As YC’s Series A Program Manager, my job is to lend a hand YC founders elevate their Series As. After spending lots of of hours working 1:1 with founders to workshop their pitches and decks, I’ve found myself giving the an identical strategies incessantly. I’ve decided to compile that strategies staunch into a single put up and draw it available to any founder trying to construct collectively a good Series A pitch and deck. Each share of strategies given right here is one factor we’ve educated one in all our founders internally.
What’s the motive of a Series A pitch?
The motive of a Series A pitch is to veil buyers why they like to aloof make investments in your alternate. It ought to aloof present a simply staunch and concise overview of the alternate you’ve constructed, and then paint a picture of the assign that alternate would maybe maybe properly additionally sprint and why elevating cash will allow you to get there.
Let’s rupture this down:
- "Why they like to aloof make investments" - That is an investor pitch, now not a buyer pitch. Traders would maybe maybe properly additionally simply now not have encountered the anguish you’re fixing, and gained’t intuitively ticket how your product solves it. That’s why lawful pitches keep Three key issues: they repeat the anguish your potentialities face and the have an effect on it has on them, they veil how your product solves this want and makes your buyer’s life higher, and they current why doing so is a lawful alternate.
- “Sure and concise” - Mediate investor consideration as a restricted useful useful resource that that you simply simply should exhaust appropriately. Making your pitch as simple and straight ahead as that it's doubtless you may maybe properly inform of minimizes the time required to grab your alternate. Traders ought to aloof be in a spot to envision up on at each hump and straight ticket the extent that's being made. The best pitchers expend simple English and keep away from jargon as unparalleled as that it's doubtless you may maybe properly inform of. The assign jargon is essential, they account for at any time when length clearly the primary time they expend it (and modulate this in accordance to how unparalleled area experience their goal market has.)
- “Overview”: Your objective is now to now not achieve the complete lot about your alternate, nonetheless to tantalize buyers with ample data to protect them concerned. Leave room for questions. A profitable pitch lays the groundwork for a subsequent productive, in-depth dialog. Pitches ought to aloof be 15-20 minutes, with the objective of environment the stage for the subsequent 40-45 minute dialogue. On that veil, if buyers aren’t asking questions or participating in any respect, that’s a crimson flag — it doubtless blueprint your slides are too difficult for them to grab ample to even be keen about what you’re asserting.
- “Of the alternate you’ve constructed”: Delivery up by speaking about what you’ve already constructed. In distinction to your seed spherical, it’s tougher to settle an A primarily primarily based purely on promise. Traders will favor to grab what it is a long way a ought to to veil for the time and cash you already had.
- “Paint a picture of the assign it’s going”: Getting buyers to focal degree in your imaginative and prescient begins by displaying how your ticket fact is trending in course of it. Whilst you’ve established that you simply simply’ve already constructed one factor spectacular, then you definately definately have the credibility that you simply simply should veil how it will maybe maybe properly additionally develop staunch into an unlimited firm. Enterprise capitalists try to get hold of outsize returns, so that they've to focal degree in your group can get there.
- “Why elevating cash will allow you to get there”: The deck ought to aloof draw optimistic that the impediment to your negate is de facto cash (now not incompetence, dreadful product high quality, a lack of product-market match, and many others.). The deck ought to aloof cease by making this express and displaying the blueprint you plan to make investments that cash to get you to the subsequent stage.
- Delivery up by writing out your memoir as a record of bullet elements. The extra concise, the better - objective for 10-15 bullet elements max. In YC, we title this your “fundraising vertebrae”. YC founders ought to aloof be aware of this route of from Demo Day preparations.
- Under each bullet degree, record the information elements you may have as proof that your argument is magnificent. As an illustration, if the extent is that you simply simply produce potentialities profitably, your subpoints can be numbers spherical what % of your acquisition is natural vs. paid, what your CAC/LTV or payback per buyer is and many others.
- Assemble your deck spherical this record. Every bullet degree is one hump. The extreme stage degree is the hump’s title, and the information elements comprise the suppose of the hump that lend a hand current your degree is magnificent. Whilst you’re trying to draw larger than one degree per hump, your hump is just too difficult. By extension, your deck ought to aloof differ from 10-15 slides, now not collectively alongside together with your appendix. Stare beneath for a extra detailed rationalization of simple the scheme to construction each hump.
- Write out a record of questions buyers would maybe maybe properly additionally question, specifically metrics, and draw apparent that it's doubtless you may maybe properly decision one and all of them in a simply staunch and credible blueprint. Occupy data to reinforce the assign available. Or now not it's important to current a secure rob of your alternate to be taken severely as a founder.
Deck Present a proof for
Title (1 hump)
Your title hump ought to aloof record your group title or emblem and a one sentence description of what you keep. Someone studying your one-liner ought to aloof straight be in a spot to record what you keep of their head. This suggests it goes to aloof be:
- Concrete: Example - “Reinventing agriculture” vs. “We create and function robotic greenhouses” - “Reinventing” is just too abstract and “agriculture” is so broad that I don’t get any unique data about what you keep.
- Exhaust phrases present ample for a layperson to grab: Example -“Constructing conduct commerce amongst nicotine addicts” vs. “Abet of us quit smoking” - “conduct commerce” would maybe maybe properly be a explicit, important time-frame to psychology PhDs and healthcare executives, nonetheless that which blueprint is on the complete misplaced on the frequent particular person.
- Particular to what YOU keep: Example - “Plant-essentially primarily based dairy” vs. “We draw plant-essentially primarily based cheese” - inside the first case, it’s unclear what you keep spherical plant-essentially primarily based dairy. Terminate you draw or distribute it? What kind of dairy merchandise? Your one-liner ought to aloof draw optimistic what your market is.
At each degree at some stage in your pitch, buyers are going to be evaluating whether or not you're going to additionally very neatly be value their time. Striking this hump early grabs the investor’s consideration and convinces them that your presentation is value listening intently to.
It additionally affords a nonetheless lead in out of your one-liner (“We lend a hand of us quit smoking. Our product is so lawful that in solely the earlier 2 years, we’ve reached 500ok WAU rising at 20% m/m.”) and transitions neatly into your anguish (“The cause of us want this product is that smoking is the primary rationalization for lung most cancers…”).
Narrate (1 hump)
Present a proof for the anguish you’re fixing. How does the sphere in the interim work to your potentialities, and what’s unpleasant with it?
Create apparent that it’s a anguish your explicit product the reality is solves. The anguish hump is a setup for the answer hump, which matches over the blueprint you resolve this anguish. The reply you ticket needs to look love a pure match for the anguish you’re fixing.
- Harmful anguish assertion: “Americans exhaust $400B on psychological well being issues.” There’s no blueprint a diminutive startup can resolve this $400B psychological well being anguish - each startup completely focuses on a share of it.
- Actual anguish assertion: “x Americans want remedy nonetheless can’t pay for it…” This carves out a explicit allotment of the anguish you’re centered on - lack of get entry to to remedy. This units up your answer hump to focal degree on the blueprint you’re making remedy extra low cost.
Recent the anguish out of your buyer’s degree of view. Your buyer is whoever is paying you to your product. This distinction is specifically needed if the folks that expend your product are completely completely different from the folks paying you to your product. As an illustration:
- Healthcare - you’re on the complete paid by insurers regardless of the incontrovertible fact that your prospects are victims
- Employee advantages - you’re on the complete paid by employers (particularly, HR departments) regardless of the incontrovertible fact that your prospects are employees
Whilst you’re a market, it is a long way a ought to to pick out one degree of view to discuss relating to the anguish from. It on the complete is ideal to discuss relating to the side of the market you’ve prioritized fixing for. As an illustration, when you’re pitching Airbnb, is the anguish that landlords favor to get hold of quick-time body renters, or that it’s piquant for quick-time body renters to get hold of a dwelling to cease?
Train how the sphere in the interim works. Blueprint to veil, now not expose. Some issues buyers are aware of; for others, that you simply simply should veil them that the anguish the reality is exists. The most sharp approach to keep that is to expose the story of what in the interim occurs in a concrete and explicit blueprint.
- Harmful anguish assertion: “Scientific billing is damaged.” That is imprecise. If I disagree with this assertion, there are now not any data elements or examples to veil me why I’m unpleasant. Even supposing I imagine this assertion, I might maybe maybe properly additionally simply now not focal degree on medical billing is damaged for the an identical causes you keep.
- Actual anguish assertion: “Here’s how medical billing works these days: victims favor to keep X very inconvenient steps, which takes Y months of lengthen in compensation and leads to merely Z% of claims being present…”
Resolution (1 hump)
Now that you simply simply’ve described how the sphere works, repeat what you keep and the blueprint it modifications the blueprint the sphere works. What keep you keep to repair the anguish you merely outlined?
Terminate a facet by side comparability. Your anguish hump fully units you up for this. It’s one in all the clearest methods we’ve found to current exactly the blueprint you commerce your buyer’s journey in a concrete blueprint, and due to this fact, what price you present to her.
Quantify your have an effect on with numbers. This goes abet to displaying, now not telling. Don’t expose me you may have the quickest / best possible / most cost-efficient product accessible in the marketplace, the reality is veil me numbers spherical the payment, ease of hint of your product vs. the station quo.
Here’s an instance of those 2 elements in motion:
- Narrate hump: “When corporations favor to envision the identification of completely completely different corporations, they'd to manually check up on up corporations in X databases. This route of took Y days and Z% of those outcomes have been improper.”
- Resolution hump: “With us, all corporations ought to keep is submit a quiz to completely 1 database - ours. This route of takes A days and is B% staunch. This suggests they're going to check C% extra of us D instances quicker.”
Focal degree on what you keep with out lengthen, now not what you plan to keep in some unspecified time sooner or later. Too often I’ve listened to pitches the assign founders paint a imaginative and prescient of an improbable-sounding product, completely to be disenchanted after I dart at it and notice they’ve completely the reality is constructed the very first share. This comes all of the blueprint by to buyers love you’re compensating for now not the reality is having completed unparalleled - and buyers will low cost these hand-wavy hypotheticals to zero since you haven’t the reality is carried out it.
Don’t simply expose me what your product can keep, expose me how your buyer the reality is makes use of it and why that’s treasured to them. On this vein, displaying screenshots of the product or prolonged lists of features is often apt. Train merely ample of what the product does to veil the way it solves your buyer’s anguish and modifications their journey. As an illustration:
- “We have a database of 100ok entries” → “Our database permits potentialities to envision someone’s identification with X% accuracy in Y minutes.”
- “Here’s a screenshot of what our recruiting CRM seems to be love” → “Our recruiting CRM permits potentialities to tabulate and doc what their hiring funnel seems to be love at each stage of the route of in genuine-time, permitting them to with out lengthen flag issues.”
Traction (in-depth, about a slides)
Your numbers ought to aloof expose a story. The story ought to aloof begin with the most important metric to buyers. Whilst you may have revenue, this ought to aloof be revenue. Whilst you occur to ticket revenue, draw apparent that you simply simply repeat the blueprint you raze that revenue - i.e. your alternate model. This helps buyers ticket what drives your revenue, and due to this fact how your revenue would maybe maybe properly commerce in accordance to various elements.
The specifics of what numbers to doc rely in your alternate, nonetheless come what would possibly properly the motive of all of those numbers are to persuade the investor of an argument. (That's the explanation our beginning train above begins by deciding what arguments that you simply simply should draw in your pitch, and then gathering the information elements that veil these arguments are staunch.) Here’s a present memoir in traction sections particularly tailor-made to endeavor and consumer firms:
- We have revenue that’s rising the reality is fast (revenue plus negate payment), in accordance to a secure alternate model (key revenue drivers, margins and the blueprint these margins are monitoring over time)
- We’re incredible at buying potentialities (buyer acquisition) and are in a spot to keep this profitably (unit economics)
- For endeavor gross sales, key numbers would maybe maybe properly additionally embody: gross sales cycle, frequent contract price, salesperson effectivity, and many others.
- For consumer, key numbers would maybe maybe properly additionally embody: breakdown of natural vs. paid acquisition, CAC/LTV, distribution channels, conversion charges and many others.
- They love our product (engagement and retention)
- For endeavor gross sales, key numbers would maybe maybe properly additionally embody: time to onboard, % adoption inside group, churn and many others.
- For consumer, key numbers would maybe maybe properly additionally embody: DAU/WAU/MAU, retention after at some point/week/month, frequent length of time spent on platform, frequent exhaust and many others.
For hardtech and biotech firms, this allotment would maybe maybe properly focal degree on numbers displaying the efficacy of the experience you’ve developed, what number of patents you’ve filed, what number of partnerships or LOIs you’ve signed and what the price and phrases of those commitments are, or a explicit milestone you’ve hit (as an illustration, submitting your 510(ok) or IND utility).
Train tendencies. What’s extra needed than the assign your traction is at this degree in time is the assign it’s going. Your latest scale points in that that you simply simply should hit a apparent scale for buyers to perception that negate: you're going to begin out rising 25% m/m off a horrible of $200ok, nonetheless it for sure’s sustaining that negate when you hit $1m that’s spectacular. Extra needed, nonetheless, is how these numbers are altering over time. That's the explanation a month-to-month or quarterly graph is best than a summed up annual quantity. You additionally favor to veil now not now not up to 4-6 months of this developing for it to be believable (look our article on The Importance of Developments).
This might be why the length of time it took you to obtain these milestones is a really important context: it displays the payment at which you flow into. That’s why we expose firms that the longer they’ve been spherical, the extra they've to have carried out. The benchmarks we compiled in our Series A data are in accordance to the normal timeline of elevating your Series A 18-24 months after your seed, nonetheless when you’ve been spherical for longer, you’ll favor to ought to have extra to veil for it.
Recent numbers clearly and concisely. Founders on the complete drop into Three traps:
- Throwing reams of numbers at buyers: data overload makes it piquant to digest any data in any respect. Your job is to data buyers to the most important substances of your alternate. A lawful scheme to keep that is to set up what your “hero information” are. These are headline numbers that current a key degree that you simply simply should ought to draw. They favor to aloof stick in investor’s minds after the pitch, and be what they expend when pitching you to their companions.
- Too few numbers: on the Series A, that you simply simply should have data to veil you’ve made lawful on the ensures you made on the seed. At best, now not being detailed ample alongside together with your data wastes treasured time making the investor dig for it; at worst, it feels love you’re hiding your numbers since you inform they’re dilapidated.
- Unclear numbers: making your numbers piquant to grab, on the complete as a consequence of each calculating or presenting them confusingly.
- Calculating numbers confusingly diminishes your credibility. It suggests you each don’t ticket simple the scheme to calculate the quantity appropriately (i.e. incompetence) or are now not being forthright about what these numbers the reality is indicate (i.e. dishonesty). A commonplace instance of that is displaying cumulative numbers. Practically each time I’ve thought-about cumulative numbers in a Series A deck, it’s as a result of founders try to shroud their month-to-month/quarterly numbers as a result of they don’t inform they’re secure ample.
- Presenting them confusingly limits investor determining of your alternate. At best, it takes awhile for the investor to grok what’s happening; at worst, they zone out and by no means the reality is get to grab what your numbers indicate. A commonplace instance of that is the utilization of double axis graphs - time is consistently wasted in clarifying which line goes with which axis, and then determining what these traces indicate.
- Here are about a lawful suggestions of thumb to lead away from falling into these traps.
- Graphs ought to aloof be comprehensible at the beginning check up on. If it requires a deeper rationalization to grab, it’s too superior.
- Be very optimistic about exactly what your numbers are measuring. Whilst you occur to declare prospects, are you speaking about month-to-month actives or day-to-day actives? Whilst you occur to declare revenue, are you speaking about unpleasant or accumulate?
Market (1 hump)
Train how incredible of a possibility you’re tackling. We on the complete indicate a bottoms-up calculation. A present formulation for that is:
form of functionality potentialities x price of each buyer to you
A bottoms-up calculation ought to aloof depend on real numbers gleaned out of your latest alternate - the form of functionality potentialities is in accordance to the patron segments you in the interim serve, and the price of each buyer ought to aloof be in accordance to their legitimate price to you with out lengthen. High down numbers from reviews are often now not explicit ample to the market your product performs in, specifically when you’re tackling a subset of the market, or when you’re developing an completely unique section. Whilst you’re developing a class, it’s additionally apt to veil a pair lawful analogies of huge firms which have carried out an an identical issues that it's doubtless you may maybe properly pattern match towards.
Rivals (1 hump)
Train why you’re 10x higher than all and sundry else trying to keep what you’re trying to keep. The foremost right here is to persuade the investor that you simply simply have a extreme ample moat to draw your alternate defensible towards rivals.
Imaginative and prescient (1 hump)
Train the blueprint you alter into a $10B firm. That is a thought train we feeble to ma