05 – PITCH DECK TRACTION SLIDE – 10 SLIDES TO VC FUNDING SUCCESS

5: Pitch Deck Traction Slide: 10 Slides to VC Funding Success

❏ Today, in Part 5 of my series on 10 Slides to VC Funding Success, I’ll speak on 5: Pitch Deck Traction Slide – 10 Slides to VC Funding Success.

The Traction Slide is the fifth page of every successful VC Pitch Deck. After discussing the solution slide, your audience’s mind asks, “What market traction do you have?”. What does traction mean? It depends on whether you have any sales yet. If you do have sales, it is as simple as how many sales you have had. If you have not yet had sales, then traction is a measure of what customer interests and commitment you have gotten.

What is traction? You will be able to learn in this article the answer to this question and what you need to show on your Pitch Deck Traction Slide.

My History:

One of my responsibilities as an executive coach is to assist company founders with creating their investor pitch deck. Throughout my career, I have made and reviewed many investor pitch decks. Upon reflection, I realized that some of our team’s investor pitch decks, especially early in my startup career, were “horrible.”

Sometimes, our teams were successful in raising money from investors. Many times, they were not.

I never thought that the content and presentation style of the investor pitch deck might be hurting us. Boy, was I ever wrong? Working with many investors taught me what they want in an investor pitch deck. In my last company, we raised $87 million over rounds A, B, and C.

So, in this series and an upcoming book, I look to share my hard-learned lessons from 20+ years of being an entrepreneur.

The Investor Pitch Deck Series:

In this series, you will learn the order and importance of each of the following pitch deck slides:

1. Cover Slide
2. Problem Slide
3. Market Slide
4. Solution
5. Traction
6. Competition
7. Monetization
8. Financials
9. Team
10. Ask

This 10-part series covers the ten investor pitch deck slides’ ideal content, order, and flow. You’ll have learned how to craft your story into a successful ten-page investor pitch deck that can get you funded!

When an entrepreneur assembles their investor pitch deck, they usually make a hoard of information. Sadly, they often construct a “book” that is 20, 30, or even as much as 80 pages in length! Most of us humans have a concise attention span. Even ad networks know that most ads over 30 seconds don’t work with consumers. For investors, the successful length of an investor pitch deck is about ten pages and 7 to 15 minutes in presentation length.

Pitch Deck Traction Slide – Why Important?

Last week in 4: Pitch Deck Solution Slide—10lides to VC Funding Success, I spoke about the solution slide and its importance. This week, I’m talking about the Traction Slide, the fifth page of every presentation, and its significance. After discussing the solution slide, your audience’s mind asks, “What market traction do you have?”.

Why? First, you’ve whetted your audience’s appetite with your solution to the problem and the market size. Your audience’s brain is poised to hear how you’ve proved your market by showing who wants your solution!

If you’ve followed this series and your investors are in your market space, they’ll be on the edge of their seats!

Pitch Deck Traction Slide – Content

Please take a look at the example image for this post. What do you see? You see a bunch of company logos! Why? These are the badges of your initial customers, proving the value of your solution. They are either buying from you or are evaluating your product or service for purchase. The logos on this slide convey how much market traction you have. If you have 50+ customers, you want to pick those that have either the largest or best audience recognition.

What if you still need to get customers, even in the evaluation stage? Simple. In most cases, this means you need to present earlier. I would wait to take money from friends and family. Getting some MVP (minimum viable product) to show potential buyers before raising funds is best. I know that this is only sometimes possible. Remember that if you don’t have proof that your concept has ready buyers, you are at higher risk, meaning you’ll have a smaller pool of potential investors. It also says that investors will demand a much more significant “share” of your company if they invest. It’s best to bootstrap (link) your firm until you have an MVP to show.

Pitch Deck Traction Slide – What’s Your Story?

So, what could you say while your Pitch Deck Traction Slide is visible? If you use company logos for the visual content, you will share information about three more of these companies! Why three? You’ve got less than a minute left on this slide. Most people can only remember up to three points about transparency. More than three points per slide will devalue much of what you say.

So, what will you say about each of the three companies? Speak to their size in terms of the potential to buy the product. Next, please speak to the level at which they are currently engaged. Are they in evaluation? Have they placed purchase orders? Have they already made purchases that you’ve delivered? How much have they purchased? That’s it. You’re out of time, and you’ve made your point. Could you let me share an example?

“Our largest client is IBM. They have completed the evaluation and purchased their first 100 seats. We expect them to buy 250 more seats over the next 12 months. Our next largest client is Sales Force Corporation. They have purchased 20 seats. We expect them to buy 100 more over the next 12 months.”. Our third-largest client is Mozilla. They have purchased ten seats. We have 17 other clients currently in the evaluation phase.”. Remember, this is a “first date.” Your audience needs a “taste” of your Traction, not a full meal!

We Can Read or Listen – Not Both!

Most humans can “read” or “listen,” but we cannot do both simultaneously. Your Pitch Deck slide presentation exists to support “the story” you will be telling your audience. Does your investor pitch deck have a lot of words, charts with numbers, or distracting images? Then, your audience will switch their brain into “reading mode” and out of “listening mode.” As soon as that happens, you’ve lost your audience and will struggle to get them back to listening to you! To avoid this, use primarily images and as few words as possible, usually in bullet form. So absolutely, positively, no sentences!

Conclusion

So, I suspect many of you were surprised concerning the importance of the Pitch Deck Traction Slide. If you’re starting to create your first investor presentation, congratulations! You can start on the right foot if you follow my recommendations above. You can go back and look at your Traction Slide and apply what you’ve learned above. You should wait to read the remainder of the series before you present it again. I can almost promise you a better reaction from your audience.