Seed Rounds of financing are essential. They are the very first round of financing that you’re going to be getting for your startup, from outside capital, from investors. In today’s video, we’re going to be breaking it down for you so that you get a good understanding as to what is going to be the pitch deck that you’re going to require to put together to come out with a bang, to convince those investors and to get that money in the bank.
First and foremost, what are seed rounds? Seed rounds are any round of financing before a Series A. Series A rounds are, in a sense, the very first institutional round that you’re going to be doing with your business when you have venture capital firms, private equity firms investing.
Seed rounds typically go anywhere from 50,000 all the way up to million, and the valuation is all over the place where you’re going to sometimes have an equity round, where you’re pricing the round, and that could be anywhere between $3 million all the way to
0 million.
Now, in a seed round, typically, the investor is going to be more interested in the founding team in the roadmap that you have. It’s not so much about historicals, what you’re doing, and where you’re coming from. It’s all about the future, and it’s about possibilities.
The investors that you’re going to go after when we are thinking about a seed round and who those investors are who are going to be reviewing your pitch deck.
The other ones that are going to be investing at a Seed Stage could be angel groups, which is a collective group of people. There are some of those former groups like the Houston Angel Network, the New York Angels. Those are angel groups that invest in Seed Stage companies. The other ones that you’re going to go after are venture capital firms and micro-venture capital firms.
Seed Stage pitch decks ultimately could be seen as a brochure. They’re going to be between 15 to 25 slides, and that’s it. Obviously, you want to have the right type of flow, the right type of structure and in a way which is compelling, so it needs to be gradually getting the investor excited. You don’t want to start with a bang at the beginning because then it’s going downhill from there.
It’s like a story that you’re sharing that ends with a very powerful end that is going to trigger more meetings, or that is going to trigger more questions because, at the end of the day, more questions that you get to address, more concerns that you’re also able to put out of the way. When there are no concerns is when the money is in the bank, and that’s why and what you want to go after.
Next is gathering all your data. Before you even go into preparing the pitch deck, you want to gather all the data; you want to understand what will be those key pieces of information that you’re going to be including in your presentation, whether it’s metrics, whether it’s milestones, but you need to have those in a way that they’re accurate and in a way that you could validate those whenever the investor is asking you.
Next, you want to choose how you want to design your pitch deck. You definitely want to use a nice balance between visuals as well as text because when it’s too texty, it’s going to be overwhelming for the investor. Remember, investors only spend two minutes and 41 seconds (2:41) reviewing those pitch decks based on data. That’s it. They’re literally skimming through the presentation, so you need to put the presentation in a way in which the flow is super nice when you’re skimming through it, and right away, they’re going to get what you’re doing. That’s why, as they say: an image or a visual could be worth a million words.
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