What Makes a Series A Raise Unique
The story you’re telling in your Series A raise is going to be significantly different from the one you told at Seed. It’s not as simple as inserting a few traction slides and adding your new VP of Sales to the team slide.
The first thing we recommend is an honest assessment of where you stand as a company. What have you proven—or not proven—since raising your seed round? What evidence are you seeing of product-market fit? How confident are you in your go-to-market? How have you de-risked your technology and your business model since your last raise. And how will an additional round of investment accelerate your growth? Confronting these questions before working on your pitch will put you in the right mindset for the round you’re about to raise.
At Series A, your company is at a unique point in its development. Investors are looking for concrete signs of progress, but they’re also looking for a vision that carries your company from product-market fit to massive scale. Balancing these two things—vision and execution—is critical to an effective Series A pitch deck.
How to Get Started on Your Pitch
Before you fire up Keynote, we recommend eating the frog by kicking off your process with the toughest questions you’ll have to answer. Put yourself in the shoes of your prospective investors and list out all of the questions you would expect them to have about your business before you walk into the room.
Some of these questions will be generic, i.e. “What is your CAC/LTV ratio?”. But others will be specific to your market or your company, i.e. “Didn’t [COMPANY X] fail when they tried to do the same thing?”.
Developing clear, concise answers to these questions will give you the building blocks for building your pitch. Some of these answers will become slides, others will end up in the appendix, and some you’ll keep in your back pocket for when questions arise. But make sure that you’re covering all of your bases before your start thinking about story and narrative.
Capturing an Investor’s Attention
You’ve heard it 1000 times: open your pitch with a clear description of “The Problem” your customers are facing and “The Solution” you’re bringing to market. There’s nothing inherently wrong with this approach, but we believe there’s a more interesting way to engage with investors and demonstrate, right off the bat, that you have something unique to offer.
At the beginning of your pitch, investors are likely asking themselves two questions: Why is this company different? And why this the person to lead it? So we think it’s critical to answer these two questions as quickly as possible.
Don’t be the 4th person today to tell them how many mobile devices there are on the planet. Lead with something new and thought-provoking.
Start by sharing an interesting but believable fact about your market that you expect most investors won’t already know. You don’t want to be the 4th person today to tell them how many mobile devices there are on the planet; instead, be the person who tells them how many mobile devices are used on construction job sites.
Then, follow up with “the core insight” upon which your company is built. This insight should be some combination of surprising and counterintuitive. And there’s a simple phrase that helps you bridge from your core truth to your core insight: “But here’s the thing…”
For example, after you’ve talked about the prevalence of mobile devices on construction job sites, you can follow up, “But here’s the thing… internet connections are spotty at best on these sites, so apps that rely on consistent bandwidth are quickly abandoned.”
And this is where you open the door to your solution. And, again, there’s a simple phrase to get you there: “So if you could…”
For example, once you’ve established your core insight into why mobile apps aren’t adopted on construction sites, you can paint a picture of the possibility ahead by saying, “So if you could figure out a way to serve apps in this environment, you could enable the transformation of a $1T industry.”
This is a pretty flexible formula, but we find that it really helps to crystallize what’s unique about your business in a clear, efficient way at the beginning of your pitch.
Rehearsal & Feedback
There are two really important things to consider when you ask for feedback on your pitch: who you’re asking and how you’re asking.
There’s nothing wrong with seeking feedback from members of your team or from other entrepreneurs. But it’s important to remember that both of these audiences have very different perspectives from your potential investors. They can help you communicate ideas more clearly or cut unnecessary detail out of your pitch, but you may not want to rely on them for advice on whether your pitch will attract investment.
For that, you want to go directly to the source. Of course, it’s unrealistic that you’ll be able to practice with one of your prospective investors. But you can find “proxies” for these investors. These might be existing seed investors who also invest in Series A, or investors with expertise in your space but don’t invest at your stage. In either case, the feedback you get from this group should be weighted most heavily.
And if you are lucky enough to practice in front of an investor, don’t waste the opportunity. Be prepared to pitch the deck, not just walk someone through the slides. Investors, like most of us, have a hard time separating the message you’re delivering from how you’re delivering it, and so if you don’t seem familiar with your pitch—or confident in your delivery—you’re likely to get more negative feedback.
It’s also important to make sure you’re asking the right question after the pitch. Too many times, we’ve seen founders finish a practice pitch and then ask, “What do you think of the pitch?” This is an open-ended question that invites feedback like, “I would swap Slide 3 with Slide 4” or, worse yet, “I just didn’t get excited.” And there’s not much you can do with this feedback.
Instead, ask a much more valuable question, i.e. “So, would you invest?” This question completely changes the dynamic of the conversation. And you should only accept three answers: “Yes, because... ” “No, because…,” and “Yes, but only if... ”. This feedback is likely to be much clearer and more actionable because it asks your audience to think about how they would act based on your pitch, not just how it makes them feel. And we can promise that nobody will ever answer, “Yes, but only if you swap Slide 3 with Slide 4.”
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