In the annals of tech history, few success stories rival that of Facebook. Mark Zuckerberg and his team started with a simple idea—to connect college students online—but quickly pivoted into an internet giant:
- 2004: Initially launched as "TheFacebook" exclusively for Harvard students before expanding to other Ivy League universities.
- 2006: Opened to anyone aged 13 and older with a valid email address.
- 2008: Reached 100 million users and became the largest social network in the world.
- 2012: Acquired Instagram, a popular photo-sharing app.
- 2014: Acquired WhatsApp, a messaging app, for $19 billion.
- 2012: Held its initial public offering (IPO), becoming a publicly traded company on the NASDAQ stock exchange. Currently sits at a $762B market cap.
- 2021: Rebranded the company as Meta Platforms, Inc., to reflect its growing focus on the metaverse and virtual reality.
If we delve into Facebook's early days, specifically its 2004 pitch deck aimed at advertisers when it was exclusively serving college students, we can uncover the reasons why the company quickly became extremely enticing to investors and also take home invaluable lessons for creating compelling pitches for early-stage startups.
1. The Use Of Quotes
The nature of a pitch is that you are talking about yourself. Because of this, your audience would always take what you say with a pinch of salt - after all, even if you are the domain expert on your own project, you are hardly objective. That’s why it’s a great idea to include what other people are saying about you if you could. Their words would be taken as stronger evidence than your own.
The first slide of the pitch deck is a quote emphasizing the virality and high user engagement of the platform. After the quote all Eduardo Saverin has to do is to provide data for this claim, and half of his job would be done.
2. User-Centric Growth Story
One of the standout elements in Facebook's 2004 pitch deck was its user-centric narrative. It emphasized how Facebook was rapidly gaining traction among college students, effectively highlighting its growth story. As you craft your pitch deck, consider showcasing your user or customer growth in a similar manner. Investors want to see that there's a demand for your product or service, and illustrating your journey with user metrics can be compelling.
If you have users who value and use your service (engagement), and you are able to attract new users (growth), then your success is almost inevitable (at least in the short term).
3. Data-Backed Claims
The pitch includes user data, demographics, traffic data, engagement data, and growth data. This is solving the same problem as point 1. Facebook is backing their claims of growth, engagement, and virality with real data.
4. Clear Value Proposition
In Facebook's case, its value proposition was evident: it offered college students a way to connect, share, and communicate online. Your pitch deck should clearly communicate your startup's value proposition. What problem does your product or service solve, and how does it improve the lives of your users or customers? Make this message concise and compelling.
It is also offering a clear value proposition to its target clients - the advertisers, which is access to this demographic coupled with very precise targeting. To a degree, even though the demographic of Facebook has changed considerably over the years, the value offering for advertisers hasn’t changed, and Facebook is currently controlling a very significant share of the whole online advertising market.
5. Target Audience Focus
Facebook's 2004 pitch deck was tailored to advertisers looking to reach college students. This focus on the target audience is crucial in any pitch deck. Define your ideal customer or user and explain why your startup is uniquely positioned to serve them. Investors want to know that you've thought deeply about your market.
Saying “everyone” is your potential customer is a big red flag. Even though nearly everyone ended up being Facebook’s customer, initially their unique proposition was the access to college students. This is what they had that other advertisers didn’t.