Dear Startup Investor,
Buck Jordan here, and I’m going to talk to you about the good, the bad and the ugly of pitch decks. I’ve been an investor for a long time, and I’ve reviewed thousands of pitch decks over the years of all types, styles, and length. In that time, I’ve learned what makes a great pitch deck, what makes a good one and what makes a bad one.
Pitch decks are critical tools for startups because they let them tell their story in a condensed format (15-20 slides). Most often, startups use these pitch decks to raise capital from investors to grow their business. As an angel investor, you’re going to be reviewing a lot of pitch decks moving forward as we keep sharing opportunities with you through Angels & Entrepreneurs and more.
Here are the top traits I look for in a pitch deck that I think you should keep in mind next time you look at one.
Cover Your Bases
A good pitch deck should cover all the bases about a company – the product, team, market, go-to-market/business model, and competition. A deck is supposed to be a comprehensive overview of a company, their market and their opportunity. They should be designed so that someone who has never heard of the company before can quickly get up to speed on the business in 20 slides.
As an investor, this is usually my experience, and I’ve never heard of company x until somebody sends it my way. From there, I will review the deck and through that can understand the business and opportunity quickly and efficiently and decide if I want to pursue a potential investment.
When a startup doesn’t cover their bases, two thoughts run through my head. Firstly, I wonder about the calibre of the founders and how thorough they are. If a startup doesn’t include detailed information on the size of their addressable market, it makes me wonder how competent the founders are if they didn’t think this was important information to include.
Alternatively, it also makes me wonder if the founders are intentionally omitting some information. For example, information on competition is often the section most frequently left out of a deck. When I notice this is left out, it immediately makes me think that the startup is either playing in an extremely competitive market or that the founders haven’t even spent the time to look at what their competition is. Both conclusions are bad thoughts.
Narrative, Narrative, Narrative
The most important thing overall in a pitch deck for me is the narrative. Stories are powerful across all elements of human life – movies, books, news and even fundraising! As an investor, I want to know both your story and the story of your company. Where did this idea come from? What gave you conviction to go after it? What work have you done to validate the problem, product, and opportunity? Why are you the best person to build this company?
The team slide where you list the experience and credentials of different team members is also key. If your team all have experience in fintech startups, and now you’re building a new fintech startup, this seems like a natural evolution and the story really gels in my mind.
The other crucial piece of your narrative is answering the question of where you are going next and in the future. As an investor, my job is to invest in businesses that I think have the potential to grow into huge businesses in 5 to 10 years.
A good pitch deck helps tell a story of how your business will evolve in the years to come – what new products you will launch, what adjacent markets you will enter and what scale of revenue and number of customers you think you can achieve. This is the real special sauce of a deck and pitch from a founder. As an angel investor, I think you should invest with a long-term view.
Make it Pretty
When I first started investing, pitch decks used to be all – for lack of a better term – ugly. They were mostly made in powerpoint using some of the default templates..
It’s important to have a visually appealing pitch deck with a great order and flow because the easier it is to read and review a pitch deck, the more time someone will spend looking at it and the better they will understand the information presented.
The harder it is for me to quickly get up to speed on what problem a startup is targeting, what product they are building and what market they are in, the less likely I am to quickly get excited about talking to them and potentially investing.
Another crucial reason is that it is a signal about the work product of the company and calibre of the founders. When I see a pitch deck that is beautifully designed, with a compelling narrative and is easy to read and follow, I quickly come to the conclusion that the founders and company behind the deck are high calibre.
If they put the time in to create a quality pitch deck, it gives me the sense that they will also put the time necessary to create a quality product, a quality brand and to build a quality team. At the end of the day, the startup business is really a game of people. There is a famous saying in the startup world that goes “A players hire A players, but B players hire C players and C players hire D players.”
As an investor, you want to invest in A players. A players build the best products, build the best teams and build the best companies. A high-quality pitch deck is a sign that the people behind it are A players and that gets me excited about investing, and if it gets me excited about investing, then the chances are it gets a lot of other people excited about investing which makes a big difference for a company’s chance of success.
Talk to you soon,