The Pitch Deck We Used To Raise $500,000 For Our Startup

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The Pitch Deck We Used To Raise $500,000 For Our Startup

 

buffer-seed-round-deck.003One of the big no-no’s we’ve learnt about early on in Silicon Valley is to publicly share the pitchdeck you’ve used to raise money. At least, not before you’ve been acquired or failed or in any other way been removed from stage. That’s a real shame, we thought. Sharing the actual slidedeck we used (and one, that’s not 10 years old) is by far one of the most useful things for others to learn from. In fact, both Joel and I have privately shared the deck with fledging founders to help them with their fundraising. On top of that, our case study is hopefully uniquely insightful for lots of people. Here is why:

  • Half a million is not a crazy amount: It’s therefore hopefully an example that helps the widest range of founders trying to raise money.
  • Both Joel and myself are first-timers: We couldn’t just throw big names onto a slideshow and ride with it. We had to test and change the flow and deck a lot.

Ratio thinking

One of the most important elements, that we had to learn during our fundraising process was the concept of “Ratio thinking”. Jim Rohn, the famous motivational speaker, probably explained it best:
“If you do something often enough, you’ll get a ratio of results. Anyone can create this ratio.”
It sounded simple enough as a concept to us, but man, this was one of the toughest things to learn. Here is how Joel described it in a recent article on ratio thinking:
“The law of averages really comes into play with raising investment. Overall, we probably attempted to get in contact with somewhere around 200 investors. Of those, we perhaps had meetings with about 50. In the end, we closed a $450k seed round from 18 investors. Perhaps the most important part of our success in closing that round was that Leo and I would sit down in coffee shops together and encourage each other to keep pushing forward, to send that next email asking for an intro or a meeting. In many ways, the law of averages is the perfect argument that persistence is a crucial trait of a founder.”
I believe that this is in fact one of the most valuable things to know up front. It requires a huge volume of work and meetings.

How to read this deck: It builds up to one key slide – Traction

If you go through the deck, you will quickly realize that the one key slide was the traction slide. We quickly realized that as first time founders, this was probably our only way to raise any money: By focusing everything on the traction slide. Here is how Joel describes this in his article on raising money as a first-time founder:
“So my advice for first time founders who want to raise funding is almost always to put that thought aside until you have good traction. Instead, focus completely on traction. Focus on product/market fit. When you have good traction, it becomes much easier to raise funding.”
 

Avoid confusion: Our second most important slide – competition

Another thing we quickly realized when raising money was this. Although investors were very interested in talking to us, especially because of our early traction, talks then stalled. Why? The social media space seems very crowded. From the outside, it looks like there are dozens and dozens of apps all doing the same thing. On the inside, you however quickly realize that there really aren’t that many options.

The question was almost always timed at the exact moment in each meeting: “So, aren’t there lots of other apps doing the same?” And we explained to them about the TweetDecks and Seesmics and that Buffer is different and so forth. That never worked. So after lots of meetings, we realized that the competition question (in our case) created the most friction and eventually left people too confused and not interested any more. We took some time aside and made this slide as easy to understand as possible and explain Buffers positioning without creating all the friction: buffer-seed-round-deck.011 

The slidedeck

Without any further explanation, here it is:

A note on transparency

With Buffer, our goal is to take our ideas of transparency for our company to a whole new level. That’s why it was very important for us to make this slide deck public. This slide deck is far from perfect. As previously mentioned, it probably falls into the average category. But it was what at the end of the day helped us raise the funds to turn Buffer into the company it is today. So it’s hopefully a real-world case study that clearly shows what is important and what might not be so helpful for investors to know about. We want to continue publishing our ideas and thoughts about topics that get rarely talked about. Joel and I will be around to answer any further questions you might have on our fundraising process. Please post anything you have in mind in the comments below.

This is a guest post by Leo Widrich (@leowid), co-founder of Buffer.  Note: I'm an angel investor in Buffer and my company HubSpot has a little bit of overlap in functionality in our Social Inbox product.


Posted by Dharmesh Shah on Wed, May 08, 2013

COMMENTS

Brilliant, thanks for sharing. 
 
Did the competitive landscape slide do enough to explain how Buffer is different?  
 
Congrats on securing the investment!

posted on Wednesday, May 22, 2013 at 4:03 AM by Julian


Very helpful, thank you! And congrats on your success. 
 
Why is it important to keep the deck secret? Mine does contains only information that's already available elsewhere. This has always confused me.

posted on Wednesday, May 22, 2013 at 9:18 AM by Topher


I love transperency! Thanks for sharing, I will download buffer asap this is the way to get ppl to advertise by sharing great infonand help and encouragement

posted on Friday, May 24, 2013 at 5:21 PM by Cole


Nice post! Thank you for sharing this useful and informative article. I learned so much from your post. I hope to read more of your blogs, please do keep us posted. Again, thanks and keep up the good work!

posted on Tuesday, May 28, 2013 at 10:54 PM by Vira Lisa


I'm working with start-up companies - the openness you demonstrate by sharing this masks a courage and vision that should be celebrated. I will be sharing with all our mentors/start-ups with the perspective that an entrepreneur has less to fear from openness than she/he does from a lack of completeness of vision. It really doesn't matter what's in your deck unless you have the latter - and it need not be in the deck at all in order to attract an investor. I'm guessing the funding came through as an outcome not of the deck per se but of the questions it provoked from the investors?

posted on Saturday, June 01, 2013 at 6:21 AM by Chinenye


Thanks for sharing Dharmesh. Your posts are genuinely written to help people and from personal experience rather than a lot of the general (can find a million articles like that using google) dribble you can find on the internet.  
I learnt from a PR guru yesterday that the best PR is to help people and the goodwill, will give you many fold returns. I can see that you are well on your way implementing that thought.  

posted on Thursday, June 06, 2013 at 5:36 AM by Amit Sanghvi


in the game called CRICKET, a cover drive is one of the best shots played in the game... this post has the potential for exponential growth and I support the cause 100%..good luck guys, and as you do your thing , this hSIMPLE AND EASY..http://www.sfi4.com/12753859/FREE 
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posted on Tuesday, June 18, 2013 at 10:02 PM by john


Thanks for your transparency and for sharing your success and experiences Dharmesh. Keep it up!

posted on Sunday, June 30, 2013 at 11:14 PM by Daniel Law


I hope you can give your followers. Everytime I read your blog I'm so pleased with it. I don't know that there are still good in web designing.

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