Looking at 320 pitch decks, here is what science tells us works greatest

Investors are spending 24% much less time taking a look at pitch decks in 2022, in comparison with 2021. On common, you have got just below three minutes to persuade them to take a gathering with you. In truth, for decks that fail to boost funding, buyers quit in simply 2 minutes and 13 seconds. That’s not plenty of time to make a primary impression, so that you’ve obtained to make it depend.

It’s fairly uncommon that I get to speak to somebody who’s as large of a pitch deck nerd as I’m, however after I was lastly in a position to nerd out with the analysis lead at DocSend, how may I not? We go deep into what the information tells us about what makes a pitch deck profitable, and indicators for what works much less effectively.

The largest development change in how buyers are taking a look at pitch decks is that buyers are spending quite a bit much less time on slides total, however the place that point is spent is shifting.

“This year, we know that investors are spending less and less time on pitch decks. That’s not necessarily surprising: The number of links to pitch decks sent out has gone up, and the time spent on decks is staying very low,” explains Justin Izzo, analysis lead for DocSend. “What’s surprising to me is that we know that the product and business model sections of decks are really where investors liked to lean in, especially for companies at the early stages. But investors have almost halved their time spent on these sections at the pre-seed level. Investors are still giving scrutiny to these sections, but they’re doing it so much more quickly than ever before. So founders have to really think deeply about their business, but communicate briefly.”

One of the largest shifts is that buyers spend much more time on what DocSend describes as the aim of a startup slide — the “why are you doing this” a part of the story.

“Founders have to really think deeply about their business, but communicate briefly,” laughs Izzo, “I like to call it ‘compelling brevity.’ It isn’t easy to do, mind you, but it is what founders should be striving for.”

The timeline to fundraising varies. This 12 months, 25% of startups raised in lower than six weeks; 58% raised in lower than 12 weeks; 70% raised in lower than 18 weeks; 90% raised in lower than 24 weeks. Last 12 months, the tempo was a bit of bit slower. Graph Credit: DocSend.

The third-longest-viewed part is the Company Purpose part (after the product and enterprise mannequin sections), however Izzo factors out that this part is normally solely a really small a part of the slide deck, typically only a line or two of textual content on slides one or two of the deck.

“Usually it’s one sentence, a pointed and well-balanced statement of what the company is. We usually see that at the very front of the deck, often on the intro slide. What was shocking to me when I first started looking at our latest dataset, was that over the past couple of years, it’s been kind of middling in terms of viewing times,” says Izzo. “This year, it really shot up, and investors tend to be using this section as a kind of gatekeeper. They want to know at a glance whether this company has a reason to exist before even going through the rest of the deck.”

That makes plenty of sense; a enterprise goal assertion is commonly formulated as “Venmo for Fundraising” or “Transform customer experiences with human-centered AI” or “Issue-tracking SaaS for Physical Product Developers.” Incidentally, these are all actual examples from our Pitch Deck Teardown sequence. The great point is that buyers can use these statements to see if the funding may doubtlessly be an excellent match with their funding thesis. If you don’t put money into SaaS, or should you don’t care about fintech, or should you couldn’t give a crap about buyer assist — that turns into a really fast filter to present a startup staff a “no,” with no need to go deep on product, staff or market measurement.

“It’s whether founders can communicate a vision and specificity but what their company does, in in a compelling way. Because if you can do that, you know, you’re hooking investors, you’re showing that there is this thesis fit, and then that gets investors ready, you know, primed to read the rest of their story,” says Izzo. “And you know, doing this in a sentence, sentence and a half or something like that, is tricky to do. But we’re seeing it becomes so much more important for early-stage founders.”

Slides in profitable versus unsuccessful decks

The DocSend staff analyzed 320 decks and checked out which slides have been current in every. The solely slide that was accessible in 100% of decks, each profitable and unsuccessful, was Team, however from there, issues begin various a bit.

Successful Decks. Graph Credit: DocSend.

The most attention-grabbing distinction between profitable and unsuccessful decks is the slides which can be lacking; I used to be shocked that solely a couple of quarter of startup decks had financials (belief me on this one, you really want an working plan), however I used to be unsurprised that not one of the failed decks had financials.

Slides in unsuccessful decks. Graph Credit: DocSend.

The different large distinction is competitors slides; all decks ought to have an summary masking the aggressive panorama.

“The first thing that’s missing is often a competition slide. Founders often don’t think to include it, or when they do, they are using it as a not-so-subtle indicator that there is no competition,” laughs Izzo. “I always tell them to include some kind of analysis of other players in the field, however you define that field.”

DocSend’s staff created a fundraising playbook of types, and a “state of the union” report for fundraising, evaluating the shifts from 2021 to 2022, which makes for an interesting in-depth learn to tell the way you’re taking a look at your fundraising course of.

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