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    Avoiding Common Pitch Deck Mistakes

    December 22, 2020

    2 min read Avoiding Common Pitch Deck Mistakes. Mistakes to Avoid Putting the right pitch deck together takes time and practice. It’s not something individuals often get correct on the first try. In developing a pitch deck, there are several mistakes that you can avoid. One of the most common mistakes is explaining how the product or technology works in great detail, but this isn’t necessary. Instead, use the pitch deck to focus on its benefits and what the product does for customers. Save the detailed explanations for later on in the process when you are in diligence. Some other common mistakes to watch out for are as follows: Not identifying the competition or claims there is no competition. Utilizing a font so small that no one beyond the first row can read it. Using too many words; overuse of words can distract the reader. The flow of the slides does not follow a logical story form. Displaying market sizing to distract the audience from the fact that you have no traction. Not having an “investment ask” at the end of the presentation, leaving investors wondering what you want from them. The pitch deck should focus on your: Core product Team Customer Fundraise You can flesh out the more extensive details later. Finally, the biggest mistake you can make with your pitch is not asking questions and not listening. Most startups spend their time talking when they should be listening for objections and concerns. Pay attention and welcome questions from your potential investors. What Your Pitch Deck Should Do A pitch deck is a brief presentation that provides your audience with an overview of your business. Ideally, the deck should answer any questions an investor might have. The primary goal of the pitch deck is to introduce your deal to an investor. Additionally, the pitch deck should serve as a way to show what is essential to an investor who may be considering an investment in your startup. A pitch deck is not is a means to explain the full history of your company. It is also not a means to explain how your product works. Tips for Pitch Deck Success After you’ve made your pitch, be sure to schedule a follow-up meeting with the investor. Good pitch decks show: What you are doing differently within your given sector. How you can grow more with funding. An ideal pitch deck showcases that the business’s proposed outcome will happen with or without the investor. In other words, your pitch deck should show that your future is inevitable. Ideally, you want to use your pitch deck to show potential investors that the results are there. Put those results up for everyone to see and show them what you have accomplished so far. The slides of your deck serve as the presenter, not the other way around. When pitching, avoid discussing multiple scenarios. Investors will find it challenging to keep track of what you’re trying to accomplish. Most importantly, focus on the core message: Product Team Market Fundraise Outcome Remember: You are the presentation; the slides are the presenter. Read more: https://staging.startupfundingespresso.com/the-art-of-pitching Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

    How to Show Traction When You Are Pre-Revenue

    December 21, 2020

    2 min read: We know that investors are looking for traction, but how to show traction when you are pre-revenue? Contrary to popular belief, even if you are pre-revenue, you can still show traction with your startup. Traction can be represented by any activity with customers, even without revenue. You can show customer engagement at all phases, even before you have a product. You should have customers coaching you on what product to build. First, when communicating with investors, always include customers in your discussions. Never engage an investor meeting, email, or conference call without new info about your customer and always mention it. If you are pre-revenue, you can still talk about the prospective customers you are working with to build your product and what they are saying. The customer problem is the most important thing because it shows you are close to the revenue source, and you are working towards obtaining it. Be able to name the customers, both the company and your contact. Never talk about the customers as a general group with vague and fuzzy references. Talk specifically about the problem they want to solve and how much it costs them. Next, show how you’re building your product to solve the customer’s problem. Discuss pilots, beta tests, MVP usage, and how the customers are engaging. Once you have a few customers closed, you have enough information to start building the Unit Economics story. Show the cost of acquiring those customers, qualifying them, closing them, and how it’s a profitable business. Place those customers in a sales funnel to show prospects moving through the funnel. Place upcoming prospects at the top of the funnel to show more are on their way. You now have a repeatable, predictable process. The secret here is that most investors don’t look for big revenue; they look for repeatable revenue. In your investor updates, show additional customers coming into the funnel and moving through it. Highlight that the cost and timeframes are the same, emphasizing it’s a repeatable process, and you’re just “turning the crank.” If you’ve decided you’re not going to talk with customers until the product is complete, then you may want to rethink that strategy. Involve customers from the start and get their help on it, and ALWAYS be talking about those interactions with your investors. Read more: https://staging.startupfundingespresso.com/education/ Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

    Your Fundraising Growth Story Pt. 2

    December 14, 2020

    1 min read  Your Fundraising Growth Story Pt. 2: What’s Your Story? When founding your startup, it is important to have a growth story. While investors may invest in teams and technology, they’ll still need to see your operating cost model, how you are finding customers and how much they pay for your products and services. If you’re bringing in a lot of money, the investor will assume that you do have a story to tell. These investors will look at your business model to see how much you can grow as well as what challenges you’ll face and at what point. If your company is low revenue or pre-revenue, you can show in economic units the proven and repeat business you have. If you haven’t already, take out $5K and prove the unit economic model. Let’s say you can get a lead paying $1 for a social media ad. You then send follow-up emails which give you one lead out of fifty. Your lead then spends an average of two hundred and fifty dollars for your products or services. You can then take these numbers to come up with a basic financial model. It tells how much it costs to get a customer and the value of the loan. Knowing your numbers and being able to tell investors how you’re growing is a key to fundraising. Read more: https://staging.startupfundingespresso.com/eguide/ Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

    Your Fundraising Growth Story Pt. 1

    December 7, 2020

    2 min read  Your Fundraising Growth Story Pt. 1: To raise funding, you must have one. Many entrepreneurs approach me for funding for their startup. The biggest misconception most have is that they must first raise funding, and then they can launch and grow their business. In reality, the ones who raise funding already have a growth story and can communicate it effectively to the investors. Investors funding startups seek market validation and product validation. The product works, and people will pay for it. Some investors fund deals based solely on the team, the space, or the technology, but these are rare examples. Most are seeking what I call the “Growth Story.” They look for an operational revenue model in the business with increasing numbers on sales, team, product, and fundraise. If you have substantial revenues, say $1M, then the investor assumes you have a growth story going at some level and will start looking for the growth story’s limits- how far will it go without funding and how much further it could go with funding. Later stage investors will look at the growth story to see how well you can scale it. If you don’t have substantial revenue, you must validate the business model and use metrics to show how it works on the following levels: Activity: basic activity of the business, which includes leads, downloads, trials, etc. Unit economic metrics: the unit economic model, shows the cost of customer acquisition and revenue. Growth metrics: the user base and usage of the product is growing. Most startups can show activity metrics, but alone it won’t engage the investor. Typically the activity metrics show several users and customer engagement, but since it’s not related to what drives the business, it doesn’t mean much. But I’m pre-revenue! If your company is pre-revenue, you can show how the business model is “profitable” just on the unit economics level.  At the core, you can generate leads, qualify, and close them for revenue that exceeds the cost of acquiring the customer. Over time, you can improve these numbers. In the early days of a business, the revenue is not large. Most investors know that and don’t expect large revenue. What they look for is repeatable and predictable revenue. Showing unit economics at the core of what you are doing will generate interest. The growth metrics show the number of users increasing and the use of the product increasing over time. Daily active or monthly active users should be going up and to the right. If the business has seasons or cycles, one can use six-month moving averages to show the growth rate’s slope. Scott Adams once wrote, “Losers have goals. Winners have systems.” A startup pitch deck filled with forecasts alone is just a set of goals. A startup pitch deck showing how the business model is currently working is a system. It’s best to show up with a pitch deck showing how your system is working today. Read more: https://staging.startupfundingespresso.com/education/ Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

    Fundraising Metrics That Matter

    November 30, 2020

    2 min read  Investors look for the specific metrics in your business, so it’s important to know the fundraising metrics that matter. There are three areas that you should focus on: Activity Metrics show the basic activity of the business Unit Economic Metrics show the unit economic model, including the cost of customer acquisition and revenue. Growth Metrics show the growth in the user base and usage of the product. So what to include? Activity metrics can include things like the number of users, downloads, or subscribers. While they fall short of business results such as closed sales, activity metrics can show your customer engagement level. If your company is pre-revenue, you can show your business model’s potential profitability using unit economic metrics. Ultimately, you want to show the cost and process to generate leads, qualify them, and close them for revenue. In the early days of a business, the revenue is small. Luckily, most investors know that and don’t expect large revenue. Instead, they want to see an accurate forecast of repeatable and predictable revenue. Showing unit economics demonstrates that you have a core business model working, and with time and funding, can improve. Growth metrics can demonstrate several things, such as an increase in the number of users, or an increase in the frequency in which customers are using the product. Active users should be going up and to the right. If your business has seasons or cycles, you can use a six-month moving average to show your growth rate. Knowing your metrics is vital when looking for funding, so be prepared, and potential investors will take note. If you can only show activity metrics, then do so. Better yet, validate your business model with unit economic metrics. Ultimately, the fundraising metrics that matter show growth in users and usage. Whatever you do, don’t show up empty-handed. Read more: https://staging.startupfundingespresso.com/education/ Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

    How to Tell A Story

    November 24, 2020

    2 min read How to tell a story. What makes a story? At its core, a story consists of a beginning, middle, and end. If it’s a good story, that beginning, middle, and end will take you on a journey. If it’s a great story, it’s likely one you will never forget. So, what does the art of storytelling have to do with your startup? The ability to tell a story gives you the means to make your company memorable. When pitching your business plan, use the story format for a more significant impact and as a way to connect with investors. Start with the problem you faced in the industry (the beginning). Show how you couldn’t find a solution (the middle). Show how you created your solution (the middle). Highlight the challenges you overcame (the end). Show the current business status and your upcoming plans (the end). After you address the issue of not finding a solution, be sure to show how others are now coming to you for that solution. Along the way, you can talk about how you built the team and chose a go-to-market strategy. Remember, it’s about taking the investor on a journey, so make it as memorable as possible. Each element of the story should highlight one aspect of the business plan. When contemplating how to tell a story to your investors, remember to keep your audience engaged throughout the pitch. Make sure your presentation has direction and that there’s a beginning and an ending. This makes the journey worth it. Read more: https://staging.startupfundingespresso.com/education/ Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

    Building Investor Engagement

    September 10, 2020

    2 min read How to Raise Funding Step 2: Building Investor Engagement You have a good list of investors that are interested in your deal, but how do you get investor engagement? You need to introduce your deal to the investors and demonstrate why it’s a good deal, the operative word here being “DEMONSTRATE.” Most startups tell the investor why it’s going to be a good deal; superb product, great team, great market, great future, etc. The key is to SHOW them. Start by highlighting your traction with customers, the experience and ongoing work of the team, and the improvements on the product. Investors see dozens of deals every day. You can stand out by remembering one thing: Everyone promises, few deliver. Every startup has a great future. Every startup promises the moon.  So what does the investor do? Look for evidence of meeting milestones and a sense of momentum behind the deal. Your outreach to the investor is a campaign, not a one-time contact. You must demonstrate that you have traction. The team must be doing great things. The product must be progressing. If you can’t do anything until you have that $500K, then the process will get tough. You have to show you can do things with little or no funding. Use campaign mailers to tell your story. Over the course of several mailers, you need to showcase your deal and how it works. Investors are busy. They don’t have time to read 5000-word emails. They’ll read a half-page, maybe a little more, and that is it. You need to tell your story over a series of emails as we work our way into the busy lives of the investor. Break the information down into smaller pieces and schedule them out so the investor can see your progress regularly. Read more in the TEN Capital eGuide: https://staging.startupfundingespresso.com/how-to-raise-funding-eguide/   Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

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