In the world of startups, securing investment is crucial for success and unfortunately, many startups fail to secure investment due to common pitch deck mistakes. Let’s explore some of the worst mistakes that could potentially make you miss your golden ticket to take your startup to the next level. And who better to explore those mistakes with than actual investors?
This article is based on a conversation between Heini Zachariassen, founder of Vivino; Suranga Chandratillake, general partner at Balderton Capital and Olga Maslikhova, Venture Capital Investor. The video is embedded below and the article continues under the video.
#1 No “Why now?”
Timing is everything and you have to be able to answer the question “Why now?” A critical component of any startup, bad timing can lead to massive failure, so you have to be able to prove to your potential investor that now is the time to invest. If there’s one repeating component that will always make the list of why startups fail, it’s timing.
It’s a challenge - you want to be early enough that it’s not yet obvious to everyone else, but not too early to the point where there’s no infrastructure. Easier said than done, you have to find that sweet spot.
#2 Unrealistic financial forecasting
Balance is important when it comes to financial forecasting. While you don’t want to be too conservative and run the risk of simply being too uninteresting to invest in, you really don’t want to come across as unrealistic either. You can quickly come off as ill-prepared and naive.
When you set unrealistic financial goals or forecasts, it shows that you don’t really understand your business. So, while it is essential to have a compelling financial forecast, it shouldn’t be overly optimistic, as investors will quickly lose trust in you and your startup.
#3 No page numbers
This one may be slightly silly, but at least it’s an easy mistake to fix - not including page numbers. Though it may seem trivial, it makes a big difference for investors who want to quickly navigate through your pitch deck.
For many VCs, this is really a pet peeve - and understandably so! When they’re working through a pitch deck, sharing it with colleagues and chatting about it via Slack or email, not having page numbers makes it incredibly difficult to point to different slides of the deck. And one thing is for sure, you don’t want to make it harder for VCs to review your deck.
#4 Saying there’s no competition
The fourth mistake is saying there is no competition - this can make you seem naive and inexperienced. Investors spend 51% more time on the competition slide than any other slide, according to data from DocSend.
When you don’t have a competitor slide, there are three things running through a potential investor’s head. 1) it’s true, you don’t actually have any competition, in which case you should still have a slide showcasing you’ve done the research. 2) you have competition but are too scared to mention them. And 3) you haven’t done a proper analysis - this is the worst-case scenario. Having a competition slide builds your credibility and shows you know the market well.
#5 Deck is not self-explanatory
The fifth mistake is having a deck that is not self-explanatory. Your pitch deck should not require a voice-over or to be presented. Most of the time, a deck is passed around and viewed by people who have never met the founder. It is essential to have enough text on the slide for anyone to understand the message.
If you like your slides to have fewer words, you can use a lighter deck for live presentations that you never actually share with anyone.
#6 No go-to-market plan
The sixth mistake is not having a go-to-market plan. You cannot assume that customers or users will come to you, no matter how good you think your product may be. You need a plan to attract and retain customers.
And don’t just copy what everyone else is doing. In the startup world, there will always be companies with more cash than you, so you must find a clever, creative and cost-effective way to show you can scale.
#7 DocSend with no download option
The seventh mistake is using Docsend with no download option. This is another incredibly easy fix, so be sure to do it. DocSend is a popular platform used by startups to send out pitch decks and if you are using it to send your deck, ensure that there is a download link available.
From my experience, investors have strong feelings about this one. They may want to review your deck offline or share it with colleagues, and you really don’t want to be limiting them. Additionally, starting a relationship with trust is crucial for investors. When you don’t give them the download option, you’re signaling that you don’t trust them. Not a great way to start off with an investor.
#8 Don’t talk enough about the team
The eighth and final mistake is not talking enough about your team. It may sound cliche, but people invest in people, not products. The team is one of the most critical components of a startup in the early stages.
Investors want to know who is behind the startup and their experience. In the early days of a startup, most things within it are not yet real, i.e. projections of financials, the vision of a product, and a narrative about scalability. One of the only things that are real is the people who will execute it. Investors want to know who they are working with, what experience and expertise they bring to the table, and why they are the best team to execute the idea.
In conclusion, getting the easy stuff right in your pitch deck is crucial. Investors have many startups to choose from, and sometimes the margin is very tight. You don’t want to miss an investment because of an avoidable mistake. Pay attention to the details, do your research, and make sure your pitch deck is self-explanatory, easy to navigate, and has a clear message.
Remember, convenience for the investor is key. Ensure your deck can be downloaded, has page numbers, and explains your startup's message clearly. With these basics in place, you can focus on the more complex challenges.