Neil Patel

I hope you enjoy reading this blog post.

If you want help with your fundraising or acquisition, just book a call click here.

What to include in the forecast slide of a startup pitch deck?

The forecast slide is one of the most powerful in a startup pitch deck. It can be the bulk of your pitch as an early-stage startup. At every stage, it is how you show the vision, potential, and attractive financial rewards for potential investors. It is certainly pivotal in creating the needed sense of urgency required to get your audience to take action.

In turn, obviously, what you include on this slide can make all the difference in getting funded. As well as how much you are able to raise in an individual round, and the terms you will be offered.

So, what goes on your forecast slide? Where does it belong in your pitch deck? How else can you support and augment this slide throughout your presentation?

*FREE DOWNLOAD*

The Ultimate Guide To Pitch Decks

    What Is The Forecast Slide In A Pitch Deck?

    Here we are specifically talking about the Financial Forecast slide in a pitch deck.

    This is where you are forecasting and projecting what you hope to achieve as a company, with this investment over the months and years ahead.

    This is mainly about the finances, income, and profits of the business. Though there may be other supporting and related data on this slide.

    As an early-stage startup, you may have no existing or historical financials. This may be the only financial data you can give your investor audience.

    Even as a mid to later-stage startup, this is where you paint the picture of what’s next. Of what they can expect from your business. As well as the financial returns, risks, and rewards for themselves, and their investors.

    See How I Can Help You With Your Fundraising Or Acquisition Efforts

    • Fundraising or Acquisition Process: get guidance from A to Z.
    • Materials: our team creates epic pitch decks and financial models.
    • Investor and Buyer Access: connect with the right investors or buyers for your business and close them.

    Book a Call

    The forecast slide is presented as a spreadsheet.

    You may or may not need help creating the visuals here, or running financial models to decide what to present on this slide.

    Where Your Forecast Slide Belongs In Your Pitch Deck

    The forecast slide comes after the midpoint of your slide deck. Right after your existing financials, if you have them. Or your Customers and Business Model slides if you don’t have financials to report.

    It comes right before your slide with the amount being raised and other investors, and then the Use of Funds slide.

    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.

    What To Include In Your Forecast Slide

    Let’s talk about what to include in the forecast slide of a startup pitch deck. As with your overall pitch deck and presentation, the key here is to keep it simple.

    This may be one of your more complex slides and one that investors will spend the most time viewing due to the amount of content on it. Yet, do not overcomplicate it. Make it as simple and efficient as possible.

    Investors need to be able to digest and process this slide in 30 seconds or less. Which is still well more than 10% of the entire time they will spend on the average pitch deck.

    This is a basic financial forecast. You do not need to list out all of your individual expenses and each line item one by one.

    Focus on the main financial data points. Even more so on the one main KPI that you are carrying through your entire deck.

    These are some of the main data points or line items that you might include on your forecast slide. If they are applicable to your specific startup.

    CAC

    Customer Acquisition Costs (CAC) are a very important data point for startup investors. This one metric tells them an immense amount about your company, and you as its leader. Your CAC can make or break you.

    Your operational expenses or OpEx are separate from this and can also reveal a lot about your carrying costs, how well you manage and invest the funds you are given, and where money is being used in your company.

    Sales Volume

    This line forecasts how many units you expect to sell in each period in your table. As a new startup, you will be starting from zero. For operating startups, you are beginning from where your previous financial slide left off.

    How much you can forecast to sell obviously directly relates to your CAC, and the amount being invested in this round.

    If you are running a freemium business model, and are focused on users rather than sales, this line can be your user count. Remember to include in the forecast slide of a startup pitch deck.

    Revenues

    Since this is a business, revenues are one of the most fundamental line items to include.

    Investors want to know how much cash is coming into your business, and when. Even if you are not profitable yet, and that is not a priority for them, cash flow is very important.

    Depending on your business model, you may have revenues from new customers, as well as Annual Recurring Revenues (ARR), and Monthly Recurring Revenues (MRR) if you have a subscription, licensing, or other repeat business model. If you do, then retention and churn rates become more important to talk about as well.

    Profit Margins

    Gross profit margins are also an important metric. As a new startup and entrepreneur, this tells potential investors a lot about whether you know your industry, have bothered to do your market research, or are just trying to scam some novice investors out of their money on a dream that is too good to be true.

    For example, if you are in the restaurant business, and the standard is a 35% target gross profit margin, and you are forecasting 70% profit margins, something is up. Either you’ve finally cracked a unit economic that no one else has managed to in history, or you don’t know the business, have missed out on calculating a lot of expenses, or don’t understand the nuances of the business.

    Monthly Burn Rate

    How much money is your company burning through in expenses each month?

    While you may certainly raise more money during the period you are forecasting for; this metric tells investors how much money you really need just to survive, or how long their capital will last.

    When you include existing financials, this reveals how long your company can survive without a fresh round of investment. If you are a couple of weeks away from not making payroll, then they definitely have the upper hand in negotiations. They will be able to dictate much tougher terms, than if you still have half of the cash from your last round in the bank, and a lot of runway left.

    Break Even Point

    If your company is not profitable yet, investors will certainly want to know when you can begin breaking even. Or, your break-even point.

    While some prioritize scale and valuation over profitability, you should absolutely have a path to profitability. Which you won’t reach until you can manage to break even, and cover your own operating costs.

    Even if you are not raising money, your team needs to know how much they need to sell in order to keep the company alive and keep their jobs and options moving into more valuable territory.

    Headcount

    Some entrepreneurs have begun including this data point in their forecast slide. It has often been used as a data point to show the size of an organization, and as a growth metric.

    Your headcount will almost certainly grow as your sales do. Hiring and team expansion is a very common use of funds when startups are raising. It is a major category of expense. So it is very relevant in some cases.

    Just don’t overly complicate this slide with additional data points like this, if it isn’t the main point you want to convey.

    Balancing Bold Vs. Realistic On Your Forecast Slide

    This is a delicate balance. You want to think and aim big. Investors want you to be bold and aggressive. It is the only way that you are going to be able to generate the types of returns that they are looking for.

    However, your forecasts do need to be based on reality. They have to be based on credible data and a real, viable plan.

    You can’t just say that you are going to hit $1B in sales next year, if you don’t have marketing and a sales process that works, and you aren’t raising enough capital, with enough team members to make it feasible.

    Going back to the restaurant example, you aren’t going to sell 10,000 meals in-house per day, when you can only seat 50 people, and the average number of table turns a day is just six.

    Though do remember that you can forecast based on the investors you are bringing in, and major scaling multipliers. Such as landing new B2B clients, who may bring you thousands of customers each.

    Leveraging Your Existing Financials To Project The Future

    Your existing financials and current performance are a great foundation for your future forecasts. Remember to include in the forecast slide of a startup pitch deck.

    It is something tangible and real that you can multiply for investors, based on their investment. It’s not just a dream.

    If you have nailed your marketing, product-market fit, and unit economics, your forecasts are simply multiplied by how much new capital you are bringing in to scale what you have been doing.

    Has your company yet to start earning profits to impress investors? You’ll need more detailed information about how to present financials for a startup with no revenue. Check out this video I have created explaining how it’s done. You’re sure to find it helpful.

    How Far Out Should Your Forecast Go?

    Your forecast may begin with a month-by-month breakdown for the first year as a brand-new startup.

    Then go out for three years, on an annual basis.

    Three to five years used to be common. Especially for traditional business plans. Though the world is moving even faster today. The younger your startup the more that is likely to change within your business as well. You may completely change your business model, product lineup, and expansion path in six to 12 months.

    Where Else To Use Forecasting In Your Startup Pitch Deck

    There are a variety of other slides and parts of your presentation and fundraising materials that can be used to support your forecasts. Either directly or subconsciously.

    This includes:

    • The Problem Slide: What is the big problem you are setting out to solve?
    • The Market Size Slide: How big is the market potential, and how much are you targeting?
    • The Traction Slide: What is the trajectory of your growth on your graph on this slide?
    • Milestone Goals: What specific goals are you laser-focused on achieving next
    • The Team: What has your team, including your advisors, accomplished in their previous roles?

    Be Ready To Answer Questions About Your Forecast

    The forecast slide is probably one that you will get the most questions about from investors in the question-and-answer portion of your pitch.

    They’ll want to know the research you benchmarked and based your assumptions on, how you are making the mental leaps and justifying such growth, and even what the worst and best-case scenarios may be on the fringes of the forecasted numbers you chose to present.

    Prepare to answer these questions well and clearly. You may also include sources for this data in your appendix or data room.

    Summary

    The forecast slide is a very important part of every pitch deck. While investors will have their own ideas, this is going to be the basis of a lot of their thinking.

    Know where it belongs in your pitch deck, what should and shouldn’t go on this slide, and how to make the most of it to optimize your fundraising efforts. Take the time to learn what to include in the forecast slide of a startup pitch deck.

    You may find interesting as well our free library of business templates. There you will find every single template you will need when building and scaling your business completely for free. See it here.

     

    Facebook Comments

    Neil Patel

    I hope you enjoy reading this blog post.

    If you want help with your fundraising or acquisition, just book a call

    Book a Call

    Swipe Up To Get More Funding!

    X

    Want To Raise Millions?

    Get the FREE bundle used by over 160,000 entrepreneurs showing you exactly what you need to do to get more funding.

      We will address your fundraising challenges, investor appeal, and market opportunities.