How to show your competition in a pitch deck? In other words, what’s the best way to show your competition in your pitch deck?
Showing your competition is one of the core components of creating a pitch deck, and making any pitch to startup investors.
This can often be overlooked and rushed through as entrepreneurs get busy focusing on showing off their idea and product. Which can be a big mistake.
In fact, this might end up being one of the most critical slides when it comes to convincing investors to fund your venture. Or the one which becomes your Achilles’ Heel and sabotages everything else that you are doing so well.
The Ultimate Guide To Pitch Decks
The key to a successful investor pitch is not just knowing where to put this information in your deck of slides, but also how to position yourself against your competition the right way.
If you haven’t embraced and aced this slide yet, here’s what you need to know before you try pitching investors.
Here is the content that we will cover in this post. Let’s get started.
- 1. Yes, You Have Competition!
- 2. Second Mover Advantage
- 2. Leverage, Don’t Hide Your Competition
- 3. Savvy Investors Know
- 4. Amount Raised
- 5. Valuation
- 6. Proof It Works
- 7. Investors Involved
- 8. FOMO
- 9. Potential M&A
- 10. Exits
- 11. Where To Show Your Competition In A Pitch Deck
- 12. Presenting Your Competition In Your Pitch Deck
- 13. How Many Competitors To Show
- 14. Which Competitors To Show
- 15. Your Competitive Advantage
- 16. Summary
Yes, You Have Competition!
You have competition. If you claim that you don’t, investors are not going to take you seriously.
It is pretty shocking how many aspiring entrepreneurs think that they’ve come up with a genius, first-of-its-kind idea, and run out to start a company and pitch it, without even spending five minutes on Google to see all of the existing competitors in the space.
It is not uncommon for investors to hear pitches like these for the same idea multiple times in a week.
The painful truth is that ideas are cheap. What really makes the difference is the team and execution.
Even in the rare case where you may be creating something brand new, or a whole new market, there are likely other teams and companies currently working on something very similar.
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You can bet that if you are successful and make progress with your idea, the competition won’t be far behind. That will likely both come in the form of giant incumbents whose territory you are stepping into. As well as even newer and scrappier founders following behind you.
Keep in mind that in fundraising, storytelling is everything. In this regard, for a winning pitch deck to help you here, take a look at the template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
Remember to unlock the pitch deck template that is being used by founders around the world to raise millions below.
Second Mover Advantage
Not being first isn’t necessarily a bad thing. That doesn’t mean you won’t want to raise funds to get out ahead and dominate your space or buy them up.
Still, while there used to be a lot of hype about first mover advantage, and there are still great pros of moving fast, more experienced entrepreneurs are learning that second mover advantage can be even better.
It means not having to educate the market and investors first. You won’t be frustrated by being years ahead of your time. It is likely you’ll access more money, more easily. Providing you are bringing value and capability to the space.
Leverage, Don’t Hide Your Competition
Since we’ve established that there is competition, all that can be done is to make the most of it.
Savvy Investors Know
The best investors, and those that can probably help your startup the most, will know your space and the players. They may even know people working on similar things behind the scenes that you aren’t aware of. Their perspective can allow them to connect a lot more of the dots on the journey.
So, you can’t hide it. Instead, use your competition slide to show that you know your space.
Even if there are exceptions you can wow them with your in-depth knowledge.
One of the great ways to leverage your competitors is to show how much they’ve raised. How much have they raised recently, and at your stage?
This can quickly help you to establish the credibility of your space and venture, and justify the amount you are asking to raise in this funding round.
What valuations have your competitors been given recently, and at this stage? If they are coming out of the gate with a $1B valuation at their Seed round, that can make a huge difference. Compare that to other spaces where startups are emerging with valuations in the low millions.
This will certainly help with the terms you can ask for, in addition to the volume of capital.
Proof It Works
Competitors show proof of concept. This works even better if they are delivering real products and selling. That is better than others, simply still in the theory and testing stage.
This shows that it isn’t just a dream. The technology is possible, and it works.
What notable investors have invested in the competition that has gone ahead of you?
This lends credibility. The venture capital space can also be pretty competitive. So, showing that other well-known investors have gotten into this already, can add value and motivation, and drive up the competitiveness to participate in your round.
Building on the above, showing how well competitors have done, how well they’ve grown, and how that has been a win for other investors, will all create a fear of missing out in this round.
Investors may be kicking themselves for not investing in that company, and missing out on that deal. You are giving them a chance to make up for it.
This sense of urgency can be critical for getting potential investors to take action, move through your funnel, and build momentum in your campaign.
The other players in your market are not necessarily your enemies. In fact, they can become key allies, partners, and potential partners for mergers or acquirers.
This may at least subconsciously indicate to investors that there can be great scale ahead, and demand for your entire business, not just your products. After all, in most cases, investors aren’t really making money or getting their capital back until there is a major liquidity event.
Similarly, showing other startups that have had great success in achieving exits around this space can help a lot.
Whether that is in the form of successful IPOs or big dollars in M&A transactions, it plants the idea of what this investment and company could ultimately be worth. As well as proving demand for it.
Where To Show Your Competition In A Pitch Deck
The most obvious and notable way to show your competition in a pitch deck is on your competition slide.
This is typically around the middle of your pitch deck. After you’ve set up the story, talked about the size of the market, and the niche you are targeting.
It is often followed by slides including your financial projections, business model, your ask, and call to action.
Presenting Your Competition In Your Pitch Deck
Successful pitch decks are obvious, simple, and fast to digest. You only have a couple of seconds per slide to hold investor attention and convey your point.
The easiest and smartest way to do this with this slide is to use an image. Use a graph or similar chart to plot and show your competition in a pitch deck. You can use logos of your competitors for speed and credibility if they will be recognized.
Keep it basic.
You may also want to leverage sales psychology through your colors and fonts here. What other startups have been successful, and investors aspire to repeat their success? If you can find any crossover between your existing branding and theirs, this may help.
How Many Competitors To Show
How many competitors should you show in your startup’s pitch deck?
Again, you must keep your pitch deck simple and quick to interpret. That is your overriding decision guide.
Depending on your industry, how much competition you have, and the points we covered above that you can leverage to support your raise, you may want to include three to five competitors on this slide.
Do not create distractions or more rabbit holes for investors to go down. Just use the minimum amount to convey the main point.
Which Competitors To Show
Which competitors should you choose to show in your pitch deck’s competition slide?
Review the leverage and positioning points again. This is about strategically supporting and setting up your ask and your preferred terms from your ideal investors.
Which is most important to include may depend on your startup’s stage to some extent, and which round you are raising now.
In the early stages, this may be mostly about proving your concept, problem, and market demand. It may also be important to set some mental benchmarks for valuation and the amount you want to raise. You can position against this to raise even more.
Especially in later funding rounds, you may need to paint more of a picture of the potential end game. Including competitors that have become public companies with big IPOs and notable M&A deals. And, that’s how to show your competition in a pitch deck.
Ready for more in-depth information on how to show your competitive landscape in a pitch deck? Check out this video I have created where I explain in detail how to use the competition information to make your pitch deck all the more compelling.
Your Competitive Advantage
You may or may not accomplish this with a single competitor slide. So, as a follow-up, you can use the second slide in this section to specifically display your competitive advantage in the marketplace.
Be sure this is a substantial improvement on existing solutions, and a defensible one. If you are going to go bigger, and survive price and advertising wars, you must have a significant lead. 10x to 100x better than what is in play already. Be wary of competing on price alone. It is rarely sustainable.
Having a strong moat will protect investor capital and create value in your company for them.
Again, you may use a simple graphic here. Showing your startup up and to the right, in comparison to your competition. You may include one big call-out data point that conveys how you are so much more superior, and valuable.
Other ways that you can convey your competitive advantage throughout your pitch deck may include:
- Using your team slide to show that you have the best and most accomplished team in your industry (from technical domain experience to business operations at this level)
- Showing the past investors and advisors you have brought on board
- Using your product slide to point out the one to three amazing benefits that have great value
- Listing your IP that you have patented and trademarked, and have legally protected
- Showing how you are growing faster than your competition on your traction slide
- Leveraging your Use of Funds slide to show how you will use this capital to get even further ahead
- Listing any awards, competitions, or grants your startup has won
Knowing how to show your competition in a pitch deck correctly and well in your pitch deck can significantly impact the outcome of your pitches and fundraising campaign.
Not only can it make all the difference between a yes and a no at each pitch, but in how much you can raise, how much each investor is willing to put in, the terms they will accept, and the valuation you will receive.
It can make or break your efforts to pull in the most valuable investors that you really want to help to drive your business forward.
Understand who your competition is, where and how to display them in your deck, and use them to your advantage.
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