If you are working on your pitch deck to secure investment for your startup, keep the following “investor red flags” in mind to get it right.
Lena Mårtensson
A good pitch deck can be the door opener for a lasting relationship with an investor, but a bad one might go right to the stack of discarded ones, no matter how good the business venture actually is. During his masterclass “The Perfect Pitch” at the 2024 Luxembourg Venture Days, venture capital investor Quentin Dupraz, Principal at Ilavska Vuillermoz Capital, gave an overview of aspects that immediately makes him question the credibility of a pitch or lose interest in the company. Here are some of the “red flags” he highlighted.
When sharing his best tips for how to prepare a great pitch during the masterclass, Mr Dupraz underlined the need to create simple, understandable slides that directly attract investors’ interest. “When the slides are overloaded with details you lose interest, no matter how good the product is,” he said, pointing out that the slides don’t have to say everything. “Think of them as the support material to trigger human interaction with investors. Don’t underestimate the social bounding. We are there to have a good time, not to be drowned in detail.”
Figures that do not match, contradictory statements and incoherent wording are problematic. “To me, inconsistencies are a rejection criterion. Be very cautious of using the same jargon and stick to your defined business model throughout the pitch, otherwise it reveals that you made it up.”
According to Mr Dupraz, it is always best to be open about your competitors and not try to diminish them. “Anyway, competition is irrelevant for early-stage startups. Focus instead on client understanding so that you can build a great product and differentiate yourself in your niche market.”
Startups should remember that tech investors are not necessarily specialists in their specific field of operation and might find some jargon difficult to understand. “Make the pitch as simple as possible so that everyone can understand it,” Mr Dupraz advised.
The financial aspects of a company are of course important, but everything does not have to be included in the pitch deck. “For a first introductory pitch to an investor, the financial information should stay light."
Presenting the concept for your product to prospective buyers is a great way to determine if there is any need for it in the target market. Information about this market validation should not be left out of the pitch. “This is the best proof of value of what your startup has done so far.”
“The pitch deck is your entry point to further interaction with the investors,” Mr Dupraz pointed out. The Q&A part that usually follow a face-to-face pitch kicks off the interaction between founders and investors. “This is a time when you really want to test the founders’ ability to be flexible and go very far. If they are reluctant to talk, it is not a good start for building a lasting relationship.”
