Statistics show that 9 out of 10 startups fail at the funding stage because their business plan fails to impress investors despite being well-thought-out and profitable. Even if a startup or a business is bootstrapped, has a successful business idea, or has a promising track record, it needs capital to drive its vision further.
While the foreign investment route has opened and expanded to cover several sectors, the founders need to try to convince the foreign investors that investment in their venture would bring long-term returns to the investor. But what can businesses do to attract funds from the right investor?
Curtains raise. Enter the pitch deck.
Call it a presentation or a proposal document, a pitch deck is used by businesses to present their business plan to prospective venture capitalists. A well-designed and comprehensive pitch deck can help a business get the resources to scale by convincing investors that your business has massive growth potential. A pitch deck may contain the following information about a business/startup:
- Business’s product or service
- Size of the market
- Target Market
- Demographics
- Team
- Competition
- Marketing strategy
- Business model
- Funding amount
- Timelines
- Exits for investors
But how can we create a successful pitch deck to attract foreign investors?
While the fundamentals underlying a successful pitch deck remain the same, we need to be careful about a few essentials in our pitch deck meant for the prospective foreign client.
Interesting Facts: Before we seek the answer about what we should keep in mind while creating the pitch deck for foreign investors, let’s tell you about how Sequoia Capital, a well-known venture capital firm, raised capital of almost $1 billion for later-stage US investments.
Mike Vernal from Sequoia Capital says, “If you can’t tell the story of the company in five minutes, then you’re either overthinking it, or you haven’t simplified it down enough.” Sequoia Capital created a clean and clear pitch deck for its prospective investors. The deck focused on their innovative ideas and clarity of thought.
Similarly, Airbnb’s pitch deck presented its core strengths and opportunities straightforwardly. They raised $20,000 in three months and $600,000 in 8 months.
Essentials to Keep in Mind While Creating a Pitch Deck for Foreign Investors
Here are five essentials to keep in mind while designing and creating a compelling pitch deck for foreign investors:
#1 Tell a Relevant Story
When meeting potential foreign investors, founders must put together their pitch in a global context while keeping the local essence intact. The best way is to tell a relevant story succinctly and effectively.
Start by introducing the team and your investment strategy and help the investor understand your company's background, what it does, its origin, etc. Distill your entire set of company objectives into a single sentence without any business jargon and having a clear focus. For instance, ‘we develop education-focused applications.’
While your narrative should be compelling enough to rope in the investor in your story or idea, you mustn’t forget to make the investors see themselves as an essential part of the narrative. Share the personal history of the co-founders and how they came together. Create curiosity, build anticipation.
Trust and credibility work wonderfully in establishing relationships. Differentiate yourself from your competitors. What are your USPs? Does your work count as exceptional? How do you define success, and how will you bring about this success? And more such questions which should be dealt with in a straightforward way.
#2 Talk Numbers, Talk of the Turning Points
Move forward organically to discuss the numbers, facts and figures about what your firm does, How it does, and how well it does. Move the discussion into details and discuss why you are confident that your firm will perform well. Make sure to add the vital startup/business metrics that investors may be interested in. You must provide the right amount of information without overwhelming the investor.
When a business is seeking funds from a foreign investor, firms should communicate the info in the language, dialect, and context the investor understands. For instance, founders should denote the figures in the numbers and metrics the investor is familiar with.
Making your pitch deck more visual than theoretical can be another way to engage the investors’ interest. The use of infographics, colors, icons, logos, and animations can amp up your chances of grabbing the deal.
#3 Know Your Investor
The investor's cultural, economic, social and political background should be considered while designing your pitch deck. Do your background research about the investors, the kind of projects they have funded, their expertise, the business environment, FDI regulations and markets where they are active, and other relevant information to familiarize yourself with the potential investor.
Doing your homework beforehand will not only save you from a lot of embarrassment but also arm you with the right insights on what clicks with them and how to deal with the questions asked during the presentation.
If you are a startup from an emerging market or feel the investor needs to be acclimatized to the markets where you operate, consider educating the investor about the specific challenges and opportunities. While doing so, use credible third-party sources to put forth your views. If needed, consider preparing different pitch decks to cater to the requirements of each investor.
#4 Present Realistic, Relatable Goals
While using simple, focused, and concise language while presenting your pitch deck can help you win the trust of the foreign investor, pitching realistic goals and timelines is also a must. Trust building starts with transparency. Therefore, show actual revenue and sales figures and then discuss the plan for how you want to sustain or grow the sales or revenue with the funding. Businesses work on deadlines. The founders should concentrate on realistically deciding on the timelines and communicating the same to the investors.
Besides the above, founders can follow several key pointers to present a successful pitch deck. Some of these include - Keeping your pitch deck short and crisp, dressing smart, being punctual, and making your presence felt before the investors. If you cannot answer any questions, be honest and say you will get back with the required info. The founders are on the same page before you present the deck and practice the pitch a few times to avoid any hiccups.
Did you find the above tips useful? If yes, all the best for your success. Even if you don’t attain success, be persistent and persevere, and not get discouraged by rejection.
Do you have some other tips that could make a pitch deck viable? Tell us in the comments below and connect with us if you seek to sort your personal or business finances. At Salt, we deal with global business banking and help manage foreign transactions in multiple currencies from multiple accounts smoothly and seamlessly.
