Investors look for painkillers, not vitamins.
- A vitamin is a “nice-to-have.” It provides incremental improvement. Users might like it, but they can live without it.
- A painkiller solves an urgent, costly, “hair-on-fire” problem. Customers need it and are willing to pay to make the pain go away.
Your entire pitch must frame your startup as an essential painkiller.
Part 1: Defining and Articulating the Problem
This is the most critical part of your pitch. If you fail to convince an investor that a significant problem exists, your solution is irrelevant.
1. Be Specific and Relatable (The Story)
Don’t start with a generic, high-level statement. Start with a story or a specific, relatable scenario.
- Weak: “Communication in the construction industry is inefficient.”
- Strong: “On an average commercial construction site, a project manager loses 10 hours every week tracking down paper blueprints and reconciling conflicting versions. This delay costs the project an estimated $50,000 in labor for every week of overruns.”
2. Quantify the Pain (The Data)
Translate the problem into tangible, painful metrics. Investors think in numbers. How much time is wasted? How much money is lost? What is the human cost (e.g., burnout, employee churn)?
- “Businesses in Southeast Asia lose over $2 Billion annually due to failed digital payments at checkout.”
- “SaaS companies with 50-100 employees spend an average of $15,000 per month on software tools that their teams don’t even use.”
- “The average data scientist spends 60% of their time just cleaning and organizing data, not on actual analysis.”
3. Identify Exactly WHO Has the Problem
“Everyone” is not a target market. You must clearly define your initial customer segment. This shows you have a focused go-to-market strategy.
- Weak: “Our product is for marketers.”
- Strong: “Our initial target market is B2B SaaS companies in their growth stage ($5M – $20M ARR) who are struggling to scale their content marketing efforts beyond their founding team.”
Part 2: Proving the Problem is a Market Opportunity
Once you’ve established the pain, you need to prove it’s a pain worth building a billion-dollar company around.
1. Show the Market Size (TAM, SAM, SOM)
This is non-negotiable. You must show investors the scale of the opportunity in financial terms.
- TAM (Total Addressable Market): The total market demand for the problem you’re solving. (e.g., The global spend on cybersecurity is $150B.)
- SAM (Serviceable Addressable Market): The segment of the TAM targeted by your products and services which is within your geographical reach. (e.g., The spend on cloud security for SMEs in North America is $15B.)
- SOM (Serviceable Obtainable Market): The portion of SAM that you can realistically capture in the first 3-5 years. (e.g., We project capturing 2% of the market, representing a $300M revenue opportunity.)
2. Analyze Current “Solutions” and Their Failures
How are people trying to solve this problem right now? Your competition isn’t just other startups; it’s also old-fashioned methods.
- Direct Competitors: Other companies offering a similar solution.
- Indirect Competitors: Companies solving the same problem with a different approach.
- Existing Workarounds: Spreadsheets, manual processes, hiring consultants, or simply ignoring the problem.
Frame these not as threats, but as validation. The existence of competitors proves the market is real. Your job is to explain why their solutions are broken, incomplete, too expensive, or outdated. This carves out the specific space for your unique solution.
Example: “To solve this now, project managers use a combination of WhatsApp for communication, Excel for tracking, and physical paper copies. This is slow, error-prone, and creates a massive information gap between the site and the office. Our solution digitizes and unifies this entire workflow.”
Example “Problem” Slide in a Pitch Deck
A great “Problem” slide is simple, powerful, and data-driven.
<br>
Title: The Construction Industry is Drowning in Paperwork <br>
Headline: Construction firms lose $1.6 Trillion globally each year due to inefficiency and miscommunication. <br>
- The Pain (Quantified):
- đź‘· 10 hours/week wasted by project managers on manual, non-productive tasks.
- $150B is spent annually in the US alone just to rework mistakes made on-site.
- 45% of construction professionals say they spend more time than expected on resolving conflicts between stakeholders.
<br>
The Current “Solutions” are Broken: Spreadsheets, WhatsApp groups, and paper plans create data silos and lead to costly, project-ending errors.
This is a $20 Billion market opportunity in the US & EU alone.
0 Comments