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Title slide from Opendoor’s deck — All slides from Opendoor/Twitter

Opendoor Series-A Pitch Deck Is an Example You Should Follow

Opendoor will soon IPO at a $4.8B valuation. Let’s look at the deck that got them $10M in 2014

Nicolas Carteron
Sep 16 · 8 min read

Yesterday, Opendoor announced that it would go public through a reverse merger with special purpose acquisition company (SPAC) IPOB, another multi-billion listing going the trendy SPAC way.

The terms of the deal value Opendoor at a unicorny $4.8 billion and the market seem to have reacted positively to the news: shares of IPOB soared 35% on Tuesday.

In 2014, Opendoor had raised $10M with, among many, YCombinator and Khosla Ventures. The pitch deck they used at the time has surfaced on Twitter. It is a masterful example of how to tell a compelling story that respects proper design principles.

It’s a deck every startup should try to emulate, and it’s worth going through it in more details.

If you want to keep up with my latest pitch deck teardowns and also get analyses, news, and discussions about startup finance, fundraising, and venture capital directly in your inbox, sign up for my newsletter Fundraisedd.

Opendoor, founded in 2014

Stage of financing: Series-A

Stage of the company: Early-Stage, development phase.

Lead investors: Y Combinator, Khosla Ventures

Amount raised: $10M

Total amount raised pre-IPO: $1.5B

1. Title slide

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The title slide is eye-catching and contains all the essential elements:

  • The brand and logo are prominent
  • The value proposition is summarised in a 5-word, effective slogan
  • The purpose of the deck is made clear with Series A Financing

2. Team slide

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Starting the deck with a team slide is a bold move that I love.

The most common advice you see online is that you should start your deck with the problem, then address your solution and the opportunity size, and introduce your team near the end of the presentation.

However, at the start of an entrepreneurial journey, your story revolves entirely around co-founders and early employees. Until you build a strong track record of positive financial results, you and your team are your company’s greatest assets.

All members of Opendoor’s founding team have impressive backgrounds in relevant business areas. This provides potential investors with confidence that the team will be able to execute properly on their plan.

The deck starts on a strong footing.

Using the first slide to promote your greatest asset should be the norm.

3. The problem

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Having asserted the ability of the team and built confidence in the reader, now they address the problem.

Real estate is a professional’s business. The industry is worth billions, and amateurs have no place in it.

Had Opendoor started their deck with the problem, potential investors might have discarded them thinking “that’s too big of an issue for such a small company.”

By changing the slide order, they implicitly and brilliantly addressed this issue.

The slide itself is clean and to-the-point. 3 key words highlight the major issues faced when selling your home.

We can already assume that Opendoor will address each of these keywords separately in their deck later on.

At the bottom of the slide, you will notice a summary of the main take-away. This design element repeats throughout the deck and is a great way to emphasise your argument efficiently.

4. Today aka Current state of affairs

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Having posed liquidity as a major problem of the residential real estate industry, Opendoor now uses a slide to expand on the issue in more detail.

We will see that this slide design allows them to elegantly introduce their solution 2 slides down the way.

Since Opendoor’s mission is to optimise a process, presenting the problem as a timeline is a smart decision. You understand the complexity with your eyes before your brain even has a chance to read the copy.

The chronological approach gives a sense of slowness and “old-fashioned” industry that is ripe for disruption.

5. Market size

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Having presented the problem, it is common practice to price it to show that the proposition is juicy.

One can easily see in less than 10 seconds that the market opportunity is huge.

Not only is it large globally, but each deal is also worth a few hundred thousands of dollars and there are millions of them happening each year.

We can infer from this that people going through the process of selling their homes will be willing to optimise their costs and/or pay for efficient services.

6. Our experience aka The solution

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By changing the background colour to black, this slide automatically stands out and attracts attention.

We can see immediately that the process has been reduced to 3 simple steps completed in a matter of days (compared to months in the current situation).

Opendoor addresses here the first problem they had outlined previously, namely that the process is lengthy.

The value proposition as far as process optimisation goes is obvious from the design of the slide.

7 & 8 Proof of need/acceptance

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When you make a bold claim, you must substantiate it.

Being the professionals that they are, Opendoor knows that it needs to prove that their solution is in high demand.

They do this right after the solution by comparing and contrasting real estate to other areas of domestic investment and extrapolating a fundamental user behaviour from the data.

The extreme discount offered on home deals can easily be interpreted as a craving for liquidity.

9 & 10 Unique Selling Point

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Opendoor answers the second problem of being expensive by positioning their net discount at a very reasonable 6% when taking into account traditional costs.

Compared to the 35% discount introduced before, 15% looks like a great deal. Adding to a simplified process with one counterpart only, the value proposition is re-asserted strongly.

Using blank slides with a single, strong message for your USPs is an efficient way to pace your deck and emphasise the message.

11 & 12. Business Model & Strategy

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As a young company, most of your financials are projected and cannot be determined with great accuracy.

Presenting your costs in a waterfall chart like Opendoor did here is a smart and simple way to address your cost structure without going into too many details (that you probably haven’t figured out yet).

It also constitutes the basis of a budget, by allocating %ages of your revenues to each department/cost centre.

We know from a previous slide that the average US real estate residential deal is around $260,000 and that there are 5 million deals a year. If Opendoor can extract a profit margin of 4.7% per deal, the opportunity looks amazing.

Moreover, they present a way to increase this margin to over 8%.

Both slides are strong commitments in terms of budgeting (allocation of costs) and strategy (how to grow the margin in the long run) and reinforce the professionalism of the team and the potential of the opportunity.

13–17. Risks

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As stated before, real estate is a professional’s industry associate with important financial risk factors.

The 5 slides above get pretty technical in addressing what Opendoor considers to be their 3 major risks.

Even being uninitiated in the industry, these slides are coherently and efficiently laid out. They present in no uncertain terms how Opendoor will mitigate the risks and their potential consequences.

Following the same design pattern since the beginning, the deck outlines three elements in an intro slide that it later explains in details.

These slides project a deep knowledge and understanding of the market. The last one also shows the strategic thinking behind and objective targets that have set for the financing of the company.

Adding that Opendoor already has 3 term sheets at their target terms adds a feeling of urgency, of FOMO and TINA.

18. Series A financing

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Now that all aspects of the business model and the organisation have been covered, the deck gets to the thick of it: the investment proposal.

By linking key objectives to milestones, Opendoor founders make strong commitments towards the investors.

The details of the deal and the valuation will be discussed at length at another time (post due diligence), so sticking to the target amount is enough.

19 & 20. The plan & Impact

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The last two slides outline the strategic development plan for the coming 4 years in three successive phases.

Each phase is described in terms of initiatives and goals.

Outlining a multi-year plan is a requirement of any pitch deck. Most investors know, however, that “no plan survives contact with the enemy”, the enemy here being the market.

Keeping it principle-based and focused around initiatives and goals is an elegant way to talk about the future without making outlandish claims and undeliverable promises.

Ending on a social impact slide is a good way to show prospective investors that, should Opendoor succeed, their money will have made more than a cosy return: it will have changed the world.

Conclusion

While you should, of course, adapt any inspirational deck to your company’s circumstances and story, Opendoor’s deck constitute a brilliant and masterful example of pitch deck well built.

Its coherent design follows clear patterns. Its concise and well-written content displays professionalism, knowledge, and exudes ability.

At an early stage, before breakeven, a company only has a story to sell. While it may have a great idea, we all know that what matters is execution.

Being able to tell a story as well as Opendoor did reassures investors that the team is capable of executing the outlines plan and efficiently using their resources.

We should all emulate Opendoor in our pitch decks!

Pitch Decks

All about pitch decks and financial documentation

Nicolas Carteron

Written by

Entrepreneur, CFO, advisor. I write about fundraising, startup finance, and business strategy here and in my newsletter: fundraisedd.substack.com

Pitch Decks

All about pitch decks and financial documentation

Nicolas Carteron

Written by

Entrepreneur, CFO, advisor. I write about fundraising, startup finance, and business strategy here and in my newsletter: fundraisedd.substack.com

Pitch Decks

All about pitch decks and financial documentation

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