How to make fundraising suck a little less
Let's start with the bad news: fundraising is hard. Everything, from going through the VC funnel to nailing the content in your presentation — "hard".
I know I know…you would rather build product. But you need that money, right? So let’s get to it.
In January, I had the opportunity to help a friend before he started his fundraising process. I tried to find good examples of decks online. There were some useful posts out there. Most only showed collections of individual decks, though.
In most scenarios, companies would have a good slide for one thing but bad ones for others. Thus, I decided to compile and curate the ones I thought were best in a single pitch deck.
For the purposes of this post, I’ll only address what most founders do wrong when building their deck. Which is not knowing how to frame their narrative.
If you’re an entrepreneur, I assume you know your metrics. I also assume you know your narrative, but you would like to see some examples of how successful companies did it before you.
By the way, the order of the slides is a big thing for a lot of people so I’ll say this: it depends on the investor. If you have an investor lined up, make sure to check on social media or her blog if she prefers a particular slide order.
According to DocSend here, most companies that raise money follow the order I’ll use. Other investors like Mark Suster favor a different order. So if you are pitching Mark put your team slide first, if not, he won’t appreciate it. By the way, I agree with him. But still think that as an entrepreneur you should adapt to the likes the investor you are pitching.
For this post, I’ll use Frank Bien and Tom Tunguz recommended order, found in their book Winning With Data (page 136). I made some tweaks, though:
Opening Slide: Zuora
Zuora’s isn’t a pitch deck but a sales deck for their clients. It’s an awesome deck so might as well include it. The first slide of any deck should include contact, social media handle, and company address. As for the image, it should be something enticing usually with the company’s name and a tagline. Get creative.
1- Problem: Airbnb
Airbnb’s is cool because they made it simple. Three components of a problem that everyone can relate to and understand.
2- Solution: Youtube
Youtube’s approach is also simple. They stated how they were different in three key aspects.
*According to Tom and Frank, you include engagement and acquisition metrics in here. You could add that to your slide or put it on the next one. In the case of Youtube these were their engagement metrics:
3- Why Now: Zuora
It’s important to say why your company is relevant today and will be tomorrow. In their sales deck, Zuora shows what has changed over the years. This is key because according to their deck we are at a “relationship-centric era”. Thus, making their product relevant to their market right now.
4- Market Size: Standard Treasury
In my experience, this is the slide where most founders get confused. A good market size slide should include a logic Total Addressable Market (TAM). I am a fan of the bottoms up approach but different investors like different things. Standard Treasury includes both a bottoms up and a top down calculation of its market size. A bottoms up TAM and a top down on whole industry revenue. This is the smartest way to approach this slide to mitigate against all opinions.
5- Product: Crew
Crew included their product functionality in three separate slides. I would recommend using a video. Images work too. These are Crew’s:
- Bonus — If you have satisfied customers who are willing to give a quote on how awesome your product is, include them! A list of big name customers helps too. Here’s a shoutout in Pendo’s deck.
LinkedIn has the win here. They included name, role, and previous accomplishments. I would suggest adding a picture of each team member in the same format to make it more relatable.
Don’t worry if your team doesn’t have a similar track record. Just show why your team rocks in a similar format.
7- Business Model: Buzzfeed
Buzzfeed makes it simple. They state their different revenue channels and that’s it.
* Tom and Frank would tell you to include your pricing strategy and unit economics (how much money you make per customer) here.
- Bonus- I would throw in an Acquisition strategy identical to the one Front used so your investors know you have an experimentation mindset. Plus it helps visualize how you will gain more traction. The “we will iterate on those and double down on the winners” is brilliant and most people miss the opportunity to put something similar.
8- Competition: Standard Treasury
I’ve seen many pitches were the entrepreneurs ignore their competition. Don’t be that entrepreneur. Standard Treasury did a great job organizing their competition. They put them in three different segments within their industry. That makes it easier to illustrate how you differentiate from your competition. Front also did a great job with a more traditional approach of showing competition on an axis.
9- Financials: Pendo
Pendo shows its revenue going up and to the right. That’s what everyone wants to see :)
I would recommend including a slide with how much money you are raising. (Front)
I also vote for always including a product development roadmap for the next 12–18 months. (Pendo)
Here is the sample deck I created with all these slides. Copy and tweak it as you desire. I recommend getting a designer on board to do this for your company.
After you’re done, show your deck to every person you consider may have good insight and test if your message is coming across. Good luck fundraising!
BTW, if you are fundraising let me know and I might be able to help :)