DocSend partnered up with a HBS professor to do a pitch deck analysis of 200 seed to series-a deals with a raise volume of $360m. Out of this research are a couple of useful heuristics which are useful to guide founders as to what a raise process will feel like. I recommend having a flick through to manage your expectations if you are need to raising cash.
The average successful raise for $1.3m involves:
- Reaching out to 58 investors
- Having 40 meetings
- 12.5 weeks to close
- Pitch decks are 20 pages long
- Investors flick through a deck initially for less than 4 minutes
- The two slides investors spend the most time on are Financials and Team
- The $ value per contact is 5x higher for firms as opposed to Angels and are faster to close
Implications of this data for founders
The pitch deck analysis shows that:
- Decks need to be short and pointed: get all the key data across in just enough slides- don’t send a 50 page essay. It takes a lot of time to write a short deck, but it takes a lot of time to write pointless slides too
- Fundraising takes time: The process is fairly long, we are talking a solid 3 months. Founders need to ensure they can keep the lights on and keep growing in the mean time
- Focus on the best investment prospects: Investors with bigger check books have a better RoI as they yield more cash per time spent. You may get lucky but in all likelihood there are around 5 likely investors for you (Quality over quantity). Your target list is likely around 20. Effort does not lead to results, when effort is misapplied. The best investor prospects are just that
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