Investors will spend 24% less time looking at pitch floors in 2022 than in 2021, and you have less than three minutes on average to convince them to book a meeting with you. In fact, for those Failed. Investors leave in 2 minutes and 13 seconds to raise funds. That’s not a lot of time to make a first impression, so you have to make it count.
It’s rare that I get to talk to someone who is as big a pitch deck nerd as I am, but when I finally got around to being a research lead at Docsend, how could I not? We’ll dive into what the data tells us about what makes a successful pitch deck, and the indicators of what works well.
The biggest changing trend in how investors view the plasma floor is that investors spend more time on slides in general, but where Time is changing.
“We know that investors are spending less and less time on the pitch deck this year. That’s not necessarily surprising: the number of pitch decks shipped is up, and the time spent on ships is very low,” said Justin Izzo, head of research at Docksend. We know that model classes are what investors like to support, especially for early-stage companies. But investors have halved the time they spend on these classes at the pre-seed stage. Investors are still researching these classes, but they’re doing it faster than ever. So founders need to be more in-depth about their business. They should think, but communicate briefly.
One of the biggest shifts is that investors are spending a lot more time on what DocSend describes as the objective of the launch slide — the “why you’re doing this” part of the story.
“Founders need to think deeply about their business, but they need to communicate it succinctly,” laughs Izzo, “I like to call it the ‘compelling brief.’ It’s not easy to do, mind you, but it’s what founders should strive for.
The third longest visible section is the company’s purpose section (after the product and business model sections), but Izzo points out that this section is usually just a very small slide deck section, usually one or two slides up the deck.
“Usually it’s a one-sentence, abstract, balanced statement that describes what the company is. We usually see it at the front of the ship, usually on the entrance slide. “When I started looking at our latest database, what was shocking to me was that there was a drop in viewing time over the last two years,” Izzo says. “This year, it really took off, and investors can use this segment as a kind of gatekeeper. You want to know at a glance if this company has a reason to exist before going through the rest of the deck.
This is very reasonable; A business purpose statement is often phrased like “Venmo for fundraising” or “Human-centered AI for customer experiences” or “Issue tracking SaaS for physical product developers.” Incidentally, those are all real examples from our Pitch Deck Teardown series. The great thing is that investors can use those statements to see if the investment fits their investment thesis. If you don’t invest in SaaS, or don’t care about fintech, or can’t give a damn about customer support – this will be a very quick filter to say “no” to a startup team without needing anything. Go deeper on product, group or market size.
“It’s about founders being able to communicate a vision and a unique character but also what their company does in a compelling way. Because if you can do that, you know, you’re hooking investors, you’re showing them that this thesis is a good fit, and that primes investors to, you know, prime them to read the rest of their story,” Izzo says. “And you know, it’s hard to do that in a sentence, a sentence and a half or something like that. But we’re seeing it as very important for early stage founders.”
Slides on successful and unsuccessful ships
The DocSend team analyzed 320 decks and looked at which slides were in each. The only drifter in 100% decks, both successful and unsuccessful, was Team, but from there things start to fluctuate a bit.
The most interesting difference between successful and unsuccessful tiles is the missing slides; I was surprised that a quarter of the startup fleets had financials (trust me on this, you really need an operating plan), but I wasn’t surprised that none of the falling classes had financials.
Another big difference is the competition slides; All decks should have a comprehensive view that covers the competitive landscape.
“The first thing to go off is usually the competitive slide. Founders often don’t think to include it, or when they do, they use it as an indication that there’s no competition,” laughs Izzo. “I always tell them to include some kind of analysis of other players on the field, but you define that field.”
The Docsend team created a Fundraising Playbook and Fundraising Report to inform you how to view the fundraising process by comparing the shift from 2021 to 2022.