The key elements of a pitch deck for life science VCs

If you're an early-stage startup speaking to prospective partners, you may have heard something along the lines of "This is really interesting, come back to us when you have x".  In many cases, you're going to need early-stage investors to fund those killer experiments and de-risk your work. But, how will you attract VC investors for your project? What are the data and content you need to show them to catch their attention? 

A pitch deck is an invaluable tool for delivering your ideas to an audience in an engaging way. Though it's often the first impression you have on investors, your pitch deck should be well-developed only after you’ve fleshed out every element of your business – ideally after completing a strategic planning tool like a business model canvas or even a full business plan.

At Probatech, we help startups to develop key tools for finding and communicating with partners and investors. In this post, we will guide you through the process and the key elements needed for a compelling pitch deck.

A) Do the pre-work 

Clear your mind and structure the relevant information for your audience.

Before your start working on your presentation, it is important to have an outline of your pitch deck in mind… Why? Because a pitch deck gives you a short opportunity to lay out a clear and compelling narrative of the market, its unmet needs and a strategy of how you’re going to meet them. It’s also critical that you have an idea of what questions investors and other stakeholders will want to ask about it.  

The following topics are pertinent to a pitch deck sent to Life Sciences investors: 

• Present Company overview and mission background
• Problem or Opportunity
• Your Solution
• The market and commercial opportunity
• Your business model
• Your go-to-market and/or development strategy
• The competitive landscape
• Your intellectual property (IP) strategy
• "The Ask" - how much funding you're asking for

Start by sketching out an outline and make sure you cover these points.

B) Create the deck

You may wish to identify which components warrant extra emphasis based on your situation.

Here’s your opportunity to let investors know WHY they should invest in your idea and what it will mean for the world when it lives and grows. 

Let’s dive into each of the key elements of your pitch deck:

#1: Company overview / Executive Summary

Use this to provide a brief summary of the entire pitch deck - usually in a single slide.   It should explain your purpose, mission, and trajectory, giving investors clarity and a solid basis for your project.

• Describe the company's emphasis and mission.
• Tell them where the technology came from, especially if it came from a well-known institution.
• Describe where you are in the development process right now (e.g. preclinical stage or Phase 1 clinical trials)
• Tell them your plans and what your "Ask" is (how much money are you hoping to raise)

We’ll typically include a slide like this when a pitch deck is meant to be read (rather than presented) - this serves as the hook to grab an investor’s attention.

#2: The Team behind the work

While investors want to hear your story, they’re also looking to hear why this particular team is the one that is going to take you to success. 

Tip: You can add this section at the beginning or at the end of your deck.

• Highlight your senior management team's relevant experience and previous successes.
• Describe the experience of your Advisors/Consultants/Board Members, if any are formed.
• Discuss openly whether or not your team is complete, who else is needed, what backgrounds are required, and how/when you will recruit them.
• Describe any key partnerships that have been formed or are in the process of being formed.

#3 Problem/Opportunity

This is the place to introduce the big problem that you’re trying to address.

• Make sure it is described in a way that allows investors to feel or understand the pain that this problem causes.
• Highlight the most relevant stakeholders (and potential customers) and show that you understand the problem from their perspective 
• Describe the costs and scale of the problem (e.g. incidence/prevalence), the limitations and inconveniences of existing solutions, and the unmet needs/opportunities for improvement.

#4 Your solution (include data)

Healthcare investors want to see data on your new technology early in a pitch, but keep in mind that this is an investor presentation, NOT a lab meeting, and the challenge is to clearly present a few crucial details rather than overwhelm the audience.

• Describe the value proposition of your product or technology and how it addresses a significant need - see our blog post on value propositions.
• Show evidence, such as your own data, literature, or prototype testing, demonstrating that your technology or product works, or has a very high chance of success.
• Describe the mechanism of action (in a non-confidential form) 

• Remember: You are not forced to disclose any proprietary or confidential information at this time. To learn more about how you can pitch your ideas without someone stealing them, read our blog post.

#5 Market opportunity

Here’s your opportunity to entice the investors by showing them the commercial potential of what you’re doing. However, a word of caution: it irritates investors when an entrepreneur touting a discovery-stage program (for example) presents multiple slides on how big the market for cancer drugs is. This slide should really be used to describe how you can capture a share of a rational and focused market segment. Unless you have a unique or underappreciated perspective on a disease or market, don't waste time on the macro metrics of these diseases, especially if you're in drug discovery. You’re time is better spent doing the following:

• Estimate the market size and be able to explain how you reached this estimate, providing credible sources only.  
• Describe your target market and your secondary market – explain how you will reach your customers.
• Explain your rationale for choosing this market and describe why the timing is ideal for your product.

#6 Go-to-market strategy/business model

All startup plans should include a long-term business plan that tackles:

• The business model: A description of your income strategy - how your startup will capture some of the value it creates and deliver a return to investors.  Examples could be a co-development deal, a licensing deal or an acquisition of your company. 
• The development plan and/or go-to-market strategy: A plan for the experiments you will run and the technical developments required, together with associated timelines.  In our industry, this will also include a number of regulatory hurdles that you must overcome.  Finally, you should indicate any partnerships that will be required to be successful.

​​In other words, if you want investors to help you bring your vision to life, you need a business plan that shows how they'll be able to get their money back in the future.

A quality business model and go-to-market strategy requires some research and planning, and other time-consuming tasks on your part. At Probatech, we recommend starting with a value proposition, and then using a framework like a business model canvas to get started. For more information, contact us!

#7 Competitive landscape 

A competitive landscape analysis is an essential component of your company's strategy. You gain insight into the market as a whole as well as your own company's position within it by identifying your competition and assessing your strategies. Remember, those insights will give investors a secure understanding of how your company is different from the competition. 

• Compile a list of competitors and substitutes to your solution.
• Discuss stakeholders' willingness to depart from the current status quo and the significance of your advantages. Elaborate on your product's points of differentiation.
• Explain why no one has yet resolved this issue.
• Describe products that may emerge in the future and how you’re defended against them.

#8 IP strategy

Early investors aren't just looking for patent application filing dates, competitive IP figures, or your current IP activity. They're also interested in your IP thought process - especially if you're just starting out.

They would like to know that you've considered your innovation from an intellectual property standpoint and that you have a plan in mind to take those steps when the moment arrives.

• Present the patent applications that have been submitted or issued, as well as whether or not you have trade secrets/know how - Investors appreciate this information to understand where they are investing, the potential risks, and the barriers to market entry you’ve created.
• Discuss findings from a patentability analysis or "Freedom to Operate" (FTO) opinion, if available.
• Note that you do not need to share any confidential information at this time unless you are conducting Due Diligence or already have a signed CDA in place.  However, you must provide enough information for investors to evaluate your technology and/or product candidates.

#9 Funding required/use of proceeds - “The Ask”

Finish with credible exit strategies. Prepare to outline how much equity money you believe this deal will require to reach a liquidity event and/or a value inflection point (examples could be: licensing deals, mergers, partnerships/alliances of co-discovery, development, etc.). 

• Describe how much money has been raised so far and what it has been used for.
• Share your estimates for future funding needs to execute your business plan and to reach your future milestones.

C) Gather information and tailor your pitch

Before the pitch

Do some research and find out as much as you can about an investors’ interests or habits.  Then, you can use that information to tailor your pitch before you send it or present it.

If you have the opportunity to meet an investor by zoom or face-to-face, be sure to work on the “unspoken” characteristics below.

On top of the information contained within your slides, investors will observe other characteristics. It is important to be genuine and authentic with your answers, as these are qualities investors are looking for. They want to know whether they can trust you and your team. The main characteristics investors might look for in an l entrepreneur are:

• Enthusiasm and passion for your work
• Intricate and current knowledge of your business, product, and market
• Good strategic thinking
• Leadership characteristics, ability to inspire others and ability to execute
• Willingness to receive advice, listen and learn
• Culture fit

Conclusion

It is important to mention that this post is not intended to be a “one size fits all” guide, but it does give you a strong foundation for writing a pitch deck. Some elements are specific to biotech start-ups and others are widely used across industries. 

We hope this helps you create a winning pitch deck for your startup. If you’re interested in more information or support, please contact us! We’re committed to helping early-stage companies succeed and would love to hear from you.

‍

References:

1. https://www.linkedin.com/pulse/what-put-biotech-investor-pitch-deck-craig-shimasaki/
2. https://www.massbio.org/news/recent-news/pitch-deck-tips-for-biotech-and-medtech-start-ups/
3. https://lifescivc.com/2013/09/ten-tips-for-raising-startup-capital-in-biotech/
4. https://lifescivc.com/2011/05/starting-a-biotech-advice-for-pitching-vcs/
5. https://guykawasaki.com/the-only-10-slides-you-need-in-your-pitch/
6. https://blog.lifesciencenation.com/2014/11/20/11-tips-for-creating-a-successful-pitch-deck/
7. https://patentsintegrated.com/crafting-ip-strategy-slide-pitch-deck/ 

‍