Market
Service Providers (Users)
Service Providers (Active, After Churn)
% Market Penetration (Active)
Year 2
14,140,000
180,903
15,587
0.11%
Year 3
14,281,400
454,991
37,058
0.26%
Year 4
14,424,214
837,215
63,930
0.44%
Year 5
14,568,456
1,308,040
93,567
0.64%
Revenue
Total Annualized Revenue
$
$
647,306 $
1,611,599 $
4,708,532 $
7,802,411 $
15,184,121 $
20,992,150 $
32,632,708 $
40,339,770 $
55,162,995
63,540,712
Expenses
Annualized Expenses
$
$
1,092,011 $
1,690,658 $
4,583,543 $
5,990,906 $
11,748,537 $
12,614,351 $
21,555,679 $
19,725,236 $
32,593,302
26,342,579
EBITDA
Annualized EBITDA
EBITDA Margin
$
$
(444,705) $
(79,059) $
-69%
124,989 $
1,811,505 $
3%
3,435,585 $
8,377,799 $
23%
11,077,030 $
20,614,534 $
34%
22,569,693
37,198,133
41%
By year 5:
Revenue = $30-50M+, EBITDA = $10M+
(Investor look for exits of 6-12x+ EBITDA = $100M+ Sale of Company),
EBITDA Margins usually range 10%-40%
(Look up public companies in your industry or reports to see what is normal)
43
Exit Strategy!
44
Exit Strategy
• Acquisition: (Most likely exit option for companies)
•
•
•
•
Name potential companies (any unique relationships with them?)
Name types / categories of companies that could acquire you
Why would they acquire you, how do you fit into their strategy?
Why won’t they try to build it themselves?
• Financial Buyer: Will your company generate excess cash
flow that could make it attractive to financial buyers to
generate a return?
• IPO: The least likely exit for a company, but a possibility.
Often not preferred to founders or investors compared to
top two choices, due to required holding period and
volatility, etc.
45
The Ask:
Money & Intros
46
Capital Raise / Use of Proceeds
• The Ask: Capital? Intros? What’s the end goal for the meeting?
• Capital Raise:
• Stage / Size? Ex. Seed Round: up to $500K, Series A: $2-3M
• Investment Terms: Ex: Pre-Money Valuation Expectations / Range, Discount into next
round?, Valuation Cap?, Dividend / Interest Rate?, Liquidation Preferences?
• Current Investors in Round: Founders, Key Angels, VCs
• Monthly Burn Rate? / How long will new $ last (runway)?
• Prior Investment Rounds: Size? Investors? Valuation? Key Terms?
• Use of Proceeds: (Name It / $ Amount / % of Capital Raised)
• Sales & Marketing
• Hire key employees
• Founders salaries (Don’t be greedy!!!)
• Build out / further develop technology
• File patents
• Achieve Milestones: 1st Client? Get to Breakeven? 3x Rev Growth?
47
Right Type of Investor for Your Startup
• Angel
• Venture Capital
• Private Equity
48
Closing
49
Closing Slide
• Your Logo (Big & in Middle) / Link to site
• Any Questions?
• Contact Info: Name / E-mail / Phone
After all questions have been asked by the investor, ask
“What’s the next step in the process?”
Remember:
Goal of Meeting =
Get the Next Meeting
50
Appendix Slides
51
Example Add’l Slides / Appendix Slides
• Timeline: History, Milestones & Prior Funding
• Detailed Value Proposition to Clients / Users / Partners
• Detailed Financials: Revenue and expense breakdown, showing % of total revenue / expenses
• Average Revenue Per User (ARPU)? Per Client Size?
• Life-time Value of Customer (Churn Rate?) vs. Cost to Acquire Customer
• Breakeven Analysis: Base-case vs. Bare-bones case. # Clients / $ Revenue needed?
• Pipeline of potential clients, % likelihood of closing, revenue potential from pipeline
• Partnership Agreements / Structures
• Proprietary aspects not discussed in core deck
• Additional Strategy Slides: Ex. Architecture, How to avoid/limit circumvention, Funnel system of
business operations, Growth strategy
• Capital Structure: Ownership of founders & current investors
• Competitors Capital Raises / Investors
• Head Count ( # Employees) Projections / Key Hires Needed
• Additional Screen Shots from Demo
• Summary Slide: Why We’ll Be Successful (Add if deck > 15 slides, otherwise too redundant)
52
Pitch Deck
Guidelines
53
Slide Deck Variations
• Suggested Core Slide Deck: 15-30 slides
– See “The “Best” Pitch Deck Outline”
• There are no correct # of slides, only key
pieces that need to be covered
• Typical Deck Variations: (30 secs/slide)
– 2 min (5 slides)
– 5 min (10 slides)
– 10-20 min (15-30 slides)
54
Keep It Clean
• Keep slides clean, no clutter:
~1-5 bullets per slide
~5-10 words per bullet
Big clear images
55
Show, Don’t Tell
• Don’t be cocky/braggy/hyperbolic!
Show
AWESOME
AMAZING
Results!
56
Keep It Simple Stupid!
• Show “super simple” images,
graphics and diagrams (that
need little to no explanation)
57
Key Takeaways
• Concisely summarize main points
at the top or bottom of key slides
(not all slides)
58
Simple & Self-Explanatory
• Deck should be simple / clear enough to
explain itself and not need you to present it
• When presenting have add’l info/insight to
share with each slide = Your “added value”
59
Errors! Inconsistencies!!!
• Check for typos
• Math errors
• Internal inconsistencies
(# widgets slide A vs. slide B)
60
Consistent Formatting
No right or wrong way, just be consistent!
• CAPS vs. lowercase
• Colors
• Font Type / Font Size
• Line Spacing, etc.
61
Font Type
Arial (No odd looking letters)
= Easy to read: g, Q, y
Times New Roman: g, Q, y
Calibri: g, Q, y
Wingdings:g,q,y
62
Font Size
Only use font size 20 or larger
Size 40: Otherwise too hard to read
from a distance
Size 30: Otherwise too hard to read from a distance
Size 25: Otherwise too hard to read from a distance
Size 20: Otherwise too hard to read from a distance
Size 15: Otherwise too hard to read from a distance
Size 10: Otherwise too hard to read from a distance
63
Bullet Styles
Don’t use dashes “-” as bullets,
they look negative,
use other styled bullets
64
Page Numbers
Add page numbers (Bottom right of page)
65
Background Slide Color
Dark backgrounds with light text colors project well
(kills printer ink, but who prints?)
You can also use white backgrounds with
black / dark color font
66
Before the Pitch
67
Warm Intros
• Get introduced to an Angel or VC,
investors don’t respond well to
random calls/e-mails
68
Know Your Investor!
• Review investment criteria of Angels / VCs
before sending investor deck
• Industry focus
• Energy or business type focus (B2B / B2C)
• Size of capital
• $250K? $1M? $3M+
• Company stage
• Startup / Early Stage / Growth Stage, etc.
• Required financial metrics
• $1M in revenue or EBITDA
69
Know Your Investor!
• Review portfolio companies of Angels / VCs
before sending them your investor deck
• Conflicts: Investors don’t invest in companies that
compete directly with a portfolio company (shocking!)
• Secrets: If you send your deck to an investor with a
competing portfolio company, it will be shared with them
• Get Clients / Partners: If there are strategic companies
in their portfolio, they can make introductions to them
even if they don’t invest, such as potential clients,
strategic partners, future acquirers, etc.
70
Who are you meeting?
• Review investor backgrounds to find
useful overlaps or who best to speak
with at fund
• Do they know the sector lingo?
71
The Ask?
Why are you meeting?
$$$$$$$$
Intros?
72
Practice, Practice, Practice!
•
•
•
•
•
Flow of presentation / Slide transitions
Timing
Clarity of concepts / mental frameworks
Key stories
Answers to likely questions
73
Arrival
• Arrive 10 minutes early
• Need time to set up computer,
projector, get access to Wi-Fi, etc.
74
Attire
• Business casual is fine, no need
to wear a suit, unless you want to
• We’re Angels / VCs, not Bankers!
75
You’re on a Date!
•
•
•
•
Be Nice, Be Impressed, Cater to EGO
Ask investors in meeting to be introduced
Provide a quick background on themselves
And the fund
You may just learn something!
And people love talking about themselves!
76
Various PDF’s / 1 PPT
• Prepare various presentations (PDF’s) using 1 PPT file
with all core slides and appendix slides
• 1) 1st Meeting PDF: Send Core Slide Deck (No Appendix
Slides), when presenting use PPT so you can access
appendix slides during Q&A if needed
• 2) Follow-up Meeting PDF: Additional slides (they may
have requested you to create) and some appendix slides
• 3) Full Due Diligence PDF: All slides and all appendix
slides (possibly requiring NDA) (This is usually once they
have drafted a term sheet)
77
How to Pitch
78
Opening The Pitch
Open by saying:
Your Name, Title/Role, & Company Name
Allows audience to get familiar with your
voice before you start pitching,
and it’s just polite!
79
The Quick Hook
• Grab the emotional attention
of the audience within the
first 1 min
80
Offer The Excitment
Pitch your vision (What You Aspire To Be),
not just what you currently have or are
Never let the facts get in the way
of a great story!
81
Tell A Story
Vocally take your audience on an exciting
upward journey with smooth transitions
82
Common Language / Understanding
• Don’t use industry acronyms /
terminology, or reference
companies they won’t know
• Don’t make people think or
question you statements
83
Validators
• Show real validators to prove
your points, supported by
strong emotional validators
84
Be Likable + Professional Qualities
• Good person (a good friend, fun / smart)
• The Right Team: Qualities - Integrity,
Credibility, Passion, Experienced,
Knowledgeable, Skilled, Leadership,
Confidence, Commitment, Visionary,
Realist, Coachable, Doers
85
One Joke
• Make audience laugh at least once,
but don’t do a comedy routine
86
Time vs. # Presenters
• <10 min presentations
– One person presents, the CEO who
can sell
• >10 min presentations
– One or more people present
87
Visual Engagement
• Don’t read slides or stare at
projector screen!
• Look forward / connect with your
audience
88
Speak A Little Slower Than Normal
• Don’t speak too fast, people listen
better when you speak slower
• And you sound wiser!
89
Videos
Don’t show a video
Do show a quick DEMO or screen shots
(pictures fail less often)
90
Top Investor
Questions
91
Top Investor Question & Answers
•
•
•
•
•
•
•
•
•
•
•
•
•
•
When did you start raising the round?
How did you meet/find your team members?
Why did you base your company here?
Why did you create this company?
What’s your objective with creating this company?
What’s your valuation? Terms?
Have you invested any of your money? Other investors?
Are your advisors investing?
What keeps you up at night?
Are you a starter or finisher?
Target market size? Market penetration?
Traction?
Monthly burn rate and how far money will take you?
Use of proceeds and expected results?
92
Words of Wisdom
93
Words of Wisdom
•
•
•
•
•
No right number of slides!
Be 10x Better, Not 2-3x Better
Prepare yourself for your rejection, learn and ask
There are lots of great ideas, few can execute
Time is your biggest enemy! Built quick and cheap,
and iterate, iterate, iterate…pivot when needed
• Biggest Competition: Other companies with great
ideas, great teams, with more traction at your stage
• Best Opportunity: Big Growing Market, Big
Problem, Simple Solution (not overly complicated)
• You don’t know, the market does! Ask often.
94