Pitching isn’t only for raising money—it’s for reaching an agreement, and agreement can yield many good outcomes including sales, partnerships, and new hires.
A great pitch has two goals: establishing that the opportunity is big and showing that you can pull it off.
A good pitch deck tells a compelling story that follows a logical sequence and shows strong business model validation from experiments and research data.
Why is describing “problem” important?
Ten is the optimal number of slides in a PowerPoint presentation because a normal human being cannot comprehend more than ten concepts in a meeting. One of these 10 slides is one slide about pain point.
This is probably one of the most important slides in your deck. The reason why Dave McClure advocates, “pitch the problem, not the solution,” is because too many entrepreneurs try too hard to sell their solutions without educating their potential investors on what the problem is.
In this slide, you will need to address the following questions as simple and concise as you can be:
What is the problem?
How do you know if it’s a problem?
Who are you solving this problem for?
How are they trying to solve the pain currently?
You need to understand the way your company solves the problem – by focusing on the emerging of the problem through identification of the reasons behind its emerging or by focusing on the existing inadequate solutions to the problem.
What are the challenges?
The problem, however, comes with the presentation of the Problem-Solution equation. One of the biggest mistakes that entrepreneurs make in regards to this topic comes from the fact that they tend to focus on the solution before they explain the problem. This is a critical mistake and can ruin your pitch.
Explaining a solution to a problem that is not clearly identified and not completely understood by the investors and the audience makes absolutely no sense. Even if you have the most effective solution, nobody will understand the need of it, if the problem that it solves is not explicitly defined.
If the investors don’t understand the problem, its scale and the group of potential customers that face this problem, they will not understand why solving this problem is that important and why anyone will pay for it.
What goes in “pain point” slide?
Think of a problem statement as a proof marking.
Try a story about a person who has a specific example of the problem. Be concise but not bland.
One of the key things to talk about in your problem statement….is why the issue is a problem in the first place? For the person reading it to completely understand why the solution is necessary.
Lead with the need
In order to grab the attention of your audience from the outset, immediately identify the business need you are trying to address.
Talk about the problem & current solutions – What need do you fill? For whom? What are the other solutions? Who else is already doing this, and how are they going about it and what are they not getting right or doing wrong?
The message that you want to give to your investors is that you have not only identified a real “pain” that is worth solving but also are passionate about it and that you have got a lot of insights about it through your conversations with the prospects.