August 31, 2022 | 6 minutes read

🚩 Red Flags in Pre-Seed Pitch Decks

(and how to avoid them)

Entrée Capital Team

After reading a number of “How to’s” on pitch decks we decided to take the topic and turn it on its head by sharing some 🚩 “red flags” that we suggest you avoid while building your deck.  

📏 Too long:

    • Your deck should be less than 15 slides. Don’t stuff those slides with text. No more than 6-8 lines (or 30 words) per slide. And as often as possible, use bullet points and not paragraphs.
    • Most likely, investors will want to see the deck before you actually pitch it to them. It should be clear enough for them to understand without you being there to explain it. If you plan to include charts, data, or visuals, be sure that there is a clear explanation as to what they are. 

🧶 Messy order or design:

    • The order of the slides in your deck needs to make sense and tell a story; someone reading your deck should know EXACTLY what you’re doing within the first three slides. Don’t be vague. Be clear about what your company’s purpose is and what exactly you want to do right from the start.
    • As general consensus from the Entrée team, your order of the sections/slides should roughly follow this: 
      1. Purpose
      2. Problem
      3. The Market (TAM)
      4. Solution (Product)
      5. Business Model
      6. Competitive Analysis
      7. Why now?
      8. Why us?
    •  The design of your deck should also be compelling and part of your broader narrative. Start thinking about what brand identity you want to convey and how you want to showcase the data/information in a straightforward and visually pleasing way. 

📚 Bad storytelling:

    • We’ve seen founders that do a great job at showcasing the very practical short-term plan for their MVP, but when asked about where they see their success in the big picture, they can’t answer. Storytelling is critical; balance your vision with details of how you’ll get there. 
    • Include a slide about traction/proof for your product (this could be connected to the “market” or “why now” sections). You might have built your product for a pain that you, your friend, or your mom had, but it’s not enough to sell this vision. Prove to your investors that your solution is needed, will be adopted and paid for, and has room for growth. (This can include proof of user growth, your profit (or loss) metrics, or feedback from your beta users. Think: Clear hard data as proof points.) 

🤥 Embellishment (aka, lies): 

    • Investors aren’t stupid. If you don’t actually do AI or ML, don’t say that you do it. It’ll come out in any deeper diligence an investor will do, and that will kill the fundraise. Don’t over-embellish your capabilities. Don’t lie about your product or its readiness. 

🌟 Too many buzzwords:

    • Don’t fill your pages with buzzwords. It’s not a resume going through an automated system. “Disruption”, “life-changing”, “market-disrupting”, etc… use these terms in heavy moderation (or not at all). Even an overuse of “AI/ML”, “cloud”, and “blockchain” in your pitch can be a red flag. Move beyond the surface buzzword level. 

🤳 No product visual: 

    • Even if you’re at the very early stages, you must have at least some product visuals, mockups, and wireframes in your deck. Include a simple-to-understand overview of what your product does, what has already been built, and your roadmap/feature pipeline. We suggest that you put your product front and center and use it to frame the rest of your pitch and the market that you’re in. 

🧑🏻‍🔧 Too deep into technical detail: 

    • It’s not good to be vague about your purpose or goals, but spending too much time on the small technical details of the problem, solution, or business plan can make the pitch drag on and lead to you and the investor getting stuck in the weeds. When you do need to explain a complex concept or problem (DeepTech etc), explain it at a higher level and as a categorical problem, and then be prepared to dive deeper if prompted.

🌍 Poorly analyzed market size:

    • The TAM of a product/solution is an important indication of investment worthiness. Avoid the cliche diagram of two/three circles (your markets) intersecting to show a big market. And don’t just throw in statistics you have not researched in depth (and by in-depth, we don’t mean an in-depth dive into Google to copy/paste from a market report).
    • Properly analyzing and presenting your market is an opportunity to show your depth of understanding of your buyer, their budget, etc. Spend the time to do a proper bottoms-up analysis of what you can sell annually to different customer segments. 

📈 Business model is too broad:

    • Make the business model slide relevant for your stage. Be sure that whatever your business model is, it’s concise, repeatable, and has a monetization plan that is easy to understand with a realistic first-year revenue projection. 

🤺 Poorly analyzed or researched competitive landscape: 

    • Investors know that you are not wholly in a league of your own and do their own analysis. Be sure that you’re not leaving out obvious competitors and be honest about who your direct and indirect competitors are. Know your top competitors’ business models, pricing, and funding history; show the key items as that helps establish market maturity.
    • When showcasing the competitive landscape, don’t make a list of general features and have all X’s next to your competition and all V’s next to you. It doesn’t prove anything. Be sure you have specific features and explanations to go along with it. A good competitive landscape slide includes a clear explanation (either via a chart, X/Y axis, or bullet points) of who your 3 closest competitors are and why you deserve/need to exist.

👫 Why us”/ “Team Slide” unclear or non-existent

    • Many investors, like Entrée, are looking at the team just as much (if not more) than the solution itself. In our 4Ts model, (Team, TAM, Timing, Tech) the Team comes first. Make sure that your deck includes a VERY clear “Why us” team slide that clearly shows short bios (plus LinkedIn links) and how the core team members are the exact right people to solve this exact problem. Show why you specifically (based on skills, personal experience, and knowledge) are the ones to do this. 

😑 No practice/not proof-read:

    • The more you practice, the better you’ll get at answering questions or making the pitch flow properly, and the more you might realize that you’re missing something (if you do it with constructive criticism in the room). Also, spelling typos are red flags. Yes, even if English isn’t your native language (or your investor’s) typos indicate a lack of care and professionalism. It’s a small detail that makes a big difference.

Think you and your pitch deck are ready? We’d love to connect.