VC Pitch

Prep

1
 Common Mistakes
• Over-explaining the obvious
– And not explain what really needs to be
explained
• Rushing through Slide Zero ™
• Skipping proper transitions
• Not having a team slide with photos &
relevance

2
 Structure of Exec Summ
1. What problem exists (unmet need) & who has it
2. Current alternatives & shortcomings
3. Your solution
4. Your unfair advantage (magic sauce)
5. Positioning vis-à-vis other competitors
6. Market segment targeted & market size
7. Business model
8. G2M strategy
9. Team
10. Timeline of progress & milestones
11. Financial projections
12. The ask

3
 Pitching to Investors
• Tell a story (not literally!)
1. Saw a problem ! unique insights led to a
thesis ! market research validated thesis
! assembled a team ! know our
customers & their problem & our
competition
2. We know our G2M plans, we have our
assumptions & financial projections
3. We need XX to get to YY

4
 Investor Pitch

Company Name
Name Title & Contact info
Tag Line

Audience can read the info but this is where you

explain what you guys do: This is what I call Slide Zero

5
 1: Team
• Who are you?
– Make yourself relevant
– Include advisors, consultants if they make you
look larger & impressive
• OK to show up with a less than perfect team
– All teams have holes
– Important issue is that you know that there are holes
that you are willing to fill

6
 2: Unmet Need
• What pain are you alleviating
– Get everyone nodding their head in agreement
• Describe a problem people connect with
– Tell us how you validated your assumptions
• Customer examples, use actual names
from market research
• Use-case is good way to explain problem

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3: Target Market & Segmentation
• What is your target market
• Which sliver will you own
first & why
• Market size
• Market dynamics
– Regulation, new technology,
new players

8
4: Market Dynamics & Competition
• Complete view of competitive landscape
– What alternatives people have today
• Never dismiss your competition
– Investors, customers, employees all want to know
why you are better, not why competition is bad
• Never say that you have no competition

9
 5: Solution
• How you alleviate this pain
• Make sure that audience clearly understand
– What you sell
– What is the value proposition
– Not a place for in-depth technical description –
just a gist of “how”
• Avoid text but use diagrams, schematics,
mockup, demo here

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 6: Unfair Advantage
• Why now? why us?
• Technology, secret sauce or magic
behind product
• Special alliances, relationship that
makes it possible to for you to do this,
now

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 Positioning
• How are you different from incumbants
• Using familiar players to help position
yourself

12
 7: Business Model
• How you make money
– who pays you
– what channels
– what gross margins
• What do you sell?
– Subscription
– Widgets
– Affiliate fees?

13
8: Go-to-Market & Sales Strategy
• How will you reach your first 10
customers
• Marketing leverage points
• What alliances needed or in
place
• Convince audience that you
have an effective go-to-market
strategy

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9: Financial Projection & Key Metrics
• What are key metrics & assumptions
– customers, installations, licenses etc.
• 5-year financial projection take into account
extended sales cycle
– Show the spreadsheet please
• Your “ask”

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 10: Status & Timeline
• Current status
– Accomplishments to date (last ~6 months)
– Timeline (major milestones over next ~18
months)
– how the money will be used
• Can be used to show key metrics
– Employee growth
– Customer or geographies growth
– Profit point etc.

16
 Z-Timeline

Seed $100K Series A $4M Series B $7M

Q4-’15 Q1-’16 Q2-’16 Q3-’16 Q4-’16 1H-’17 2H-’17 1H’18 2H’18

Start Milestone
e.g. 1st
company #4
Prototype
Milestone #2 e.g. 1st e.g. 10
alliance referenceable
signed Milestone #3 accounts
Milestone #5 Or
Reach profitability
etc.

betas
Alpha customer
Product acquisition Prod Launch
development

Employee count 4 6 11 18 22 29 39 54
Naeem Zafar (c) 2016 all rights reserved 17
 Pitching
• Slide zero ™
• With conviction
• Play as a “team”
• Anticipate questions, pre-empt them
• Simple slides with data (but you are not
Jobs!)
• Do not read slides

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The Process of Starting Up
1. Anatomy of a startup
2. Team dynamics
3. Opportunity identification
4. Create compelling value proposition
5. Market research to validate need, price, position
6. Understand funding scenarios
7. Business model & market sizing
8. Go-to-market strategy
9. Partnerships & alliances
10. Financial plans & projections
11. IP &legal issues
12. Fund raising process (VCs, angels & Term sheets)
13. Pulling it all together in investor’s material
14. Practice & pitch to investors

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 Cheat Sheet
• Make sure that Year 5 revenue is between $50m
to $100m (unless you are after Angels only)
– State assumptions
• Net income typically does not exceed 30%
– Don’t under estimate Y5 expenses
• Ask for enough money to get to the next stage
of de-risk (tell us what it is)

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