Mike Lingle at Rocket Pro Forma
The Startup Pitch Deck Playbook
Updated: Sep 3, 2021
We Finally Did It!
In 2009 we raised $2 million in venture capital for SlideRocket. We had been building the business for over a year and had been talking to potential investors for almost as long. I got to meet amazing people like Fred Wilson and Tim Draper along the way—most of whom said no.
What makes some investors say yes?
I’ve learned to focus on 8 different areas to grab people’s attention. Today, I’m going to share some of the most effective ones with you using examples from actual pitch decks.
The Eight Key Drivers for Your Investor Pitch
Check out my free topics and templates for your investor pitch deck, as well as the Rocket Pro Forma financial projections template, at RocketProForma.com/resources.
Here's a quick video walkthrough of what makes a great startup pitch deck:
People read about venture capital and to think it will be easy—but many startups find out that it’s not. Raising money takes a smart strategy and a ton of effort. Here was Buffer’s experience:
“The law of averages really comes into play with raising investment. Overall, we probably attempted to get in contact with somewhere around 200 investors. Of those, we perhaps had meetings with about 50. In the end, we closed a $450k seed round from 18 investors. Perhaps the most important part of our success in closing that round was that Leo and I would sit down in coffee shops together and encourage each other to keep pushing forward, to send that next email asking for an intro or a meeting. In many ways, the law of averages is the perfect argument that persistence is a crucial trait of a founder.”
Can I guarantee that you’ll be able to raise money? Probably not.
But can you increase your chances significantly? Absolutely.
The Main Takeaway
The most effective strategy is to take your pitch out of the realm of “I think” and into the realm of “I know.” Two magical things happen once you do this:
You’ll be able to raise money
You may not need to raise money.
I’ve compiled all 8 areas into an easy-to-reference training guide with specific examples that you can download and follow as you develop your own pitch deck.
What Are Investors Looking For?
Peter Livingston is a professional angel investor based in Miami who looks at 60 to 80 pitch decks per month. That’s close to 1,000 every year. He’ll invest in maybe 20 startups this year, which is around 2%. You have to be the best of the best to get his attention.
How do you make sure that you stand out in the crowd?
First of all, here’s what not to do. At least half of the decks I see basically say, “Give me your money and I’ll figure it out.” Yuck.
This may work if you’re raising money from friends, family, and fools who believe in you (thank you, Mark Volchek, for that term). If you’re talking to a professional investor like Peter, however, you’ll need to put the “plan” in “business plan.”
Investors often look for traction, team, and who else is investing before they even consider the what you're working on. Your idea, and the specifics of your product or service, are actually the least important part of your pitch deck. There are millions of good ideas out there, but only a few people who can actually make them work.
Here's a walkthrough of the main things investors want to see in your startup pitch deck, along with actual examples of slides,
This is where the rubber meets the road. Investors hear a ton of people claiming to know what will happen (“I think”), so you stand out by proving that you’re already making it happen (“I know and here’s the data”).
Traction is a measure of how close you are to reality—i.e. making money.
Leo Widrich, one of the founders of Buffer, says it best: “We quickly realized that as first time founders, this was probably our only way to raise any money: by focusing everything on the traction slide.”
Here’s an example of a traction slide that sucks. The total number of signups is the kind of “vanity metric” that Eric Ries talks about in The Lean Startup, because the chart will only ever go up and to the right. You will keep getting signups, so it doesn’t mean anything. You will go out of business getting signups if no one sticks around to use your product.
The only thing that matters is how many people come back and use your product or service repeatedly.
Now look at this great slide from Buffer. They are showing a 1.5% conversion rate from free to paid (800 paying users out of 55,000 total users) so you can see that this is a real business that’s growing. You can also see that they have a handle on their finances because they know their run rate and margins. This is what makes people want to invest!
Here’s another example from a company called Blinq that’s seeing 60% daily active users out of their total installed base, and people are using the app 5 times per day. So that tells us the usage, which is what’s actually important.