Seven Fundraising Deck Mistakes and One Trick to Unlock Your Next Round
When Narrative Trumps Numbers
Based on inbound requests, I’m taking a short break from the “How great leaders create value outside of their function” series and expanding on the fundraising theme from the prior post.
To recap how we got here:
Startups get funded based on the strength of the forward-looking narrative.
Current financials don’t accurately represent the future of the company.
The detailed metrics, models, and cohorts aren’t there to convince someone to invest, they’re there to make sure they don’t decide not to invest.
Great CFOs identify the “wart” metrics that will show up in your fundraise ahead of time and manage around them (read the previous post to learn how).
So if a fundraise doesn't hinge on the numbers, surely it's all about laying out the company's vision?
Wrong.
Your fundraise pitch is actually about your customers. The problem that you solve. The value it provides. And your ability to monetize it.
What makes crafting your pitch deck uniquely hard:
You have to play devil’s advocate and poke holes in your own story that you’ve so carefully crafted over the years. The startup is your baby. How could anyone ever think that they aren’t the cutest baby in the world?! (As a father to a 6-month old, I ask myself this question all the time.)
The story you tell changes quite dramatically between Series A/B vs. Series C/D — with not just heightened expectations for metrics, but a requirement that every single forward-looking claim you make is supported by current evidence from your customers.
While the pitch is all about your customers, relative to a sales or marketing deck, the pitch deck is much more forward looking and needs to bring in elements from the rest of the business. At the same time, you need to resist the urge to simply brag about what you’ve accomplished — instead, emphasizing how much more you will achieve.
Below I’m going to share the top 7 mistakes I see in pitch decks — that often come down to the challenge of having to reframe your perspective on the company.
Finally, scroll to the bottom for the 1 trick that I keep going back to when iterating on investor decks.
Today’s cover image is Camille Claudel’s sculpture “The Waltz.” Just like the famous dance, your fundraising deck needs to be carefully choreographed and move along at a brisk pace with a maximum of 20-25 slides. For the dancers out there: I’m talking about Viennese Waltz and not the much slower International Standard Waltz used in ballroom dance competitions.
Mistake #1
Opening with the team slide
Why it’s an easy mistake to make: you’ve been told over and over again that VCs invest in the founder and the team as much (if not more so) as the product itself.
What it tells me when I see this: the culture and operating framework (how decisions are made) hasn’t quite matured to the point where it is ready to scale (read this and this to learn more).
My preferred approach: put the team slide at the end but start every investor pitch with a quick 60-second voiceover of what motivated you, as the founder, to start the company. It’s a great way to break the ice and establish an emotional connection.
Mistake #2
Giving a history of the market
Why it’s an easy mistake to make: it probably feels like a great way to answer the ‘why now?’ question and show that the market is primed for disruption.
What it tells me when I see this: the company is a follower, not a leader — they’re trying to catch the wave, not create it.
My preferred approach: instead of framing a history of the specific market you operate in, talk about broad secular then/now trends — ideally something that speaks to what’s driving your customers’ customers.
Mistake #3
Assuming that the disruption opportunity is obvious
Why it’s an easy mistake to make: you are pitching investors who already know the space and the company, so you don’t feel the need to “waste” a slide on this.
What it tells me when I see this: your product-market fit may not be as broad as you think — the risk that hasn’t been pressure-tested is that you’re skimming the top of the market but can’t expand beyond the early adopters.
My preferred approach: put a stake in the ground and make it clear why you believe that, eventually, everyone will have to see the market the way you see it; and how people/companies who don’t see it your way will fail or fall behind.
Mistake #4
Talking about the product instead of the problem
Why it’s an easy mistake to make: you’re a tech company… shouldn’t you talk about your product to explain what VCs are investing in?
What it tells me when I see this: the GTM motion is likely to hit a wall as the company approaches $100M in ARR. Specifically: the company is “selling its org chart” instead of selling a solution to a customer problem. This means that GTM will suffer as the company experiences all the usual growth pains.
My preferred approach: you still need a product overview slide but it should be framed in terms of what it means for the customer and tied to a GTM metric. E.g., if your platform is modular then bridge it NDR; if your product has multiple use-cases quantify the relative value of each.
Mistake #5
Framing things in phases
Why it’s an easy mistake to make: it’s a great way to explain why the future will not be like the past. In other words it is code for “Don’t pay attention to my current sub-par financials…it’s all just a loss-leader for phase three.”
What it tells me when I see this: cash burn, cash burn, cash burn…with some rare exceptions where a multi-phase approach is justified (20-year horizon investments).
My preferred approach: frame things in terms of beachheads and quick follows instead of phases; show an example where a quick follow came through with a specific customer or a handful of customers.
Mistake #6
Putting up a slide with a bunch of KPIs listed on it
Why it’s an easy mistake to make: investors always ask for these and act impressed when they hear about them; you have reasons to be proud.
What it tells me when I see this: someone forgot about the customer, or has spent too much time with i-bankers, or is pitching to PE shops only.
My preferred approach: open your deck with a “why should you care” type slide that tells you what the company is/does. Weave the KPIs into the summary bullets on that slide, then make sure you have customer case studies to support them later in the deck.
Mistake #7
Telling me your vision for the company
Why it’s an easy mistake to make: as a founder you probably think and talk about the vision all the time: with employees, peers, and customers. What better way to establish the forward-looking narrative?
What it tells me when I see this: The company may not be ready to listen to market feedback should that vision need tweaking or require an adjustment to the product roadmap that the founder doesn’t agree with.
My preferred approach: re-frame the vision in terms of the kind of active impact you want to drive for your customers. For example, instead of “Build the best place for mom-and-pop stores to sell online” you can say “Bringing the next 100,000 businesses online to 10x their growth.”
The One Trick
The hardest thing about developing a pitch deck is knowing when to listen to feedback, when to reframe it, and when to stop changing the deck before finally taking it to market.
You’re surrounded by advisors. Everyone you talk to will point out things that didn’t land for them or that they think are missing from the deck.
I keep coming back to this principle: treat each slide as if it’s the only one.
What I mean by that: if all you did was grab a screenshot of that one slide and sent it to an investor, would it tell them a story (vs. just share a fact) that would pique their interest.
Your deck is done when each slide passes the stand-alone story gut check and 1+1 = 3 for the story arc of the deck as a whole.
For example:
Instead of showing a slide with a bunch of F500 logos across industries, tell a story about how/why you’re able to solve the same problem in multiple industries.
When presenting a slide with your projected ARR growth, highlight the product “big rocks” you’re investing in to accelerate it.
If you are laying out the key drivers of your customer value prop, present it as a case study that weaves in the $ amount customers are willing to pay for that value.
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By the way:
I partnered with Operator’s Guild to launch a master class and diagnostic focused on leveraging the CRO/CFO Partnership to drive the entire company forward.
Our inaugural class was 280% over-subscribed.
If you’re not an Operator’s Guild member the course is still available to you and can be adapted for your specific team needs. Grab time below to learn more.
