Investors seek information on three aspects from a startup's pitch deck
By Prajakt Raut - Founder Applyifi
Applyifi helps startups refine their business plans and investor pitch deck [www.applyifi.com].
It is important for founders to understand that how a business makes money and how investors make money on that business are quite different. Broadly speaking, a business makes money when its revenues are more than the expenses. However, investors do not make money that way. Investors invest money in your venture, and buy equity. They make money only when they are able to sell that equity to someone else at a significantly higher price than what they had bought it at.
Quite often we see high-quality teams with brilliant concepts/products/services pitch to investors without understanding how the business of the investor works, and therefore often end up presenting stuff that does not help investors make an investment decision. (Even if the decision is no, it is best that you get it out from them the soonest).
Investors are interested in the business around the product or service… not just details of the concept or the product. A product is not the same as the BUSINESS for that product. E.g. for someone presenting for a e-tailing venture, the investor would be interested in knowing your competencies or plans on supply chain, warehousing, procurement, customer acquisition, etc. Not just about how cool your web platform is or that “No one is currently addressing this market and hence it is a good opportunity”.
Most entrepreneurs make the mistake of diluting the pitch with a lot of detail of the operations, which of course will be of interest to investors… but only after and only if they have an interest in participating in your journey.
Most investor’s decisions are based on the following:
If the above two are positive, then the following few areas would be discussed:
Hence, an investment pitch deck should the following:
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