You have broken down the barrier to entry and are lucky enough to have the opportunity to present to potential investors. How do you make sure you are prepared and make the best impression? We’ll give you some of our insider secrets. After watching hundreds of hopeful companies present their companies in hopes of gaining funding there is one thing that is very clear. Entrepreneurs tend to make the same mistakes when they make presentations to investor groups. If you can avoid these mistakes you will instantly set yourself apart from the pack of presenters.
The first thing you have to remember is that these presentations are intended to provide an introduction to the business venture and an explanation of the investment case.
The first thing you have to remember is that these presentations are intended to provide an introduction to the business venture and an explanation of the investment case. Think of it like a court case. The burden of proof is on you and you are making a case for your company’s story. It’s important to state the reasons why an investor would be more interested in this company than any other.
There are a few key elements to any company that potential investors want to know: business concept (product or services), management, scalability, profitability and stickiness factor. All of these elements work together to build a strong investment case. In simple terms, tell the investor what you do and how you make money. The business concept is also known as the ‘elevator pitch’. Take a good look at the key players in your company’s growth model; you’ll want to highlight these people and their backgrounds along with their role in your company. Scalability refers to the growth potential for your business and how you plan to accomplish that growth. Has your company made its first million? How do you intend to grow sales over the next 2 to 3 years?
Another important aspect of the investment case is profitability. For every widget you sell for $10, it costs $5 to make and $2 in overhead. Therefore, your company’s net profits are 30%. Investors are interested in profitability because this ensures that the company will be able to provide returns to the investors. Finally, stickiness is an intangible yet potent factor to keep customers coming back to your company for more products and services.
Almost as important as the information is demeanor. Many entrepreneurs are so nervous and overworked that by the time they get to present to a group of potential investors, their presentations come across dull and lifeless. Investor presentations can, and should, be fun and exciting. Be prepared by having your materials ready several days before your presentation and get lots of rest the night before you actually talk with investors. Remember, this is your passion, so make sure to share your passion for what you do.
Below is an specific outline for your investor presentation slide deck:
- Opening Slide:
- Logo and company name
- Contact information (full name, address, phone numbers, e-mail & website)
- The Product (1 to 2 slides):
- Brief explanation of product and its key features
- Include product pictures
- Avoid being too wordy – keep it simple and clear
- The Deal (1 slide)
- Founder’s investment amounts
- Amount of funds being requested
- Projected potential business value of company
- Industry Overview (1-2 slides, graphs are recommended)
- Build up the industry
- Use facts that promote its continued growth
- Simple, simple, simple
- Management Team (2 slides max)
- 1-2 brief phrases on each key team member
- Hit key points that demonstrate their strengths as they relate to the current company
- Board of Advisors (2 slides max)
- 1-2 brief phrases on each member
- Hit key points that demonstrate their strengths as they relate to the current company
- Our Customers and Target Market (1-2 slides)
- Include last month’s sales numbers
- Promote market strength
- List out targeted customer groups and why
- The Competition (1 slide)
- List 2 competitors and their strengths
- Explain your advantage over them
- Marketing Strategy (1-2 slides)
- List out various strategies
- Make it seem easy to accomplish
- Operations (1 slide)
- Basic facts
- Office location
- Number of staff
- Financials (1-2 slides)
- Revenue forecast – insert a chart
- Gross margin
- Net profits
- Exit Strategy (1 slide)
- Brief description of how and when you plan to exit
- Examples of past similar deals