Up until 2023, it was easy to believe that there’s a template that works for investor pitching.
But when investments are no longer in abundance, you need to pitch differently.
You need to go above the noise and penetrate the attention threshold.
Think about it like a parent.
If you have money and your kids are asking for toys, it’s easier to say yes. But if income is tight — like many tech individuals who were affected by massive layoffs — then there has to be a good reason to spend money.
Over the next few minutes, we’ll look at how you can create that good reason for investors to invest. But first, a quick note on why you should avoid traditional pitch deck templates.
How traditional pitch deck templates dilute your story
I could easily give you my 10 things I hate about … templates, but let’s just focus on one.
Pitch deck templates tell you WHAT to present with a predefined list of copy-and-paste sections:
- Introduction
- The problem
- The solution
- Demo
- Benefits
- Traction
- Market analysis
- Trends and opportunities
- Business model
This boxes your ideas and energy into a predetermined flow. And it doesn’t work in today’s market.
Rather than asking yourself WHAT you need to present, ask yourself WHY the potential investor should listen.
If you want to keep your investors tuned in to what you have to say, avoid the pitch deck template and start thinking in terms of the pitch cycle.
Introducing the four-part pitch cycle
The four-part pitch cycle harnesses the power of storytelling and your product to take potential investors on a powerful journey.
Delivering your pitch isn’t just about delivering information, it’s about maintaining attention from start to finish.
Let’s look at each step one by one.
1. Capture imagination
Investors can determine whether they’ll invest within the first five minutes of a conversation. So capturing their imagination right from the start is key.
Here, you’ll give a brief personal introduction. Then you’ll dive into your company’s purpose and a purposeful, real world story to land the problem and solution, together.
This allows your potential investor to truly imagine themselves in your world rather than being presented it, creating a strong personal connection that you can carry through your pitch.
2. Introduce the opportunity
Once you’ve created a connection with your investor, you’re ready to articulate the business opportunity.
In this part of the pitch cycle, it’s critical to:
- Define the value proposition of the product in relation to your purposeful story
- Give an overview of the product (a demo is a nice-to-have, but not essential)
- Demonstrate why and how your product is scalable
And if you really want to keep your investors listening, remember this: avoid out-of-this-world numbers.
Cut the gazillion dollar TAM slide and focus on showing why your product has commonality in simple terms — and why every company in your vertical will want to use it.
If you do that right, your investors will be running the numbers in their heads before you even get to part three.
3. Drive the business argument
This part is all about answering one simple question: why you?
Take the time to showcase why you are the right person (or people) for the job. Give an overview of your team, your business traction, the competitive landscape, and why you’re poised to win in that space.
And don’t forget: when you position yourself in the top-right corner of the competitive landscape chart, make sure you can answer very simply and concisely why you’re there.
If you can’t define it in a short paragraph, you need to zoom in further on the details of your value proposition.
4. Ask for investment
In early-stage fundraising, the fourth and final part of the pitch cycle is also the most important.
Let’s be honest, most early-stage companies don’t know exactly how they’ll use every dollar of the seed, A, or B funding that they’re asking for.
So, in your first meeting with an investor, I would avoid ending the meeting with a direct ask for the total investment amount. Instead, ask for their interest.
Here’s a quick example: “If you’re interested in learning how we plan on allocating the $4.5M Series A round investment, I’d love to walk you through a plan that will set our company on a trajectory to scale.”
Let them verbally say: Yes, I am interested.
Final thoughts
It’s a well-known fact that the purpose of the first meeting with an investor is to secure the second meeting.
Likewise, the purpose of the first five minutes of your presentation is to grab the investor’s attention and make them want to listen to you for the remaining 40 minutes.
By using this four-part pitch cycle, you can make sure they stay tuned in right to the end.
Originally published on Medium