Your business plan serves a couple of primary purposes: it functions as the outline of a product or serviceâs roadmap as well as acts as a valuable resource when creating a pitch deck for investors. Lucky entrepreneurs aside, most arenât sitting on a pile of cash thatâs just itching to be invested. Completing most projects requires a connection with those who can provide financial support to see a product come to fruition.
Though you need a business plan, itâs no longer a useful tool in the pitch process when building software. Investors, like everyone else, are looking for a refined kind of storytelling that quickly and effectively hits all the main points of how your product will come to be, grow, and make money.Â
First, weâre going to describe the basis for a good pitch deck then weâll walk through the finer points of transforming your business plan into a viable pitch deck for investors.
The outline of a pitch deck
A quick search on your favorite search engine will reveal a slew of different sources that will show you what to include in a good pitch deck. To create an impactful pitch deck, youâll need to cover the following topics over roughly 10 to 15 slides.
ProblemÂ
This is the issue that youâre trying to solve with your digital product. Your focus needs to be on a single problem or a subset of interrelated problems that will be solved by your product for a specific set of early adopters (i.e. potential users with a burning need for your product).
SolutionÂ
Your solution is the end outcome of what your software accomplishes. Your solution could be the selling of a product or service, an interface for operating a machine, or even a game, among many others. Investors want to see your product in relation to the problem it solves.
Market
This is your potential audience. The âwhoâ of this equation shows investors the kind of people youâre targeting and further answers the question of âwhyâ they will use your product. Quantify the size of your early adopter market, along with the size of the market for the next few sets of users who will start to use the product as it evolves and matures.
Product
This ties back to your solution â if youâre fortunate enough to already have a prototype or at least a wireframe, this is where youâll want to showcase your product. In any case, your pitch deck should have some kind of visual to display across one to three slides that clearly shows what the product does.
Product Roadmap
The product roadmap shows how your product will grow in time beginning with the MVP (minimum viable product). A timeline of the productâs trajectory needs to show how your solution will evolve throughout its lifecycle based on vision, strategy, and any new problems expected to surface along the way.
Traction
Before diving into the meat of the financials, itâs important to show whatever metrics you can from your existing following. If youâre still in the conceptual phase (which is ok) then itâs a good idea to instead use a similar product as an example and parallel it to your product, highlighting where you will differ or excel. However, donât fake it if you have nothing to show and instead omit this section.
Team
This is where you introduce the people pulling the strings and showcase the strengths and vision of leadership. Be to the point, just like when describing your problem and solution.
Competition
Who is already in the market offering a similar solution? Competitors using a design similar to what youâre planning will inevitably affect growth, yet they also provide excellent case studies for your productâs potential success. Here, youâll want to highlight your differences to demonstrate how youâll stand out.
Here, youâll want to go as broad as possible. No investor wants to hear an entrepreneur say they âdonât have any competitionâ because that just means you havenât thought hard enough about how your users are solving their problem today. Maybe theyâre using âa shoe-string and bubble gumâ to hack together a solution today, and if thatâs the case, clearly state just that. Also, donât forget adjacent competitors â just because theyâre not solving the exact problem you are, doesnât mean they couldnât do so quickly with a few tweaks.Â
Sales, Marketing, and Partnership Plans
Tying back to the roadmap, how will you market and sell your product at each phase of its lifecycle, beginning with the MVP? This is where you will detail your plans to earn income through sales-related processes as well as partnership plans that will contribute to your revenue.
Financials
In this section, youâll detail the various KPIs that show investors exactly how the product will earn, what it costs to promote your product, and how youâll spend or invest the revenue. Refer to this piece we created which details the most important elements of a good financial model.
Amount Being Raised and Planned Uses of Capital
By this point, you should have everything you need to both express and justify the funding needed to build your product. Remember to be transparent about how funds will be allocated, from how much youâll be investing in the build itself to the marketing that gets it off the ground. Also, make sure to include any funding that youâve received thus far.
Finally, for best results, make sure to find yourself a PowerPoint, Keynote or Google Slides ninja who can sufficiently adapt this information into an aesthetically appealing slide show. Next, weâll discuss some finer points of putting together the best possible deck.
Turning your business plan into a pitch deck for investors
One of the most important elements to instill into every bit of your pitch deck for investors is storytelling. Captivating investors through a story is much like engaging users through an appâs design â a pitch deck should unfold like a well-crafted book or movie. Further, try to position a problem as it relates to you â itâs ideal when a project solves a problem you personally experience, much like how Slack started off as a solution to an internal challenge. As such, make sure to embellish such points.
Through storytelling, youâll need to reflect a human interpretation of your market analysis and audienceâs needs. In addition to the hard figures youâll convey, relate what youâve learned as it connects to a real human problem, not just why your product will sell. In doing so, your messaging will make a stronger impact by establishing a genuine, meaningful purpose. Investors want to see that you too are invested in your product and committed to following through with everything you throw their way.
When talking about the product itself, stick to highlighting its key selling points by discussing the most valuable features as it relates to the value of the solution you provide. Keep it simple as including too many details dilutes the overall story. Brevity is crucial as youâre going for more of a movie trailer kind of delivery, not a Charles Dickens novel.
With that said, your financial portion is one area where the storytelling aspect will inevitably bog down as you dive into what should be the most technical portion of your presentation. There is a lot of ground to cover and every bit of it is important. For viewing purposes, itâs best to spread this information across a few slides and be as visual as possible as this allows viewers to quickly and easily digest the information you provide.Â
Building on the financials, you need to spend time constructing your approach to sales and marketing not only for investors but also for your benefit. This is also where youâll want to tie in your partnerships that will help you on your journey as well. Detail how youâre going to develop your sales model based on your marketing efforts â investors will want to see how youâll develop your storytelling unique to this particular process. For example, if youâre selling a healthcare booking app, show how youâre going to adapt your solution messaging to the customer which is different from how you position the problem in your pitch deck to investors. Concisely show how you plan to position your product in a light that will sell to the needs of your audience in both direct and organic efforts.Â
All of the above should come together in a way that justifies your budget and capital needs. Understand youâre likely going to come up with a number that could very well make you feel uncomfortable and shake your confidence, especially if this is your first time asking for a large sum of money. Itâs not uncommon for newer entrepreneurs to see a figure that they themselves canât afford which in turn makes them feel sheepish when pitching investors. If youâve done the math and crunched the numbers enough to be confident in the cost to bring your project to life, do whatever it takes to tap into this confidence when selling your idea.
Blue Label Labs can help you refine your messaging to resonate with investors
We have built great digital products for those hailing from all kinds of different financial situations from those new to the game to the financially-secure, serial entrepreneur. Whether running through a full Design Sprint or simply helping make sense of some data youâve unearthed, we can help you supplement your business plan and pitch deck to maximize your impact when engaging investors. Let us know where youâre at in the process by getting in touch with us today and weâll do everything in our power to turn your vision into reality.