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I am usually happy to give founders brief feedback on a pitch deck. Send email to pitch@probell.com.

What should go in a pitch deck?

Investors will decide to pass or take a meeting based on what they see in your pitch deck. Make yours a good one. Graphics that illustrate information about your company can be helpful. Photos and clip art from the internet are not. The care and effort of a nice style speaks well. Proofread your text careful.

Most pitch decks include approximately 1 slide explaining each of the following topics and perhaps a few more, in roughly this order.


Your customer is the person or company who pays you money.

What disadvantage will your customers have if they don't buy your product?

If your product benefits the world, that's nice, but be clear about who your customer is.

Quantify the problem with numbers.


What are the key novel features of how your product works?

Don't just say what it does, say how it works in a new way that hasn't been done before.

Use 2 or 3 slides if needed.

The better you explain your invention, the more likely it is that investors will recognize the value.

Why now

Great idea. Why hasn’t anybody done it before?

Something must have changed in the world to create an opportunity. Otherwise, if it's a good idea, somebody would already be doing it.


What are several competitors or second-best alternatives, and what do you have that they don't?

Compare to what the customer truly considers to be the second best alternative. For example: If you sell electric motor bikes in a place with a lot of bicycles, do not compare electric motor bikes to bicycles. Your customers will be people who can afford a motor bike and will be comparing electric motor bikes to gasoline-powered motor bikes. Gasoline-powered motor bikes are the second-best alternative for your customers.

A grid with columns for competitors and rows for the attributes that are most important to customers is very helpful.

The 2-axis quadrant style chart with competitor logos conveys less useful information.

Barrier to competition

What will stop somebody from copying you?

Network effect? Patents? Strong partnerships? Celebrity endorsement? First mover advantage? Brand loyalty? Geographical advantage?

Market size

This is often shown as 3 overlaid circles for annual TAM, SAM, and SOM, progressively from larger to smaller. The numbers are never trustworthy, but it is important to have words that explain what the numbers represent. That helps the investors understand who you customers are.

The smallest number should be at least $100 million.

I like to think from smaller to larger. How many customers are there and what is the average price they will pay?

Pricing/business model

A price per unit? A recurring subscription fee? A royalty?

Go-to-Market strategy

How will the customers who can realize the greatest value from your product find out that you exist?

Direct sales is common for high-priced B2B products. Social media ads is common for B2C products.

Traction and revenue projection

How many customers, unit sales, active users, and how much revenue do you have so far (if any)?

A chart showing numbers per year or per quarter since sales started is helpful.

Also show projected future revenue per year.

It can help investors if you name lead customers.

Regulatory approvals

What steps will you need for regulatory approval? And, when will you complete them? 

A timeline diagram might help.

Not every business needs this section.

Milestones and use of funds

What objectives will you accomplish to increase company value before future funding?

What departments or major purchases will you spend the newly raised capital on?

The team

Who are the CEO, CTO/CSO, and 1 to 3 other key people that will make the company succeed? What about them gives them an advantage over the second best person in the world for their job?

It is common to also name some advisors with impressive credentials. Advisors are easy to find. They have very little skin in the game. Many investors care about your advisors. I don't. I'm betting on you.

The ask

How much money are you raising in the current round?

Do a calculation based on use of funds needed to achieve an objective to arrive at a single number, not a range.

Are you selling newly issued preferred stock with a specific price (a priced equity round) or are you selling convertible debt such as a SAFE note?

If stock, what is the company valuation? Be clear about whether the number is pre-money or post-money.

If debt, what is the valuation cap, and what discount rate, if any, are you offering?

Don't exaggerate

Even if the pitch deck gets you a first meeting, an investment won't occur without due diligence. If you exaggerate your business opportunity to get a meeting, you are wasting everybody's time and hurting your credibility.


This is how I compute a fair current valuation and decide whether to invest in a startup. All estimates are highly uncertain, but a highly uncertain estimate is better than no estimate at all.

1. Estimate most likely year of exit

It is impossible to know when a liquidation event will occur for a startup. However, calculating a valuation requires  using some year.  [Ideally, the whole valuation calculation could be done based on a probability distribution, but picking a single year is more practical.] It is unlikely that a good startup investment will have an exit in 1 year. 10 years is unlikely, too. Guess which number of years from now has the highest probability of the company having an exit.

2. Estimate the market opportunity

First, ignore the big TAM, SAM, and SOM circles of a top-down market estimate. Think about the following.

a. Who is the customer who pays money to the company in exchange for its product or service?
b. If everything goes as planned, how many customers will there be?
c. How much will each one pay on average per year?

Multiply the number of customers by the average amount they will pay per year in the year of highest probability of exit. That's the expected annual revenue. Subtract the annual cost of producing and providing the product or service from the revenue to determine the expected annual profit.

3. Scale by a valuation multiple

Company valuations assume that sales of current products will continue for some number of years. This is the valuation multiple. It is typically in the range of 2 to 10. It depends on the industry and how this company compares to other similar companies. If you don't know, use 3x. Multiply the expected annual profit by the valuation multiple to get the best-case future valuation.

4. Discount for probability of failure

There are many ways that startup fail or give disappointing returns to investors. Here are 12 common ones.

Do thorough due diligence research, filling out a checklist with narrative descriptions. Read it carefully and think about it. Then, guess a probability in the range from 0 to 1 for each of 12 possible kinds of failure NOT happening. That is 1 minus the probability of the failure happening.

Multiply the best case future valuation by each of the probabilities to get the risk discounted future valuation.

5. Discount for the cost of capital

If the investor doesn't invest in the startup, they will invest in their best alternative, which will have a return on investment.

Divide the risk discounted future valuation by (1+R)^Y where R is the rate of return on the best alternative investment and Y is the number of years until the exit. That is the present value of the company.

6. Compare opportunities

Consult with possible co-investors and possible future follow-on investors for their view of the deal and adapt your view of how good the deal is based on your trust of others' ability to assess fair valuations.

Subtract the best valuation that you can negotiate with the current owners of the company from your estimated present value to see how good of a deal is being offered. If the current owners wouldn't accept your valuation, pass on the deal.

Next, look at all the deals available that you could do and sort them by how good they seem. Think about your investing budget (how far behind you are on a target rate of deploying capital). Figure out how many of the best available deals you could do within your budget. When the deadline comes to commit to the deal at hand, if it is one of the top deals within your budget portion, do it. Otherwise, pass.


Macrosoft is a software-as-a-service company raising a round of funding. They make business managements software specialized for yoga studios.

1. It is likely to grow and be acquired by some large company after building out a range of increasingly useful offerings and building a customer base. It is not likely to get acquired in 3 years. Maybe 4. Based on other SaaS companies, 5 years is a bit more likely than 4. It will probably get there before year 6. So, the year of highest probability exit is 5.

2. Macrosoft expects to charge $250 per month ($3000 per year) from gyms. There are about 15k gyms who would choose Macrosoft over other offerings. There will be a lower level product for yoga studios at $150 per month ($1800 per year) with expected adoption by 25k studios. Together, that is annual revenue of about $90M. Developing and providing the software will cost about $20M. Profit is therefore $70M.

3. B2B SaaS companies might have a valuation multiple of about 5x, giving a best-case future valuation of $350M.

4. These are the 12 risk discounts.

The product of all the failure risks probabilities is .25. The future value of the company is about $88M.

5. The investor expects a 25% ROI on alternative investments. At 5 years, that is a cost of capital discount of .33. The result is a $29M present value of the company.

6. If the company is raising money at a $15M valuation, you have a deal that is good by $14M. You are thinking of investing about $500k per deal, you are looking at about 100 deals closing in the next 3 months, and you plan to invest $3M over those 3 months. $1.5M / $500k is 3 deals to be chosen out of the 100. On the day to decide whether to invest in Macrosoft, if a $14M good deal is in the top 3, you do the deal. Otherwise, you pass.