Investor Deck
Projected ROI
This section outlines the expected Return on Investment (ROI) for potential investors. It provides a quantitative analysis of the returns that investors can anticipate from their investment over a specified period, based on the startup’s performance projections and financial forecasts.
SECTION
Investment and Returns (Vital for Investors)
IMPORTANCE
9
/10
Projected ROI is critical for investors as it quantifies the potential financial return on their investment. It helps them evaluate the attractiveness and feasibility of investing in the startup compared to other opportunities, considering the associated risks and rewards.
WHAT SHOULD BE INCLUDED:
Calculation of ROI: Formula used to calculate ROI, typically ROI=Net Return on InvestmentCost of Investment×100%ROI=Cost of InvestmentNet Return on Investment×100%.
Time Frame: The time period over which the ROI is calculated.
Assumptions Used: Key assumptions made in the financial forecasts that affect the ROI calculation.
Sensitivity Analysis: How changes in key variables like sales volume, costs, or market conditions could affect the ROI.
TIPS
Realistic Assumptions: Ensure that the ROI projections are based on realistic and justifiable assumptions about market growth, sales, and costs.
Comparative Metrics: Provide ROI comparisons with industry benchmarks or alternative investment opportunities.
Visual Representation: Use graphs or charts to illustrate the ROI projections over time, making it easier for investors to visualize potential returns.
EXAMPLES
A software startup: Projects a 20% ROI in three years based on expanding its user base and transitioning to a subscription model, with calculations shown in a detailed financial model.
A real estate tech company: Offers an expected 15% ROI annually, underpinned by robust market demand and revenue growth from new services, providing comparisons to traditional real estate investments.
A health tech company: Demonstrates a potential 25% ROI within five years through scaling operations nationally and significant partnerships, including sensitivity analyses for different market penetration rates.