Again, in THIS previous post, I outlined the high-level flow for an investor pitch deck that, in my opinion, covered the basic, necessary information required for a solid, introductory investor presentation. Here, we’ll get into the details of slides 5 & 6 with additional commentary and advice to go along with each.
Slide 5: Business Model (aka How we make money)
The business model / how we make money slide is a critical component to the pitch deck. Again, it can take many different forms but the punchline is the same: our company does “this set of stuff” in order to make money. It may be a SaaS-based web application, it may be an appliance sold directly into IT departments, it may be a freemium model…what ever it is, you must explain it clearly.
As you can see from the example slide here, the business model slide can actually be a product/solution/service description as well…as long as you’re sure to describe HOW you sell the product and the details of your go-to-market strategy and/or plan.
A core aspect of the business model slide is an articulation of how the business scales within this business “model” and go-to-market strategy. For selling directly into IT departments, it’s scaling up a direct sales force; for a product that can leverage existing channels, it’s finding and signing up channel partners; for SaaS businesses it’s how customers “find” your company on the Internet and your cost of customer acquistion versus your lifetime value of the customer to the business. Does any part of your business act as a “loss leader” for another, more valuable part? if yes, then say so. Do you have two models running simultaneously? Make sure you clearly describe and delineate between them…and hopefully describe how they benefit and support each. You get the idea.
Slide 6: Company Progress and Milestones
The Milestone / Progress slide is your opportunity to show how far you’ve come since the original concept for your business.
In the example here, there are two simple examples of how you can present this information. This sort of slide gives investors a short-cut to understanding how well you’ve executed so far in your company’s life. Important, value-creating milestones over a reasonably SHORT amount of time suggests that your company is focused, you’re prioritizing what is important to grow your company and executing against that list.
Value-creating milestones can really be anything but should clear a certain “news-worthy” bar to make a list like this. I’d suggest that the following items would clear that bar: founding the company, funding events, launching a product, winning a customer or significant trial, signing business-affecting partners, and so on.
Importantly, this slide is also an opportunity for you to forecast what your company will do next. Nothing suggests great execution to an investor such as calling your shot and coming back later and showing that “you did what you said you were going to do.” Conversely, be very careful NOT to suggest a big milestone such a significant customer win unless you’re VERY confident. The first question out of an investor’s mouth during any follow-on meeting will inevitably be: “so, did you land that big account?” You never want to say “No” to that question because there is no good explanation for why not given the fact YOU are the one that told them to expect it.