Key Takeaways
1. Purpose of the Pitch
- The goal is to make the pitch concise and easy to understand, especially for pre-product market fit companies.
- Avoid unnecessary jargon and complexity; clarity is more important than 100% accuracy.
2. Essential Components of the Pitch
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What Do You Do?
- Describe what your company does in two sentences.
- Provide a specific and relatable example.
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Team
- Highlight who is on your team, their roles, and their impressive accomplishments.
- If possible, show how team members have personally experienced the problem you are solving.
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Traction
- Share what you have accomplished since starting your company.
- Use graphs only if they show positive trends.
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Unique Insights
- Discuss the non-obvious things you have learned about the problem, customer, or solution.
- Make sure your insights are unique and well-supported by facts and examples.
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Market Size
- Explain how you calculated your market size, including the number of potential users and pricing.
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The Ask
- Clearly ask for the amount of money you need and specify what milestones you aim to achieve with it.
- Discuss what you plan to accomplish rather than detailing who you will hire.
3. Common Mistakes
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General
- Leaving the audience unclear about what the company does after the first slide.
- Using distracting slides that draw attention away from the speaker.
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Specific Slides
- Team Slide: Not including titles, specific roles, and notable achievements.
- Traction Slide: Including irrelevant or non-impressive work, providing no timeframe for accomplishments.
- Market Size Slide: Not showing math or comparable products.
- The Ask Slide: Failing to ask for money or not specifying what the funds will achieve.
4. Presentation Style
- Order your points from most to least impressive.
- Engage investors in a conversation rather than delivering a monologue.
- Pay attention to investor reactions and be ready to shift the focus if they show interest in specific points.
- Keep slides visually simple to keep the focus on the speaker, not on the design.
5. Practical Example: Pitching Y Combinator
- What They Do: Startup accelerator, investing $500k and supporting through a 3-month program.
- Example: Personal story of founding Twitch and benefiting from YC.
- Traction: Over 75 companies generating more than $100 million in revenue.
- Team: Partners with experience in starting and running startups, who joined YC.
- Unique Insights: Application process without warm introduction, batches providing mutual support, and higher valuations at demo day.
- Market Size: Related to the number of tech IPOs and the returns they generate.
- Ask: Clearly asked for money with specific goals and milestones.
This concise approach and these tips can help founders create effective pitches that resonate with investors and increase their chances of securing funding.