How to include risk factors in a pitch deck?
Opportunity is what drives most people to become entrepreneurs and business owners and to launch startups. A certain amount of naivety may be an asset at the start. Many now hyper-successful founders admit that they may not have started if they knew how hard it was going to be, and what it was going to take.
You cannot get bogged down in overanalyzing everything that could possibly go wrong, or you will probably never get started either. Still, successful entrepreneurs know that in order to succeed and to build something which can really work and last, they must be alert to the risks. It is relatively easy to start a small business and force it to work for a year or five.
Building something which can go really big and last 10 years requires more thought. A healthy balance of optimistic pragmatism. Investors also understand this. They love big aggressive visions and forecasts, but in order to generate real returns and to keep their capital safe, they also must analyze the risks.
To ignore the risks is foolish. They obviously exist. Investors are typically putting in more capital than founders, and have more to lose. Not just their own money, but their reputations, and their investors’ money. They have a legal, if not just moral responsibility to do their due diligence.
As a startup founder seeking capital, it is your job to lay out these risks. You’ll help investors to justify their investment by showing your understanding of them. And what you have done to de-risk this venture and their investment in it.
Pretending that risks don’t exist won’t help you. So, how to include risk factors in a pitch deck?
What Are The Risks For Startups?
The reality is that startups face many risks. Otherwise, they wouldn’t have such a high failure rate.
So, what are the most common risks for startup companies, especially when related to pitching investors and fundraising?
Denying There Are Risks
Perhaps the first risk that is an important prelude to all of the others is accepting and respecting that there are risks.
That isn’t a weakness or a detraction from your idea and the opportunity. It is just intelligent.
If you are serious enough about this venture and mission, then you will find a way to minimize, insulate against and overcome these risks.
Though you can’t do that unless you recognize their existence or potential first.
The number one reason that startup companies or all companies fail for that matter is financing.
See How I Can Help You With Your Fundraising Efforts
- Fundraising Process : get guidance from A to Z.
- Materials : our team creates epic pitch decks and financial models
- Investor Access : connect with the right investors for your business and close them