Lotti Siniscalco is a partner at Emergence Capital, where she invests in early-stage enterprise software companies. During TechCrunch’s Early Stage event, she headlined a session dedicated to giving feedback on pitch decks. What follows is a small slice of Lotti’s input from the session.
Constructing pitch decks is part art and part science. And they’re always a work in progress. Each week on TechCrunch Live, a founder and investor present an early pitch deck that won significant capital investment. The events are free to join, and after looking at the pitch deck, startup founders can practice their pitch with the investor and founder.
TechCrunch is also kicking off a series of posts digging into real pitch decks that raised rounds that we’ve covered. The first entry diving into the Minut deck is here. Enjoy!
On pitching the right investor:
“The first thing is: Know your audience. Do a little bit of research, and try to tweak the email to make it personal,” Lotti said, adding that cold emails are OK, but they’re better if they’re personalized. She gave this example, saying, “Hey, Lotti. I’m sending you this pitch deck. I’m the founder of company XYZ, and I’m sending it to you because I saw that you were on the board of this other company, which is somewhat similar, and I think there are some potential learnings in what you could bring to the table.”
Conversely, Lotti explained that if she receives a deck from a company outside her area of focus, like consumer companies, she’s not even going to open the email.
Create lasting memories of your deck:
Pitch decks are a way to tell a startup’s story, and there are ways to make investors and customers better remember your pitch.
According to Lotti, one of the best ways is to make an emotional appeal. “People remember feelings,” she said. “If you want someone to remember what you’re saying, find a way to associate a powerful feeling to it. Fear is a great one. Excitement is another, but the stronger the feeling, the stronger the memory.”
Have more than one pitch deck:
Pitch decks need to be geared to the target audience, which often results in a deck for sales and a deck for investors. Lotti advises having one for employee candidates, too. And if you have a more extended deck over 25 slides, offer a short teaser deck that makes an emotional appeal and gives the highlights of the business.
“If you’re trying to close someone, an SVP of whatever, you need to frame the business differently than if you were trying to sell a customer or sell an investor. Again, it goes back to my initial point: know your audience and what makes them tick. Take away the things that do not matter to them, and just focus on the things that matter to them.”
Make the information easy to digest:
Investors and sales targets are busy and need help to intake the information quickly. One way, she advises, is to add logos to your slides. The visual factor is a shortcut through early due diligence and allows for quick recognition.
“I’m an investor, and I probably shouldn’t say this, but VCs are lazy,” Lotti laughed. “[For example] If Gary has 25 years of experience, was he the CEO of my local grocery store or another medical device company, and seeing that logo will make me perceive the information that comes from the pitch differently.”
Use footnotes to justify or attribute wild data:
Use realistic numbers and expect investors to know when numbers are out of bounds. She warns that this is a standard skill for investors, saying that every investor is trained to know when things are too big or overly inflated. If presenting a wild number, justify it by using a footnote. If not, she says, you’ll lose credibility.
“A way to make investors feel more comfortable,” Lotti said, “is to add a nice footnote that explains the calculation and, when possible, present a bottom-up addressable market as opposed to a top-down TAM by presenting, say, a McKinsey study.” She prefers this approach to show more diligence and that the startup knows where to find its customers.
Avoid ambiguous terms:
Often, pitch decks contain a slide that presents companies, firms or groups currently using the startup’s product. Call customers “customers,” and investors “investors” when showing trajectory as investors quickly identify terms that could mean multiple things.
“Supporter could mean design partners. Supporters could mean investors, and supporters could mean advisers. I typically take partner slides with a little bit of grain of salt. If the slide says investors or paying customer, it helps me better understand.”
Keep the story simple:
Pitch decks often need to present essential information and hook the investor in under two minutes. Consider a teaser deck with crucial information if your story needs more time. Or, perhaps, the story needs to be simplified.
“If your business requires a lot of preparation to understand the nuances before you meet the VC, you probably need to reframe your story a little bit and simplify. I know this is hard because every business is nuanced and good investors know that, but you have two minutes to make an impression, so take out the things that are not must haves.”
Audio pitches are risky:
Some pitch decks are narrated or presented in a video fashion. This comes with risks, Lotti advises, adding it’s less practical for the investor.
“Depending on how it’s done, if the presentation style drags and doesn’t go at the pace of the investor, they’re going to close the presentation. If you’re a great speaker, go for it. It’s a little risky but could differentiate your company and could be a way to make an impression. If you’re anything less than a great speaker, I would advise against it.”
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