I Stared at Startup Pitch Decks for 3 Straight Weeks – Here’s What I Learned
Reblog from NextView Ventures' Blog - February 25, 2015 - A few weeks ago, we launched two startup pitch deck templates for raising seed capital — part of NextView’s platform of exclusive startup resources. And while the NextView partners served as the editors and directors of the project to ensure its usefulness to founders, I wanted to share a few of the more surprising or alarming lessons and trends I witnessed after spending weeks of my life staring at actual pitch decks from dozens of startups to inform our templates.
Some of these lessons might be useful because I’m not the founder who created those decks. Sometimes, when you’re too close to a task or challenge at hand, you miss the obvious. You lose the forest thanks to all those damn trees.
Other lessons I learned might be useful because, well, how often does someone spend hours upon hours of their waking life comparing and contrasting pitch decks? I wasn’t evaluating companies, mind you, but the decks themselves — nitpicking every little design and layout element to borrow and adapt and inform our project. How often does that happen? (Answer: Never, because that sounds like what a crazy person would do. But for three weeks, this was my world. As an aside, please send coffee. I’m still recovering.)
So, begging for your sympathy aside, here are the biggest things I learned after sorting through pitch decks and re-building the wireframe from the ground up. In sharing them, I hope you can create a deck that’s better informed, more compelling, and more effective at raising capital for your venture.
5 Surprising Mistakes Found in Seed-Stage Startup Pitch Decks
#1: Founders Often Miss the Most Important Slide
The first thing that jumped out was just how often decks lacked a clear, over problem statement. “THIS is why we exist. THIS is what we aim to solve. THIS is why customers will care.”
You can make the case that the “what we do” slide is the most important, but in the seed stage, the exact details of the product and even the target customer is a moving target.
Instead, I’d argue that the most critical slide to include early in the deck is a succinct, jargon-free problem statement. The “what” and “how” are still being developed, though you will obviously include some of those details in the deck. But the “why” of your company is absolutely essential.
The “why” is about two things:
- Explaining the market opportunity. Why will your customers care about your company? Is this a really big problem right now? Is it only growing as a problem/opportunity? Are there other solutions that exit but fall flat, thus putting you in a position to win?
- Validating you as the founder. Why are YOU out to solve this problem? Why do you care? Are you authentic as a founder who’s hell-bent on solving this issue? Will you run through inevitable future brick walls because you care so much, or did you just spot a weakness in a market and may not be overly passionate? In short, what’s your unfair advantage to gain traction and distribution and start to solve this particular problem?
It can’t be overstated — stating this clearly and early is crucial to the success of your pitch, whether you’re pitching investors, customers, or potential new hires.
#2: Type-A People Try to Cram Too Much Information onto Every Slide
If you were a Type-A student and always over-prepared for tests, then you’re likely to struggle with the copy and layout of your pitch deck a bit more than other founders. That much was clear when reviewing all the various types of decks I used during my research and matching them to my perception of a given entrepreneur.
I am that Type-A person too, so take it from me: On a single piece of paper, write down the main point each slide tries to make. Then add exactly those points to the slides. Leave the color commentary to the slide notes or appendix.
Good pitch decks are clear, concise, and contain only the most critical information … not ALL information. It’s hard to avoid if you’re this type of person, but don’t feel the need to cram in every single detail about your company. Nor should you stuff tons of copy onto a single slide.
Again, like the above mentioned “why” slide, this clarity and focus is also great practice for selling your product to customers.
#3: Claiming You Won’t Need Future Funding Is Actually a Mistake
I always believed that, were I to found a company after NextView, I’d say exactly that. I’d simply raise a single round then never fundraise ever again.
Not so fast. As it turns out, claiming that you’ll never need another round after your seed financing can hurt your credibility as a founder. A lot of the reasons why are implied, not stated, simply by you raising capital at all. First of all, if the business is destined for greatness, you’re likely to want future capital to step on the gas. Additionally, by raising institutional capital, you’re implying that high growth potential is the name of the game. It’s much different than a friends and family round or even an angel round in some cases. When raising from a VC, you’re signaling that you’re trying to maximize growth and returns.
#4: Many Decks Fail to Mention a Distribution Strategy
In our templates, this information can be found on the Go-To-Market slide, which has its own dedicated explainer slide ahead of it just because it’s so critical. The slide itself — and the reason it was a surprising lesson learned after my time staring at these decks — both point to one reality: Many founders focus too much on the tech rather than how they’ll actually get that tech into the hands of customers. (Some decks did include this fact made the mistake of citing very broad generalizations. “Content marketing” is not a go-to-market strategy.)
I need to acknowledge that the lack of info around distribution could be due to the number of Boston based startups I reviewed. It’s a common knock that Boston entrepreneurs think about tech and tech alone and fail to articulate how they’ll generate demand. (I personally disagree and think that this is a gross generalization of Boston-based marketers and entrepreneurs. As an aside, I believe the area’s founders are actually very good at targeting customers, but lousy at targeting tech press and larger, splashier goals. And for that reason, the tech press believes they lack good marketing chops overall.)
As NextView’s David Beisel likes to say, “We live in a demand-constrained world. Tell us how you’ll combat that issue when you launch.”
Show you’re thinking about distribution, and even better, show you have an unfair advantage for gaining traction.
#5: Many Founders Share Decks in Editable Files, Ruining All Design
Many of the decks sent to me by the NextView partners were originally shared in PowerPoint. These are editable files and can cause disastrous perception problems — namely, the design, layout, fonts, and alignment of all slides can suddenly appear incredibly sloppy.
This is an easy one to avoid: Send a PDF. It’s that simple. As a bonus, you can hyperlink to things in PDFs through Adobe Acrobat Pro that are instantly clickable, compared to PowerPoint-based links.
(It’s worth noting that our pitch deck templates are indeed built in PowerPoint in order for you to download and easily edit the slides. But if your operating system or specific edition of PowerPoint causes any design issues, check out our SlideShare account for two PDF versions you can view alongside the PowerPoint as you edit.)
#6: More Than Half of All Pitch Decks Weren’t Framed as a Story
We believe telling a compelling, authentic story is so critical that we built a template called “The Show” which is quite literally a story-telling deck. Even if you don’t use that version, you can still adapt the framework of good storytelling into your more straightforward pitch deck.
The Show template aside, the pitch decks I studied were mainly fact-based flipbooks of copy and graphs. But the biggest realization I had while working with NextView’s partners on this project is that, in every case, you’re better off telling a coherent, compelling story about your company and where it’s heading.
Luckily, every story from nursery rhymes to Shakespeare to stellar startup pitches can be distilled into three parts: a status quo, some conflict, and a resolution.
This is the absolute best way to tell your own story and pitch your company. Gone are the days of transactional, slide-by-slide pitches being the most effective option. Investors make decisions with their heads and their gut instincts. You need to target BOTH.
And for a step-by-step template for doing exactly that, as well as compiling either of two effective startup pitches, I invite you to check out our startup pitch deck templates.
Best of luck telling your startup’s story.