Pitch Decks - #AI is not The Solution

Avoiding Common Issues in Pitch Decks - #AI is NOT the Solution

As part of the Avoiding Common Issues in Startups series, let’s talk about a very overused buzzword and technology: AI.

“Hang on, my app uses AI, and fortunes are being made daily in AI, what do you mean AI is NOT the solution,” you ask? Bear with us, we’ll explain.?

But, first, let me tell you who “we” are. I want to recognize my friend and fellow The Venture Mentoring Team #mentor, Jon Langbert , for co-authoring this article with me. He is a serial entrepreneur with multiple successful exits and is now an investor and runs the @SenecaSyndicate. He has invaluable insights into how investors look at businesses and pitch decks. I truly appreciate him taking the time to help me with this article and share his years of experience in the entrepreneurial ecosystem.

AI in the Startup Ecosystem

First and foremost, you should know that…

there is severe AI fatigue in the #Startup ecosystem right now.?

Yes, AI is real, game-changing, and here to stay, but, like it or not, we see it way too much - to the point that we are almost numb to it. So, you have to be very careful how you use the term, AI, in your #PitchDeck.?

Where not to put AI?

If you have been following the series on #PitchDecks, you have hopefully spent a lot of time getting The Problem stated in a way that is in non-technical, layman’s terms. As mentioned before, the same needs to happen with The Solution statement.??

Oftentimes, the #Founder says that AI is “the solution,” and there are a lot of terms and acronyms thrown in The Solution, like LLM, ML, Tokens, etc. I am not sure how else to say this, so here goes…

AI isn’t the solution. AI is how the solution is implemented.

There is a subtle, but very important, difference. If that doesn’t make sense, let us explain.?

Using Business Terms

You have carefully crafted a Problem statement that is clear and concise in business terms that someone outside of your company and industry can easily comprehend. It isn’t stated in technical terms using complicated jargon. (Remember: Complexity = Risk.)

The Solution should be the same. We have already talked about explaining The Problem and The Solution in terms that are understandable by someone outside your industry in previous articles, so we won’t dive into that again here.?

Instead, let’s walk through an example of using “business terms” to describe The Solution.?

If you have an app that uses AI to help train users, The Problem is that the staff in your industry is not effectively trained and there are costs, likely in terms of time, money, customer experience, and/or safety, associated with that problem. The Solution is that you have an app that adequately trains staff in your industry in an effective way to improve productivity, profitability, customer experience, and/or safety.?

Notice that there is nothing about AI in The Solution.?

It is perfectly ok to say that The Solution is implemented using AI, or is more effective because of AI, but AI, itself, is not the solution.

I realize that this example grossly oversimplifies your company and business idea, but, hopefully, it gets the point across. In most cases, AI is a tool, just like the Internet, the cloud, computers, and pencils. A founder would seem out-of-touch if they bragged about how they’ve created a website for their business, and it’s just a matter of days before a start-up bragging about their AI implementation will sound the same.

Summary

AI is everywhere now and is a part of a majority of new business ideas. Unfortunately, that means that the audience of your pitch has seen a lot of AI ideas in a short amount of time, and just saying that your business is using AI is not enough to garner interest. In fact, being an Operations Person, I watched a webinar last week that was talking about important Metrics for VCs. One thing that was very interesting to me is a reference that they evaluate AI startups with more scrutiny because of the oversaturation of AI in the Startup Ecosystem right now. Be aware of that.?

Don’t hide AI in your pitch, just put it in the correct context and realize that it is not a competitive advantage by itself any longer.?

Questions? Comments? Put them in a comment below.

Need help with your Pitch Deck? Direct Message me and we can talk.

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