The different essential documents for startups and the uses of each.
When presenting your business to potential investors or partners there are several document formats that can be used. It is important to know the difference between them to know how to use them correctly. There are three types of documents:
|Pitch deck||Business Plan|
|Length||10-20 slides||10-100 pages*|
|Design||Highly visual||Highly text-based|
|Main goal||Get investorsÆ attention||Self-reference guide & give investors
information about your company
As you can see, a pitch deck is often used to get the attention of an investor. Since you will be sending out a pitch deck much more often than a business plan, a pitch deck is arguably more important. However, a pitch deck is usually created after the business plan is created. The business plan is the basis of your pitch deck and is therefore equally important. Generally, you should only send a business plan when an investor explicitly asks for it.
However, let's be clear, back in the day, the business plan was the most important aspect for investors, as it let them know how you think and what plans you might have for the future. As investors see lots of startups and ideas every day, Venture Capital and Private Equity funds have lots of interns and analysts who will summarise a long business plan in an executive summary. Investors are now more inclined to go for pitch decks and one-page executive summaries.
Nevertheless, if you intend to raise a large amount of capital, investors will conduct a due diligence process before investing in your company. Have a business plan ready for these situations, as you will most likely be asked for one.
1-page that highlights what youÆre pitching for
in as little space as possible
- itÆs essentially the written version of the elevator pitch
|Business idea||Strategic plan|