FILE – How Elon Musk Would Get VC. (AP Picture/Refugio Ruiz, File)
Enterprise capital (VC) funding is extremely wanted by entrepreneurs, however solely about 100/ 100,000 ventures truly reach securing it, about 80/100 fail with it, and solely about 20/100,000 ventures truly succeed after they safe it. Regardless of the shortage of VC and the excessive failure fee, many entrepreneurs search VC with VC pitches, or search assist from the business-school-and-incubator community to create “profitable” pitch decks.
Whereas most pitch decks embody customary parts like product/service description, market evaluation, administration monitor file, and monetary particulars, the fact is that pitch decks are a really poor predictor of enterprise potential – and complicated entrepreneurs and VCs know that. Nobody can forecast your potential from a pitch deck. For example, about 10 of the world’s main VCs rejected Steve Jobs, and about 12 rejected Google.
That’s why VCs anticipate Aha, i.e., actual proof (proof) of potential, not simply phrases on a web page. There are 4 kinds of Aha primarily based on the actual outcomes of billion-dollar entrepreneurs. On this article, we are going to discover 4 kinds of pitch decks primarily based on these 4 kinds of Aha that improves your probabilities of getting VC if you happen to nonetheless need it once you get to the actual sort of Aha – 94% of billion-dollar entrepreneurs took off with out VC.
The Earlier-Unicorn Pitch Deck: If you’re an entrepreneur who has already achieved unicorn standing with a earlier enterprise, you will see it comparatively straightforward to draw VC on your new enterprise. This kind of pitch deck showcases your monitor file as a profitable entrepreneur. For example, Elon Musk’s pitch deck may merely state, “Hello, I am Elon Musk, and I am contemplating beginning a brand new enterprise. I will present extra particulars later. Within the meantime, ship your checks to the next tackle.”
The Unicorn-Expertise Pitch Deck: Entrepreneurs who’ve developed a billion-dollar know-how that addresses a big market want have a powerful likelihood of securing VC. This kind of pitch deck emphasizes the confirmed efficacy of the know-how and its potential to disrupt the market. For instance, a technologist like Herb Boyer may introduce his pitch deck by saying, “Hello, I am Herb Boyer, and my colleagues and I’ve efficiently pioneered the sphere of genetic engineering.”
The Unicorn-Technique Pitch Deck: Entrepreneurs who’ve already launched their ventures and demonstrated their unicorn-level technique have a bonus when looking for enterprise capital. This kind of pitch deck highlights the enterprise’s profitable execution and market traction. An instance could possibly be Pierre Omidyar, the founding father of eBay, saying, “Hello, I am Pierre Omidyar. I began a web based public sale firm and had tons of of hundreds of auctions final month and have the potential to develop into thousands and thousands.”
The Unicorn-Entrepreneur Pitch Deck: Pitch decks from unicorn-entrepreneurs who’ve efficiently launched a unicorn enterprise and are beginning to dominate their rising trade can generate vital curiosity from VCs who need to spend money on a possible Unicorn-Entrepreneur as a result of management abilities. These entrepreneurs have already demonstrated their skill to create a profitable enterprise, making it extra possible that VCs will need to make investments. For example, Mark Zuckerberg’s pitch deck may embody a assured assertion like, “Hello, I am Mark Zuckerberg. I just lately launched Fb and have already captured a considerable consumer base, beginning with Harvard and Stanford college students. Now I plan to broaden to the remainder of America and the world.”
The Finest Pitch Deck
The last word pitch deck is one which you do not want as a result of your enterprise is already rising quickly with out VC funding. Jan Koum’s expertise with WhatsApp exemplifies this strategy. Having constructed the corporate with angel capital and reaching profitability, Koum solely accepted VC funding after eight months of persistence from a VC agency. A pitch deck from him may merely state, “Hello, I am Jan Koum. I constructed WhatsApp with $250,000 in angel capital and we’re already worthwhile. So, truly, I do not want your funding. Please, buzz off.”
MY TAKE: Whereas pitch decks are all the fashion, it is important to supply actual proof of potential. Empty guarantees and inflated claims can solely go up to now. By studying from unicorn-entrepreneurs who’ve achieved outstanding development with out VC funding, you’ll be able to acquire precious insights into constructing a powerful enterprise basis. Keep in mind, VCs are in search of tangible proof of success. Intention to supply actual proof that demonstrates your enterprise’s potential and your abilities, and you will enhance your probabilities of securing enterprise capital funding