How to Pitch to Investors: Mistakes to Avoid and 8 Expert Tips to Level-Up Your Pitch

Pitching to investors was already scary.

Now, in 2024, the world situation makes asking for money seem even harder. Many founders wonder if they’ll be able to convince investors to give them the funding they need.

But difficult as it may be, it’s certainly not impossible.

In fact, according to a report by CrunchBase, global venture funding in the first quarter of 2024 totaled $66 billion, just a six percent increase quarter over quarter. Incredibly, this is still a significant increase from the lowest quarter in the past six years, which was Q4 2023.

The point? Investors are still giving out money, but you need to prove to them that your business is built to survive.

So, how can you prepare for a successful investor pitch? What should a pitch deck include?

By the end of this article, you’ll be fully prepared to pull off your next investor pitch with ease and grace.

We’re going to discuss:

• Mistakes some startups make when pitching to investors
• What should a pitch deck include?
• How to pitch to investors successfully: 9 best practices

Mistakes Some Startups Make When Pitching to Investors

Whether you’re talking to an angel investor, VC firm, incubator, or bank, there is one common denominator: You’re not the first person who’s asked them for an investment.

These people live and breathe startups, and they look for specific signs that tell them if you’re worth investing in or not.

Especially for new entrepreneurs, it’s easy to fall into some common mistakes and be labeled as a risky investment.

What are some common mistakes startup founders make in their investor pitch?

Hanging your Pitch on Vanity Metrics

“We have 100 beta users.”

“We got 300 app downloads in just three months.”

“50 people signed up for the program just a few days after launch.”

These are all what we call vanity metrics. Just like social media followers, likes, or kudos from your mom.

These metrics tell investors nothing about the value of your solution for users or whether it will last.

If you don’t have better metrics to show yet, it’s probably not the right time to be asking for money. Investors are interested in the market, but they’re more interested in whether or not your business is going to thrive in the long term.

To show them how valuable your product is to users, give investors metrics that tell a story, such as:

• Conversion rates
• Monthly or daily active users
• Customer retention rates
• Monthly recurring revenue gains

These metrics show how much customers love the product, not just their initial interest.

Getting Investors Just to "Save the Business"

If you’re trying to raise money with a short runway, your desperation to simply "survive" will show in your investor pitch.

As Caya from Slidebean says...

Nobody wants to pour money into a sinking ship.

Don’t consider an investment your first resource to save the company. Instead, an investment should be there to help you grow your business once it’s on stable ground.

If your pitch is based on the fact that your startup won’t survive without this investment, you’ll be unlikely to get much help.

Making the Presentation Too Long or Complex

Like pretty much everyone you will ever give a presentation to, investors are busy.

The longer your presentation is, the less likely they will stay focused.

A good length to shoot for is about 10 minutes. Any longer, and you risk losing the interest of your investors.

But what if you feel you can’t give all the information you need to in just 10 minutes? Then, you’re trying to present too much information, and investors will walk away confused.

Instead, be concise and clear. Clarity and brevity go hand-in-hand, so we can avoid investor pitch decks that look like this...

...and present a solution that is clearly understood by everyone involved.

Allocating Too Much Money to Founders' Salaries

When investors see a $300,000/year salary for the founder of a startup they’re investing in, that’s a red flag.

Startup founders: You can’t expect to earn big bucks from the get-go.

With time, your well-produced ideas will turn a significant profit. But if you expect a cushy salary paid out by investors, you will likely be disappointed.

Using Your Pitch Deck as a Script

Too many investor pitch decks contain text that is too small to read, and too many startup founders end up reading all the displayed text instead of talking to investors.

This is a double-sided mistake that can be easily solved: Just remember that your pitch deck and your sales script are different.

Sure, you need to consider what you will say to investors when you walk in the door. But that’s what a script is for, not what a pitch deck is for.

Create a script that works alongside your pitch deck and practice it beforehand. You’ll feel calmer because you’ll know what to say, and the clear visuals in your pitch deck will add more depth to those words.

Distracting the Pitch with More Than One Product

You have dreams. Big dreams. And that’s great.

But today, you’re not selling investors on extravagant plans for the future. You’re selling them on the product you have built (or are building).

Sure, those plans for the future fit nicely on your long-term roadmap, and you can mention them in your presentation. However, the main meat of your investor pitch should focus on the core product that you are producing today.

That way, there are no distractions, and it’s clear to investors that you’re ready to ship a good product now, start earning money, and work to improve it in the future.

What Should a Pitch Deck Include?

As you create your pitch deck, how can you ensure investors are truly interested in your company? How can you get them to see the same potential in your ideas as you see?

Your investor pitch deck should include key slides explaining and convincing investors that your idea has true value. Whatever else you include in your pitch deck, make sure these slides are there:

Problem/Solution

What does your product do?

Your opening slides are here to explain the problem and then how your product solves that problem.

By positioning your product as a solution to a real need right from the get-go, you show investors there is a place in the market where you fit perfectly. Market validation will come later, but this type of introduction sets the right tone for the rest of the sales pitch.

One simple way to do this is to use another popular brand as a reference, as this streaming service did in its investor pitch:

In one simple sentence, it’s clear what this company does and how it serves its market.

Just one note of caution: If you reference another large company, don’t do it just for the name. Ensure the company you reference has a similar business model and that the comparison helps investors understand your company, not confuse them.

How it Works

Now that investors know what your company does, they need to know how it works.

Once again, simplicity wins: Condense the "how it works" slide into three easy-to-digest steps.

Using a three-step list forces you to simplify your product and pack the most meaningful description into this slide.

Market Size

What market does your company serve? How big is that market, and what kind of demand is there for a product like yours?

This slide is all about validation: Prove with real numbers that there is a genuine demand for your offering.

Traction

Now, it’s time to examine your business's numbers. As we mentioned above, don’t base this slide on vanity metrics like social following, signups, or downloads.

Focus on metrics that tell investors how people react to your product.

Monthly users, MRR, customer ROI, and similar metrics are powerful demonstrators of your product's real interest. You could even include customer testimonials showing the value your current customers get from the product.

Business Model and Plans

This is not a place for vague dreams and aspirations. This slide is where you give a concrete description of what you plan to achieve.

Investors need to see how your company makes money, how much it will make in the coming months and years, and when the company will start making a profit.

So, describe your company’s process for turning a profit. How much profit do you get per unit sold or subscription purchased? How much MRR are you seeing now? What kind of increases do you expect this year, and what are you basing your forecasts on?

While long-term plans can be mentioned in this section, don’t rest your pitch on plans that are still years away from happening. Focus on the growth you’re seeing now and how that will continue into the coming months.

Competition and How You Compare

To determine whether a company will survive, investors need to see who its main competition is right now and how it stands out from that competition.

So, who competes in the same space as you? What share of the market do they hold? And what are the main advantages of your product over theirs?

Investment Ask

Now it’s time for the hard part: How much money are you asking for?

The key here is not to include your total ask: Give investors the details on where this money is going.

Adding allocation data shows investors that their money is going to be well-spent, whether it’s on product development, increased personnel, better marketing or sales tech (like a high-powered startup CRM), or other relevant spending.

Team

This slide is more than just a glimpse at who’s involved in the company: This is a place to include further proof that your product is set up to succeed.

As a startup founder, you chose the team you have for a reason. What makes these people so special? Why are they so qualified to work at your startup? How do they individually contribute to the success of the business?

In this slide, prove to investors that your team is the A-Team of the startup world and that you are ready to crush it.

How to Pitch to Investors Successfully: 8 Best Practices

Your pitch deck is ready to go, but the nerves are still making your knees wobble a little.

Want some extra prep before you walk through those doors and start pitching? Check out these 8 best practices to help you give a truly killer startup pitch.

1. Add a Narrative to Your Investor Pitch Deck

Stories speak to your audience and help them remember what you’ve said. That’s not something we just made up: Neuroscientific research has shown that stories stimulate the brain and even change how people act.

The brain, it seems, does not make much of a distinction between reading about an experience and encountering it in real life; in each case, the same neurological regions are stimulated.

So, tell a story with your investor pitch.

A great example of this is the well-known Brightwheel investor pitch as seen on Shark Tank:

Dave used a relatable narrative to show the problem that his product would solve, giving his pitch even more meaning from the start. This pitch got Brightwheel a serious investment, and he raised over $30 million in the following two years.

In short, stories are a powerful tool for your investor pitch.

2. Use Real Numbers

Vague ideas and guestimations have no place in your investor pitch.

Investors must see genuine validation with real numbers to have enough confidence to invest in your product. If you’re using charts or graphs, include numbers and text that give a quick understanding of the data you’re presenting.

Using real numbers adds meaning to an otherwise vague and unconvincing pitch, whether you’re talking about market size, company revenue, or growth.

3. Make it Pretty

While it may not seem like a big deal, having a visually appealing, well-designed pitch deck can help you in the long run.

After all, a nice pitch deck shows investors you’re organized, you care enough about this meeting to present something that took some time and effort to create, and (hopefully) your product will look just as nice.

4. Be Transparent and Honest

If you feel that certain aspects of your business need to be hidden from investors, you probably shouldn’t be there in the first place.

Transparency is always the best policy when it comes to giving an investor pitch. Whatever you try to sweep under the rug will probably be uncovered anyway, and the fact that you hid it will ruin your reputation and chances of getting an investment.

Give an honest valuation of your company. Explain in clear terms the profits you expect to make. If your company is losing money right now, tell them. When you explain your weak spots along with solutions or clear plans to improve, you alleviate the investors' minds and show them you’re working to better your product as you move forward.

Our CEO, Steli, believes that sometimes, you should mention the weaknesses of your offering in your sales pitches. The same is true for your startup pitches.

Worried that your honest pitch just isn’t cut it for investors? Instead of trying to frame your pitch around what you think investors want to hear, play to your strengths. Focus your pitch on the real, measurable strengths of your company, and you’ll build a convincing pitch.

5. Keep All Data and Team Information Up-To-Date

Asking for an investment can take time and may take several meetings with different investors.

As time goes on, your startup's situation and the people who work there may change. When this happens, make sure you update your pitch deck. Investors don’t want to see your MRR from two years ago; give them information from today.

6. Project Realistic, But Bold Outcomes

Yes, this may seem contradictory.

As we said above, transparency will help you with your investor pitch. But don’t underestimate your startup's potential.

You are an entrepreneur. You have dreams. And you have the vision and the grit to get them.

Your bold vision and grit will convince investors you have what it takes to build a successful startup. So, get investors to see that vision.

7. Send Your Pitch Deck Before the Meeting

While you need to be prepared for the meeting, investors like to be prepared as well. If your pitch deck is easy to scan and digest, investors will appreciate the extra time you spend preparing for your meeting and getting to know your company a bit before you walk in the door.

As a note, make sure to send the deck in PDF or another easy-to-access format so that investors can see it without having to jump through hoops.

8. Expect Questions and be Ready to Answer Them Calmly

If you go into your investor meeting unprepared for questions, it will be far too easy to react defensively to the questions investors have.

For these people to offer you their money, you need to prove your idea and business are worthwhile. While you try to include the most important points in your pitch deck, they will still have questions.

How you answer these questions will affect their view of you and your brand.

Check out this example of an investor pitch as seen on Dragon’s Den:

Right after the pitch was finished, the investors hammered these co-founders with questions that weren’t always easy to answer. However, the pair responded calmly, allaying the investors' fears, and finally got the funding they sought.

Think about the kind of questions investors may ask you. Talk to other startup founders who have asked for funding and see what investors have asked them. List these common questions, and write down possible answers you could give.

When you’re prepared for these questions, you’ll be better able to answer them calmly without going defensive.

Crush Your Next Investor Pitch with a Deck that Sells

Pitching to investors is scary. But with the right attitude, good preparation, and a killer pitch deck, you’ll be ready to go into that room and pitch confidently to investors.

Want to make your pitch deck pop? Download our free templates to see what an investor pitch should look like, get guidance on what to include, and customize the template for your next investor meeting.