Pitching Masterclass 2025 - Get Smart, Get Funded

The slides from my popular Pitching Masterclass for Startups - https://pitchingmasterclass.com, the definitive guide for how to pitch your startup and get funded since 2013.

It covers how the funding game work, how do I find investors, how do I contact investors, what are the different pitch types I have to master, what goes into a pitch deck, how do I successfully pitch investors, etc.

Transcript

1. Pitching Masterclass With Vidar Andersen pitchingmasterclass.com
2. vidarandersen.com VIDAR ANDERSEN • Startup Founder • Educator • Corporate Innovation Advisor MEET YOUR INSTRUCTOR
3. PEOPLE PITCHED IN PERSON
5. PLACES FEATURED & RECOGNIZED
7. CO-FOUNDER THE RHINELAND PITCH GERMANY’S LARGEST PITCHING EVENT - EST. 2013
8. I HAVE TRAINED OVER 3.000 STARTUPS HOW TO PITCH
9. HAPPY MASTERCLASS CUSTOMERS
11. CONTINUE ON pitchingmasterclass.com
12. FIRST THING FIRST
13. ARE YOU A NEW COMPANY OR A STARTUP?
14. BOTH AWESOME BUT DIFFERENT
15. FINANCING EXECUTION SCALABILITY DIFFERENT
16. REALITY CHECK: IF YOU CAN GET A BANK LOAN YOU ARE NOT A STARTUP
17. REALITY CHECK: IF YOU ARE A NEW COMPANY WRITE A BUSINESS PLAN
18. A BUSINESS PLAN IS THE VEHICLE TO GET A BUSINES LOAN
19. IF YOU ARE A STARTUP DON’T WRITE A BUSINESS PLAN
20. IF YOU ARE A STARTUP THIS IS FOR YOU
21. FOR PRE-SEED SEED TO SERIES-A STAGE STARTUPS
22. CONTINUE ON pitchingmasterclass.com
23. THE BASICS
24. An investment is the next step a ft er fi rst having done some interesting sh!t on your own. Not the fi rst step…
25. …unless your name happens to be Zuckerberg, Jobs, or Musk - aka you’ve done this before.
26. SUCCESS PAST ≠ SUCCESS FUTURE Although statistics show success in the past does not guarantee success in the future, investors are highly biased towards people who founded startups before. Perhaps mostly because many investors are lazy and do not want to have to explain the basics to fi rst-timers over and over. REALITY CHECK:
27. Investors do not exist to give permission to start anything or to make gold out of crap ideas nor sh!tty teams.
28. source: steveblank.com SHOULD I RAISE MONEY NOW?
29. REALITY TODAY
30. WARNING
31. REALITY CHECK: STARTUP PITCH COMPETITIONS ARE SUCCESS THEATRE BULLSH!T
32. STARTUP VANITY THEATRE
33. TRUE NORTH
34. REVENUE GROWTH EXIT
35. BUT… WHERE ELSE ARE YOU GOING TO GET THE TRAINING
36. PRO TIP: NEVER MISTAKE COMPETITIONS FOR PITCHING INVESTORS
37. CONTINUE ON pitchingmasterclass.com
38. COMPETITION TODAY
39. PAST
40. IVY LEAGUE You were where and what you graduated SPECIAL CONNECTIONS See above and below FROM RELATIVE WEALTH No money to your name already, no startup - much less investor capital available MOSTLY HARDWARE Di ff erent costs to set up startup - a lot of money needed
41. TODAY
42. ANY IDIOT Hardly anybody cares if you’ve graduated NO SPECIAL CONNECTIONS Almost everybody’s got the Internet to connect and build a network FROM NEAR ZERO WEALTH No personal money, much less of a barrier - never been more risk capital available MOSTLY SOFTWARE Di ff erent costs to set up startup - close to zero costs
43. CAPITAL TODAY
44. COMPETITION CAPITAL
45. WARNING
46. INVESTORS ARE NOT YOUR FRIENDS
47. THEY WILL THROW YOU UNDER A BUS IF & WHEN IT SERVES THEIR INTERESTS
48. DON’T TAKE PITCHING ADVICE FROM INVESTORS
49. YOU WOULD NOT TAKE GAMBLING ADVICE FROM A CASINO
50. REALITY CHECK
51. INVESTORS ARE COMMODITIES YOU ARE THE PRIZE
52. CONTINUE ON pitchingmasterclass.com
53. STARTUP FUNDING SOURCES
54. SELF- FUNDING YOUR OWN SAVINGS
55. FFF FRIENDS FOOLS FAMILY NOT EQUITY, NOT LOAN
56. GRANTS PUBLIC & PRIVATE
57. ACCELERATORS The real kind that gives you money (10-500K) - in exchange for a small piece of your equity (0-10%) - as a lump sum payment up front, not in rates, not in-kind services, not depending on milestones or other such bullish!t terms.
58. BUSINESS ANGELS INDIVIDUAL INVESTORS
59. FAMILY OFFICES INDIVIDUAL MONEY UNDER MANAGEMENT TERMS, VERTICALS, TICKET SIZES, STAGES, VARIES WILDLY - ALL DIFFERENT
60. VENTURE CAPITAL / VC INSTITUTIONAL INVESTORS
61. CORPORATE VC / CVC CORPORATE INVESTORS
62. STRATEGIC PARTNER A COMPANY OR A CVC
63. CROWD FUNDING & CROWD FINANCING
64. CROWD FUNDING No equity changes hands, also known as “pre-sales”, depending on the platform you get to keep all the money raised (minus their rake) - even if you don’t reach your funding goal. CROWD FINANCING Equity funding through a large pool of smaller cheques from average people (unsophisticated investors) represented by (hopefully) a single point of contact and contract, terms may vary (wildly).
65. BOOT- STRAPPING FINANCING THROUGH REVENUE
66. FINANCING FOR STARTUPS •Self-funding (Your savings or trust fund) •Friends, Fools, Family (Not a loan, no equity - usually) •Grants (Public & private) •Accelerators (That provide funding) •Business Angels (Well-todo individual or syndicate of such) •Venture Capital (VC) •Corporate VC (CVC) •Strategic Partners (Usually a corporate or CVC) •Crowd Funding (Pre-sales) & Crowd Financing (Equity, pooled) •Bootstrapping (Funding through revenue - Crazy idea, right?)
67. VENTURE CAPITALIST / VC VS BUSINESS ANGEL
68. VENTURE CAPITAL / VC Glori fi ed funds manager, invests other people’s money, gets paid if you die or not (2 & 20), 1 of 10 bets must pay o ff - you’re just a number, can write much larger cheques than Angels, but must see 50-100x returns potential, most o ft en invest in later rounds because of this - investment thesis more risk averse, must be able to purchase signi fi cant stake for it to play out, doesn’t like to co- invest (won’t admit it), usually does follow-on.
69. BUSINESS ANGEL Individual investor investing own money - o ft en exited founders - and because it hurts losing own money, their bets must be spread into more baskets and into smaller cheques than VCs, Angels must be in early round to get enough equity for their smaller cheques, may not need to see potential 10x return, may or may not co-invest, may or may not follow-on (o ft en not).
70. ANGEL SYNDICATE A group of individual investors investing their own money but pooled together in a single investment, can write larger checks than individual Angel, invests in early rounds, may also co-invest with lead VC investor(s), may or may not do follow-on
71. THAT’S THE DIFFERENCE EVERYTHING ELSE IS NOISE
72. CONTINUE ON pitchingmasterclass.com
73. WHAT INVESTORS ARE LOOKING FOR
74. TTT
75. TEAM Compelling persuasive people TRACTION Exciting results so far TREASURE Something special here
76. HOW TO GET TRACTION
77. BUILD A PRODUCT PEOPLE LOVE
78. 50% TRACTION 50% PRODUCT In parallel is the focus of activities found in the most successful YCombinator (YC) startups. PRO TIP:
79. WHAT FOUNDERS PITCH
80. WHAT WE PITCH Problem / Need, Solution, Market Size, Goto Market, Team, Competition, Financials, Ask, BLAH BLAH BLAH…
81. WHAT INVESTORS HEAR
82. WHAT THE VC HEARS 1. Can ”return the fund” money be made here? - Is the problem or market size f*ing huge? 2. Are these the right people who can make me RtF money? - Team has right obsession, mindset, & skillset? 3. Will these people be able to raise money from other investors if I don’t say yes? - Do I fear missing out (FOMO) on this round?
83. “Most VCs are looking for extreme outliers, and when evaluating your startup, they’re asking themselves if this business is one of the 15 businesses that year that will get to $100M in annual revenue.” — Marc Andreessen
84. CLEAR PATH TO 100M ARR? If there is no logical - albeit highly theoretical - path to you being able to eventually generate 100 million in annual revenue, do not waste your time by trying to pitch a VC - they cannot invest. But maybe a Business Angel can and will. REALITY CHECK:
85. WHAT ABOUT URGENCY
86. CREATE URGENCY You o ft en hear you have to describe “why now is the right time". However, all the urgency you really need is created by convincing the investors you will be able to raise a successful funding round without them. Think of VCs as a heard of sheep - fi nd one that will lead (or they believe will lead) and the rest will follow. REALITY CHECK:
87. CONTINUE ON pitchingmasterclass.com
88. HOW TO RAISE MONEY
89. THE FUNDING GAME
90. YOU LEAD
91. INVESTORS FOLLOW
92. MOST INVESTORS ARE INTO A BIT OF S&M
93. THEY EXPECT YOU TO BE TOP NOT BOTTOM
94. SO STAY IN THE DRIVER’S SEAT
95. THIS IS A NUMBERS GAME
96. “I did eighty pitches to di ff erent venture capital fi rms. Eighty. All of them failed.” — Tony Fadell, iPod/iPhone/Nest
97. SHOP AROUND
98. ANYTHING NOT YES IS NO
99. MOVE ON TO THE NEXT ONE
100. DO NOT MARRY THE FIRST YES
101. LEVERAGE THAT YES
102. “Rounds are like restaurants. No one wants to go into an empty restaurant. Get friends, family, the support of strangers to make it feel like this has momentum. Leverage each commit to suggest 1-2 more names. Build the fl ywheel and fi ll the restaurant.” — Harry Stebbings
103. PLAY INVESTOR AGAINST INVESTOR
104. MAKE THEM FEAR MISSING OUT ON YOUR ROUND
105. FOMO
106. AND THEN…
107. BOOM
108. PARTY TIME
109. CLOSE YOUR ROUND
110. AT A VALUATION YOU CAN LIVE WITH
111. ON YOUR TERMS
112. BUILD YOUR DREAM
113. DECK SENT EVERYBODY KNOWS Once you’ve sent a pitch deck to an investor, you should assume any and all investors know you’re raising the round - the investment world is a small one - don’t be surprised if your pitch deck ends up somewhere you didn’t intend it to. REALITY CHECK:
114. DECK SENT CLOCK RUNNING Once you’ve sent a pitch deck to an investor, the round is uno ff i cially running - you’ve now got ca. 3 months to close, a ft er which it is going to become exponentially harder (investors wondering why you haven’t closed yet and thus ghosting you). REALITY CHECK:
115. YOU NOW HAVE TWO BIZ MODELS Congratulations: “Mo’ money, mo’ problems”! - You now have two business models to satisfy; Your own and the business model of your investors. Pray and hope they will stay aligned for the foreseeable future, because if & when they diverge, you’re going to be in for a not so great time. REALITY CHECK:
116. YOU’RE NOW RAISING FOREVER Congratulations: You’ve bought the ticket to ride - You’re now committed to raising rounds inde fi nitely until a liquidation event (until an exit, that is either M&A, IPO, or bankruptcy. Prepare to be fundraising again in about 6-9 months for the next round. This is just how this game works. REALITY CHECK:
117. CONTINUE ON pitchingmasterclass.com
118. WHEN TO RAISE FUNDING
119. WHEN Before you need it <9 months from founding Anytime you have traction 3 2 1
120. BEFORE YOU NEED THE MONEY Because investors can smell if you’re needy and will turn you away so ft ly - and you are going to be agreeing to all sorts of toxic terms just to be able to close. Take a hint from Game Theory: Never play a heavily biased game. PRO TIP:
121. CLOSING TAKES 3-6 MONTHS On average for a normal pre-seed and seed round depending on your location - and your mileage may vary. Be prepared, start raising before your very existence depends on additional capital. Cut your costs, be a cockroach, aim for “Ramen Pro fi table” from day one. REALITY CHECK:
122. RAISE BEFORE NINE MONTHS IN With pre-seed and seed rounds, investors - especially Business Angels - like, nay need, to be in early to a ff ord buying a meaningful amount of your equity. Investors like to believe they’ve found an exotic bud that can bloom magni fi cently with time - and they call a startup with no product-market fi t a ft er >12 months of operating a walking dead. PRO TIP:
123. TRACTION BEATS EVERYTHING Disregard any and all advice if and when you hit traction - it trumps everything. Lead and raise your round on the basis of your traction alone - it’s catnip to investors: There is no better evidence for the validity of your startup than cold hard evidence provided by the market. REALITY CHECK:
124. HOW TO FIND INVESTORS
125. OTHER FOUNDERS Reach out and ask about their experience with their investor, possibility of a warm intro of you to them. ANGEL LIST Look for startups in your vertical and fi nd out who’s investing in it (and see above). Also see if local/regional alternatives. CRUNCHBASE PitchBook, CB Insights, and your local / national listings, e.g. Deutsche Startups (and see all above). LINKEDIN Beware that people w/ “investor” in title o ft en aren’t and that “cold calls” usually won’t fl y, so better get a warm intro. EVENTS Local demo-days, LAUNCH, SxSW, WebSummit, etc where investors are out to meet new founders in-person already.
126. HOW TO CONTACT INVESTORS
127. “There’s a virtual line of thousands of startups wanting to get a meeting with an investor, so a warm intro helps you bump to the top of the list” — VENTURE HACKS
128. ABOUT NDAs
129. DON’T
130. Investors see thousands of di ff erent pitches - many similar to yours - a year and won’t sign anything that will make them legally liable for any information your share - they will think you’re an idiot if you ask them to sign an NDA - so don’t.
131. WARM INTRO From other founders From other investors From Domain Experts 3 2 1
132. NOT ANY OTHER INVESTORS A warm intro to other investors that the investor making the intro has previously co-invested with (and made money with), wants to co-invest with, or is currently co- investing with - ask about their relationship before accepting an intro. REALITY CHECK:
133. Pick up the phone and call everyone you know, who knows investors well, and will listen to you. Email everyone. Ask! Call in all your favours to get the attention of middlemen, someone who can give you a warm introduction: “Can you suggest just one person we should be talking to? We’ll fi nd our own way to him or her, we won’t use your name.” — VENTURE HACKS
134. COLD CALL One-Line Ping Lead with Traction Done the Research 3 2 1
135. ONE LINE PING Reach out on mail, LinkedIn, or Angel List with your High Concept Pitch and ask if you can keep them updated on traction / signi fi cant milestones as a one-liner say once a month - if yes, build relationship over time LEAD WITH TRACTION If you already have meaningful traction, you might want to do a cold call leading with your traction and bluntly asking when they’ll read your deck and take a meeting DONE THE RESEARCH - HUSTLE You might be sh!t out of luck, not connected, alone on a virtual island - then do your research about who would be your ideal investor, reach out to them and explain the hell out of why they are the right to invest
136. ONE-LINE PING MAGIC TRICK Best-case, your metrics are improving greatly week over week - keep at least a couple of weeks of bu ff er for the data before pinging investors, then you know in advance what the data you are sending will look like, investor will think they are experiencing your traction gaining in real-time, catching a potential unicorn in the making - all by themselves! PRO TIP:
137. CONTINUE ON pitchingmasterclass.com
138. PITCHING
139. TL;DR THE ONE SINGLE TAKE-AWAY
140. TL;DR What problem / need are you solving, (for whom), and how are you solving it?
141. THE THREE PITCHES
142. THE THREE PITCHES High-Concept Pitch Elevator Pitch Pitch Deck 3 2 1
143. 1. The High-Concept Pitch gets people’s attention, gives them incentive to let you keep talking 2. The Elevator Pitch convinces investors to ask for (and hopefully read) your Deck 3. The Pitch Deck sells investors on taking a meeting 4. A Meeting will lead to a funding decision THE PITCH PROGRESSION
144. A high-concept pitch introduction captures an investor’s attention, a great elevator pitch gets a meeting, in the meeting you present using your pitch deck.
145. CONTINUE ON pitchingmasterclass.com
146. THE HIGH CONCEPT PITCH
147. “Summarise the company’s business on the back of a business card.” — SEQUOIA CAPITAL
148. THE INTRO
149. HIGH CONCEPT PITCH - Distills your startup’s vision in a single sentence - Also the “We are the X for Y” pitch - The “ice-breaker” when introducing yourself - A shareable “twitter pitch” Also the perfect tool for fans, intermediaries, and investors to help spread the word about your startup
150. BE BRIEF One short sentence… BE FAMILIAR …that a 6 year old can understand DON’T MAKE ME THINK HIGH CONCEPT PITCH
151. IF I DON’T UNDERSTAND I WON’T SHARE IT
152. PRO TIP: What problem / need are you solving, (for whom), and how are you solving it?
153. PROBLEM STATEMENT Your description must instantly give the investor an idea about how big the problem or need / market potential is - do not make them guess! PRO TIP:
154. HIGH CONCEPT PITCH EXAMPLES - “Facebook for dogs.” (Dogster) - “Flickr for video.” (YouTube) - “We network networks.” (Cisco) - “The Chrome of media players.” (Songbird) - “Massively Multiplayer Online Learning.” (Grockit) - “The entrepreneurs behind the entrepreneurs.” (Sequoia) - “Create your own social network.” (Ning)
155. CONTINUE ON pitchingmasterclass.com
156. THE ELEVATOR PITCH
157. https://www.wikiwand.com/en/Elevator_pitch HISTORY
158. THE 4 MAGIC INGREDIENTS
159. THE ELEVATOR PITCH Traction Product Team Social Proof 3 2 1 4
160. PATTERN RECOGNITION The 4 topics most salient to investors
161. KEEP IT SHORT
162. PRO TIP: DON’T OVERDO IT The Elevator Pitch should be somewhere between 30 and 60 seconds - max. Practice, practice, practice.
163. TRACTION
164. TRACTION NUMBERS SPEAK LOUDER THAN WORDS “Traction is a measure of your product’s engagement with its market, a.k.a. product/ market fi t. In order of importance, it is demonstrated through pro fi t, revenue, customers, pilot customers, non-paying users, and veri fi ed hypotheses about customer problems. And their rates of change [over recent months].” - VENTURE HACKS
165. PRO TIP: GOT EPIC TRACTION? Then you’ll most likely be able to raise funding regardless of product, team, or social proof - so lead with that.
166. PRODUCT
167. PRODUCT NOT YOUR PRODUCT MANUAL “High-level” - from 10k feet description - of the product, where it lives (web/mobile/ cloud/physical/combo, etc), what status it is in (PoC, MVP, Alpha, Beta, Version 4, etc), now is not the time to demo (a ft erwards if asked to do so by the investor)
168. TEAM
169. TEAM WHY YOU ARE THE RIGHT FOR THIS Highlight past accomplishments of the team (if your team has been successful before, investors may believe it can be successful again, focus on the team’s complimentary skill-sets and why you are the ones that will succeed, and mention yourself last to segue into you telling the story of how you discovered the problem you’re solving
170. SOCIAL PROOF
171. SOCIAL PROOF PROVE YOU’RE NOT JUST A CRACKPOT TALKING SH!T Investors do not want to be the fi rst to fi nd out that you are full of sh!t. That’s why they’d like you to show that someone else already took a look at your stu ff - Be it in the form of testimonials from paying customers, rave user reviews on social media, publications, patents, domain expert quotes, winning awards - anything that will prove that you have already exposed your solution to the world and the world has already reacted to it. Any founder can talk about their own sh!t - fewer can show other people talking (positively) about their sh!t.
172. PRO TIP: An Elevator Pitch is like a cake recipe - you need to have the right ingredients to make a tasty one, (and in this case it doesn’t really matter in wich order you add them). To make it your own, you can emphasise the ingredients than makes you special; Got a unique personal connection to the Problem? That’s your main ingredient right there! Add the wrong ingredients, and it becomes tasteless.
173. REALITY CHECK: BE QUICK 60 seconds tops (the amount of time at a cocktail party you can talk about yourself before it becomes socially awkward). NEVER FORGET THE 4 INGREDIENTS Add to the 4 only if it adds signi fi cant value (never subtract, still keep the max 60s time).
174. ELEVATOR PITCH EXAMPLE PRODUCT: “Ning lets you create your own social network for anything. For free. In 2 minutes. It's as easy as starting a blog. Try it at: https://ning.com THE WHY (Bonus Point): We built Ning to unlock the great ideas from people all over the world who want to use this amazing medium in their lives. TRACTION: We have over 115,000 user-created networks, and our page views are growing 10% per week [educator notes: nobody gives a sh!t about page views in 2023 though). TEAM + SOCIAL PROOF: We previously raised $44M from Legg Mason and others, including myself. Before Ning, I started Netscape (acquired by AOL for $4.2B) and Opsware (acquired by HP for $1.6B)”
175. CONTINUE ON pitchingmasterclass.com
176. THE PITCH DECK
177. YOUR 13 SLIDES FOR A FUNDING DECISION
178. PITCH DECK CONTENTS
180. ??? what how why
181. IT DOESN’T HAVE TO END HERE
182. FULL CONTENT ON pitchingmasterclass.com