Unable To Communicate The Idea Clearly
One of the most valuable attributes of an entrepreneur, according to Kevin O’Leary (Mr. Wonderful) from Shark Tank, is the ability to connect, or the ability to confidently articulate one’s idea. He believes that entrepreneurs should be able to express their concept in no more than 90 seconds. That is exactly what the first slide of your deck can accomplish. Startups continue to make the error of including excessive information without being able to communicate what they really do. Simply state your point in one or two lines. The more straightforward it is, the better.
Downplaying The Competition
Unfortunately (and sometimes on purpose), some founders try to under-represent the market. They will either refuse to name any of their rivals or attempt to minimise their importance. What they don’t realise is that withholding critical information from potential investors would result in nothing positive. This causes the founders to be seen as naive or misleading, which is obviously bad for business. So do your homework, learn everything you can about your competitors, and share all of the pertinent information with whomever you’re pitching your startup.
Having A Niche Product Is Not A Competitive Market
It is impossible to consider being a niche product a competitive advantage. Since you created a niche product, it’s very tempting to have a slide that lists the big guys on the bottom left and your product on the top right (of the quadrant), but that’s not how the real world functions.
Getting a startup that only sells socks, socks that can be found on Souq for the same (or similar) price, is akin to suggesting that your competitive advantage is being niche. That isn’t going to work. If, on the other hand, your startup talks to consumers and tries to figure out what kinds of issues they have when it comes to buying socks, and then builds something about that, such as a subscription service that sends people three new pairs of socks every month, you may be on to something. Then you have a strategic advantage, a business model, and a consumer understanding. That gives you an advantage over your competitors.
More About The Market, Less About The Product
Founders have a tendency to devote a large portion of their pitch deck to explaining the opportunity and market size, particularly in their early days. It’s never a good idea to use four out of ten slides in your pitch deck to illustrate the demand and its scale. It doesn’t give you much room to clarify your product, business model, competitive advantage, marketing plan, and other crucial information. Of course, you may have a slide to illustrate the market and its scale, but it shouldn’t take up more than one slide in your deck.
Following The Hype
Every few years, we hear about the next big thing in technology. Machine learning and artificial intelligence were the buzzwords in 2015 and 2016. Followed by blockchain in 2017. Now, we are noticing a growing trend for Brain-Computer Interfaces.
All of these underlying innovations have the ability to completely change the startup environment, but using a five-year strategy in your presentation that includes the phrase “transfer [X] to blockchain” is almost never a good idea. It defeats the intent of starting a business because the buzzword you’re trying to use (for the sake of it) will be replaced by something else in five years. Investors can quickly tell if you’re really developing something around a specific technology or if you’re just trying to cash in on a current trend.
