How to show growth in a pitch deck for your startup?
Growth is one of the most important metrics in a pitch deck and fundraising campaign. It is one of the most important data points for internal teams and founding entrepreneurs themselves too.
When it comes time to go out pitching startup investors for another round of funding, much of your success, and how efficient the process is may rely heavily on how you demonstrate your growth.
So, what is a good rate of growth to show? What types of growth should be measured and presented in a pitch deck? Which slide does this even go on?
The Ultimate Guide To Pitch Decks
Here is the content that we will cover in this post. Let’s get started.
- 1. Why Growth Is So Important In A Pitch Deck
- 2. Growth For Startups
- 3. Growth For Startup Investors
- 4. Risk
- 5. Returns
- 6. Being A Part Of A Successful Venture
- 7. Proving That The Founders Can Execute
- 8. Proof Of Concept
- 9. How Fast Should My Startup Be Growing?
- 10. How To Show Growth In A Pitch Deck
- 11. Ways To Show Growth In Your Pitch Deck
- 12. Milestones Achieved
- 13. Other Investors
- 14. Product & Product Lines
- 15. Financials
- 16. The Traction Slide
- 17. What Types Of Growth Can You Show In Your Pitch Deck?
- 18. User Count
- 19. Sales Volume
- 20. Revenues
- 21. Headcount
- 22. Market Share
- 23. Geographic Coverage
- 24. Ways To Support Your Growth Forecasts
- 25. Summary
Why Growth Is So Important In A Pitch Deck
Growth is vital for startups. Even more so if you hope to bring in more investors and investment for your startup.
Here are some of the reasons why founders need to be so focused on growth, and why it is such a pivotal factor for their financial backers and partners.
Growth For Startups
Businesses, especially startups, are either growing or dying. There is no just clinging on and maintaining the status quo. So, if your company is not growing, it is only a matter of time before you are out of business. It is just a question of whether it will be fast and sudden, or slow and painful.
This is even more vital for early-stage startups which really can’t hold their own, sustain themselves, and remain a viable and profitable venture with a small amount of revenue or market share.
Measuring and tracking your growth rate will force you to focus on it as the leader. It also ensures that your direct reports, and in turn, your entire team get that this is what they need to be focusing on and working to impact to move the needle on a daily basis.
What you measure, track, and focus on gets improved upon.
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It also shows you your own progress. So, on those tough days, and in those challenging moments, you can cling to this anchor, that you are making things happen, and should keep on going.
Then again, if you need more capital and cash, your growth will be absolutely pivotal to making that a possibility. As well as how much investment you can bring in, from whom, and on what terms.
If you want to impress investors, you’ll have to show that your startup is growing or has the potential for growth. If you need more information on how to get traction for your business, check out this video I have created.
Growth For Startup Investors
There are actually a variety of reasons that growth is so desired and critical for those investing in startups.
This includes the following.
As mentioned above, if a startup isn’t growing, it is going out of business. No one wants to invest in a dying business, just to watch their capital be lost, and their investment devalued. It would make more sense to just go to Vegas and go all in on one spin on the roulette table. At least there is the hope of a positive outcome.
In contrast, a startup that is growing, and has proven to maintain growth, is a far less risky venture. Remember, that the number one rule of investing is not to lose money. Rule number two is to remember rule number one, of not losing money.
So, the better your growth data, the less risky you are for investors, lenders, or other financiers.
Lower risk means the ability to negotiate and demand better terms and more capital. As well as to enjoy a smoother and more streamlined fundraising process. It’s a great way to show growth in a pitch deck.
The returns that investors can reasonably expect are directly correlated to your growth rate.
If you’ve only been growing at 10% per year, you are probably not going to be able to convince investors that they are going to achieve 100% returns in a year. You just don’t have the data to support it.
Remember that early-stage startup investors need huge returns and multiplies on their investment. It is how they invest. It is essential for offsetting the risk involved.
So, the stronger and more predictable your growth, the more attractive the potential returns for investors, and the higher the likelihood that they will invest, invest big, and be willing to tweak the terms and clauses in your favor so that they can participate.
Being A Part Of A Successful Venture
Everyone wants to win. Everyone wants to be a part of something successful.
The boost to the ego, and bragging rights at dinner with other investor friends and family members, and in the investment community can be as important as the direct financial rewards. It is especially important that investors build a strong track record of success, and invest in fast-growing startups that go big.
Showing a rocket ship of growth is something that many will want to pay to jump on and ride.
Proving That The Founders Can Execute
Ideas are cheap and plentiful. In fact, there may be too many aspiring entrepreneurs with nice ideas that really aren’t going to become fantastic businesses.
The difference between a great and profitable business and investment is the ability of the founders to execute and grow the company and value.
Your growth rate is like your credit report and resume. It is proof that you can actually make things happen, and produce returns for investors.
If you can’t execute and drive growth, then this is better as a hobby idea, a charitable initiative, or something you can do as a job for another company.
Proof Of Concept
Growth shows that your concept really works. If you are growing, it suggests your business model, solution, product, problem, and team are working.
Ideally, this is also backed up by financial proof, and proof that this is also a commercially viable, and profitable business. Not just one that can survive by constantly being floated by new capital.
Many new startup attempts are just possibilities. It can take a while to prove that it all works and to iterate to get it to work. As you prove this and grow, you will be able to attract better investors that can provide more value and capital.
How Fast Should My Startup Be Growing?
Startup investors have very specific growth expectations and criteria.
While all are ideally looking for that famous hockey stick-style growth trajectory, they are also looking at the actual numbers and how you are compounding growth over each period of time.
Growth rate expectations will be higher in the early days, months, and years, and will moderate for mature startups that are preparing to go public, or which may be absorbed into a corporate or private equity portfolio.
If you are not growing at 10x to 100x, then you probably just aren’t growing fast enough to justify the attention and capital of true startup investors.
How To Show Growth In A Pitch Deck
One of the key uses for growth data is in your pitch deck for fundraising for your startup. So, how do you integrate it for a successful pitch and campaign?
Where does this data go, and what should be measured and displayed?
Ways To Show Growth In Your Pitch Deck
These are some of the ways to display how you’ve been growing in your pitch deck.
You may bullet point specific milestones that you have already achieved. What specific levels have you hit or surpassed that show your growth? Or at least that you’ve championed certain parts of the business, have removed risk and proven its potential?
Your investors are great indicators and validation for your startup, and in turn, how fast it has probably been growing and will grow.
If you have notable past and current investors that have a strong reputation in the community for investing in fast-growth startups, this will already be a powerful indicator that you have the growth or growth potential these new potential investors want as well.
Product & Product Lines
Your pitch deck product slide may also be a great indicator of how far you have come. It may be a slide where you can work on how much product you have moved. While a growing product line that is truly supported by the fundamentals can also show growth.
Your financial slides will certainly provide the mathematical proof of whether your startup has been growing or not, and by how much.
Be sure your financial slides hone in on the line items and metrics that prove you are growing in the right direction, by how much, and for how long you’ve been able to keep it up.
The Traction Slide
This is the most obvious and main pitch deck slide for showing your startup’s growth.
Use a simple graph to display your growth rate.
You may also include a call-out data point that really highlights how superb your traction is. By adding this data, you’ll show growth in a pitch deck effectively.
What Types Of Growth Can You Show In Your Pitch Deck?
There is more than one metric of growth in a startup. While different investors may have their own preferences, you need to hone in on one where you are excelling and can continue to excel through your next funding round.
Common growth metrics used include the following.
How many free or paid users and customers has your startup acquired? At what pace are you adding new ones?
This is obviously even more important for those leaning toward a freemium model, and pre-revenue startups.
In units, how fast has your sales volume been growing?
This is especially important if you are a volume-based business, or B2C, versus an enterprise startup that is targeting fewer customers, with much more value, and long-term contracts.
The purpose of a business is to generate revenues and profits. How well are you doing at driving these key, foundational metrics?
Some startups and businesses like to measure and display growth in the form of employee count.
While this can be a sign of a growing business that is doing well, and needs more people to serve its growing customer base, it isn’t always a fundamental that directly translates into positive revenue and profit growth.
How much of your market do you own? How well have you been doing at consistently increasing your market share, to become the dominant player in your industry?
This can be another potential indicator of real growth. How many states are you licensed in? How many countries do you have a presence or customers in?
Adding this information is an excellent way to show growth in a pitch deck.
Keep in mind that in fundraising, storytelling is everything. In this regard, for a winning pitch deck to help you here, take a look at the template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
Remember to unlock the pitch deck template that is being used by founders around the world to raise millions below.
Ways To Support Your Growth Forecasts
Other ways to support your growth and how fast you say you can grow may be worked into these pitch deck slides:
- Financial forecasts
- Team resumes
- Market Size Slide
- Problem Slide
- Customers & Engagement Slide
- Amount Being Raised & Use Of Funds Slides
Growth is a vital metric in the health and success of startups. As well as a pivotal data point for fundraising.
Understand how this is so important to you, your company, and those you are pitching. Find the data points you can win and raise on. Then present them well in order to keep fueling that growth with the capital and focus required. And that’s how to show growth in a pitch deck.
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