Haje Jan Kams recently wrote on the TechCrunch website that the three most important slides in your pitch deck are traction, team, and market. (As an FYI, I really, really like Haje's ideas and think it's worth reading almost anything he posts!)
In general, I agree - but I think there are two other slides that are critical: The Problem, and The Solution.
The fact is, most pitch decks I've seen provide way too much information and don't focus on these five critical areas. By adding too many slides, you are simply diluting your message and your chance of raising capital. The fact is, you don't need 15-20 slides in your pitch deck; experience tells us that keeping it lower (10-12) is best. If you can communicate your company and solution in fewer, then that's even better!
But... no matter how you structure your deck, there are five (not just three) slides that are critical: Problem, Solution, Traction, Team, and Market.
(Come to think of it, you could probably just have an infographic that covers these 5 points. Why do a pitch deck at all? Everybody hates PowerPoint anyway.)
No problem, no funding. If your company isn't solving a business issue - a real pain point - then you need to question whether or not your company is viable long term. Sorry - that's just the way it is. No problem (to solve), no path to funding. Be sure to spend a lot of time getting this right.
OK, you've identified a problem - but have you built a better mousetrap? Is your solution something that can become a 'must have', or something that provides a truly innovative way to make the problem go away? The challenge is, there are so many 'solutions' out there that seem good... but may not have the staying power to overcome future challenges.
Up, and to the right. This is, by all accounts, the single most important slide in your deck. That said, there are lots of different ways you can illustrate traction, including:
ARR / MRR
Basically, whatever metric shows the fact that you are gaining traction with actual customers is vital. My personal view is that profit, EBITDA and/or ARR (or MRR) are best.
You don’t have to be a well-known founder or early-stage maven to have a proven team. And just being a founder with experience and multiple exits doesn’t always cut it. Of course, that helps – it’s easy to see that founders with past successful exits generate interest, but the team has to be credible. Some hallmarks of a great team include the following list but don’t worry if it doesn’t describe you – you just have to position yourself and your team the right way!
A founder with bootstrapped exits is always attractive to VCs and PE’s.
Expertise always matters
Intrapreneurs can become successful entrepreneurs
Expert customers make good founders as well
It goes without saying that if you have no quantifiable market for your solution, then you are dead in the water. It implies that you haven’t found a problem that needs to be solved, or have a solution in search of a problem. What you need to identify is:
A rapidly growing, promising market: The bigger the better (a rising tide lifts all boats).
A fashionable market: Like it or not, investors have a strong fear of missing out (FOMO), so if your company is in a fashionable space, then you stand a better chance of success than if you are in an unfashionable sector.
A huge, mature market – especially if your solution is disruptive or offers a unique solution.
What if you don’t have these?
It’s important to have at least one of these categories under your belt – or two, or three. Chances are, though, that you’ll have just one or two at best. However, if you don’t have any of these things – traction, team, or market – then you likely have a tough capital-raising road ahead. Just having a great product is not enough – so you’ll need to ensure you craft a narrative that gets you into at least one of these categories.