In the six months since joining the VC world as an MBA Associate, I’ve reviewed over 100 early/seed stage pitch decks from startups in the Chicagoland area. A company’s deck is more than an overview: it needs to tell a story. All great stories - whether told on film, in books, or as a spoken tale - require a connection or concern for the characters, building momentum, some conflict, and of course, a climax. The best decks I have seen fit this mold – they are stories so coherent, and so logical, that I literally become excited reading them.
I would posit that few, if any startups are approaching their decks from this perspective. But consider the context: you are an expert in your company. I am not. The vast majority of the time, someone similar to me - meaning a 20-something associate with 2-4 years’ work experience who is writing up 15 deal reviews a week – will be reviewing your company’s deck. This is true whether you are pitching VCs, accelerators, incubators, or trying to sell a larger corporation. The first line of defense will likely be someone who is not an expert in your domain. Hence the importance of telling a compelling story.
I don’t need to be a military expert to appreciate Saving Private Ryan, or a quant geek to love Good Will Hunting – that’s the power of great story-telling. As a former professional poker player, the turning point in my success came when I started approaching each unique hand as a contained story. Do the pieces of the puzzle fit together? Is this a logical progression?
Adopting this approach to presenting your company will greatly enhance your firm’s reception. Here’s why:
The majority of decks I see follow a standard approach. They present the problem, then I’m told the market size, their solution, some traction, the team, and the fundraising goals. Fair enough, all useful information. But you’ve effectively just mailed in a series of bullet points, dressed in pretty graphics. A good deck, like a good story, connects the dots with ease, building my interest. A good deck will integrate the consumer’s point of view while hinting to investors of the potential.
For example, rather than merely telling the problem, a better approach is to consider and express why people care. How many hours from the day are lost through a poor legacy product? What are the ramifications? When I see that someone is losing 15 unnecessary hours per week due to an inefficiency, I know that person is likely to pay well to get them back. You get the idea.
But the single most important piece of the story is your traction. If I’m engaged in your story and increasingly understanding how the pieces come together, but then see that no one’s signed up or you haven’t started selling, it’s as if someone unplugged the TV in the middle of the climax moment. The deck is supposed to be building momentum – once your platform or product makes sense to me, I want to see adoption. That doesn’t mean a million users; but it does mean continued growth. Show me what happened to your metrics when you improved a product, or changed it. Show me how much you know about your consumers, and how you’ve seen progress through experimentation or A/B testing. An early stage startup is, in many ways, an organic process – the best way to help me understand your full story is to make me a part of that process.
Two very helpful links:
From Ryan Spoon @ Polaris Ventures on creating an early stage deck:
http://techcrunch.com/2012/01/07/pitchdeck/
From Naval Ravikant of Angellist, who actually doesn’t think the deck is vital, but offers great advice on how to make your startup’s story compelling and engaging. His thesis of communicating something “exceptional” I’ve found to be spot on.
He’s probably right that the deck matters less…if you’re friends with him. But for purposes of networking and opening doors, it will matter, especially in Chicago.
Best of luck refining your decks!
Ezra
