Pitch to Deck to Close: Mastering Fundraising

Intro 00:01
Welcome to Startup Success. The podcast for startup founders and investors. Here you’ll find stories of success from others in the trenches as they work to scale some of the fastest growing startups in the world. Stories that will help you in your own journey. Startup Success starts now.

Kate 00:18
Welcome to Startup Success. Today’s episode is a must-listen for any founder looking to raise capital in this market. I’m joined by Nathan Beckord, who is a true veteran of the venture world. He’s the CEO of Foundersuite and Fundingstack. We’re going to learn the difference of the two companies, and he’s helped 100s of startups raise through his platforms. He also hosts his own podcast called How I Raised It, where he’s interviewed hundreds of founders about their capital raising. Welcome, Nathan.

Nathan Beckord 00:58
Thanks so much for having me. Excited to be here.

Kate 01:01
We’re excited to talk to you. So first you founded two companies, Foundersuite and Fundingstack. If you wouldn’t mind walking us through the differences and tell us about each one, that would be great.

Nathan Beckord 01:15
Yeah, it’s a pretty straightforward evolution. I used to be in raising capital. I used to work as a fundraising consultant and worked in investment banking. That’s what gave me an idea for Foundersuite, which is for startups raising capital. And Foundersuite is a database of investors. We’ve got about 210,000 investors, a “get intro” tool, CRM, data room, pitch deck, hosting investor updates, email, tools, documents, all kinds of stuff, right? So kind of an end-to-end set of tools for raising capital. And that’s been around for a while. We’ve served lots and lots of startups, about 100,000 or so, but we started to get some venture capital firms and also some fundraising advisors using it, because they’d be working with a company or portfolio company or client. But they’d always ask us, like, Hey, I’m using this with my portfolio company, X but I have three other companies I want to help them run their fundraisers. How do I do that? And like, well, we don’t have a way for you to do that. So that was what led to Fundingstack. And Fundingstac is our newer platform, and it’s very similar in many ways. It has a lot of the same stuff, like investor database, CRM, but the biggest difference is you can set up multiple sub-accounts. So the use case is anyone, like a fractional CFO investment banker, VC, who’s helping four or five companies raise capital. That’s kind of what that’s set up for. So yeah, those are my two babies. Very excited about them and proud of them, and kind of fun to have a second child. I guess you could say.

Kate 02:48
Well, as you should be proud of them both sound like they’d be really excellent tools and resources. Foundersuite sounds particularly like it would be very helpful for a lot of our listeners who are primarily founders. Sounds like you have a lot of good information and tools incorporated.

Nathan Beckord 03:06
Yeah, we’ve been around nine years, so we’re not new. I like to claim, now, I can’t, like, totally prove this, but I like to claim we kind of invented this category of software for raising capital. You know, there’s other stuff out there, but, like, we are sort of one of the first ones that come up with, like, an investor CRM, to track all your investors. And frankly, over that period of nine years, we’ve just been adding to it. Every year we’ll add another feature or two to it, so it’s a pretty comprehensive platform. And the way we even think about our roadmap is like, All right, let’s think about every step when raising capital, right? Step one is always figuring out who you should be pitching and talking to. So that’s the database. Step two, how do I get in touch with these investors? That’s the “get intro” feature, right? So we just sort of think about in a pretty granular level, like, what’s every step? How can we make every step of the fundraising process a little more efficient, little easier, because it’s hard, so try to make is easier.

Kate 04:05
It’s daunting. Yes, I mean, I speak to founders like you do all day, and they’re passionate and so knowledgeable about their product or service, right? But something like fundraising – It’s outside their wheelhouse. They haven’t done it before, right? It’s not something they’ve learned about. Yeah. So this is great. When we spoke, I really liked how you broke up the fundraising process and correct me if I’m wrong, but this is what I wrote down: You said it’s number one, finding investors; Two, communicating with them; Three, building momentum; And four closing the round. Are those kind of the stages that you break it up into?

Nathan Beckord 04:45
Yeah. And I would, you know, you can get into almost sub stages, right?

Kate 04:50
Yeah. And I want to yes, yes, yes. Let’s talk about finding investors. Because I can’t tell you how many VCs I’ve had on the show who are so frustrated by founders who blanket out a mass email without doing any research, with the same pitch, you know, intro email copy. It seems like it’s a pretty common practice, right? You would be surprised that more founders don’t know better.

Nathan Beckord 05:18
Believe me, I know this pain. I know the pain of the VCs, because we’re always trying to tell our users, don’t do that. And what’s kind of confusing about fundraising, and I even say this on our talks and webinars and stuff, is like fundraising is a numbers game. You’ve got to talk to a lot of investors. You know, it’s a pretty rare startup that has a list of 10 investors or 20 investors, and they’re successful in raising capital. Usually you need a couple hundred. So that’s what throws people, I think, for a loop. It is a numbers game, but it’s also a relationship game, and it’s not just a raw numbers game. You really have to find and research and qualify, you know, investors who are looking for your type of deal. That’s what I always tell founders, like, you don’t want to just spray and pray. Like, even if you’re in FinTech or SaaS, we have, I don’t know, call it 10,000 FinTech investors in the database.. You have to go dig deeper than that. You can’t just, you know, blast out an email blast to all 10,000 FinTech investors. Find some ones that are doing your type of deal, whether it’s payment processing or banking or, you know, whatever it is. Find people who look for that, because investors are pretty kind of specialized around that. And then find ones that not only do your industry but your stage, your geography, you know, sometimes that is applicable. And so you really want to spend the time, I call it, qualifying these investors, researching them and then really digging in. Dig into their portfolio, which they list on their website, make sure they don’t have a competitor. Look at the portfolio, make sure that they are indeed investing in your type of business, but they don’t have a direct competitor. Dig into the team, find the right person. Because a lot of, especially larger venture funds, you know, the partners will specialize. They might have two healthcare people, two FinTech, you know, a couple AI people. So you gotta find the right person within the fund. And if you, if you do that research and put in that time, yeah, it takes some work, but it will make your fundraise go so much better, and it will also stop pissing off the VCs or who are getting spammed.

Kate 07:27
Right. I hope everyone listening takes note of that, because you’ve really walked us through it really well on the process of how to go from this huge list of VCs and target it down the way you should, you know, even down to the right person within the firm. I think that was really helpful. Now I want to get into the meat of our episode here. You know, you’ve done that, and you have an invitation to come in and pitch. You know so much about pitch decks. I would love to delve into that with you. I think that would be really helpful for everyone listening. If you wouldn’t mind, like, start with the structure. I think that would be helpful. I’ve seen so many pitch decks that have no structure, that are just a mess.

Nathan Beckord 08:15
Yeah. So now by structure, there’s a few ways to define that. One is what I like to think of as a storyline. What is the story you’re trying to tell in this pitch deck? And there are, like, we published a thing a little while ago. It was like, I think we had 12, we call them pitch deck archetypes – 12 different frameworks to tell your story. And you know some of them everyone’s going to be familiar with, like the problem solution framework, right? Here’s a big problem, here’s our solution, and, you know, go on from there. But there are other frameworks, like the crystal ball approach, which is like, hey, look into the future, a few years, where AI is going, and we envision a world where, you know, AI agents raise the capital for you, or whatever, right? Like, that would be my pitch. You know, a futuristic vision.

Kate 09:06
Yeah, futuristic.

Nathan Beckord 09:09
Yes. Investors like that because they’re always, you know, kind of thinking about the future and betting on the future. There’s like the X for Y we’re, like, Booking.com or Orbitz for finding investors. I mean, that could be, you know, something that’s familiar, people know about. We’re the Uber for pre teens or whatever, right? Like, something people are familiar with applied to a new market. So, and I could go on, there’s several different, like, story frameworks, okay, that I think are good to think about, right? Which one fits your business. Another one is, like, the scientific breakthrough, right? You’ve invented a thinner solar panel or something like that, right? That would be sort of like, Hey, we’ve, we’re a bunch of PhDs. We’ve invented something really cool that has massive potential, economic, you know, and, and we have it patented and all that stuff, right? So. First of all, kind of think about your business, which framework would fit into it. And then once you kind of get the right framework, and you might even try, like, two two archetypes to see which one fits, because it’s not always like one size fits all. Then I like to kind of think about that structure. My favorite way to get going next is to, like, start with the opening. The opening is so critically important, right? You have to put yourself in the shoes of the investors. These guys and gals are just getting pitched all day long, every day, non stop, right? That’s and that sounds fun, but it also sounds exhausting. And you know, their attention spans are often kind of short. (right) So the opening is so critical. You’ve got to grab people’s attention pretty much right away and then hook them and maybe I’ll pause there and go on and on, you know.

Kate 10:55
Okay, so what I’m hearing is you’ve got to pick the right kind of framework you’re going to use to tell your story. So you have to have a story. That’s important. And I actually like how you started with that, because I think I’m thinking back to a lot of the pitches I’ve seen. There isn’t a story. There isn’t like, why should I care? Right? It’s just like data thrown up. And then I like that the opening is so critical, you’ve got to hook them in, because I can kind of make up my mind within a few minutes, right? It’s so interesting that you went to the opening. It’s hard to articulate this, but so much is riding on the first few minutes of rapport that presenter makes with the VC firm. Do you think that’s a good way of characterizing it?

Nathan Beckord 11:45
Yeah, absolutely. I mean, there’s got to build that report pretty quickly, and there are different ways to do that. Like one opening gambit, I guess I don’t know if that’s the right phrase. One opening approach I’ve seen people use is your personal story. You know, like, here’s my little backstory, I was a researcher at Carnegie Mellon and I discovered something. Or the sort of like, I found a pain point in my own life that I went out to solve it. That’s kind of the problem solutions framework. Opening up with a story like, Hey, let me tell you about my journey. I used to raise capital for startups. It was always a messy process, you know, and then I came up with this idea to streamline and structure it, or whatever your personal journey is that led you to doing what you’re doing. That’s always good. Another approach is kind of and this is a little riskier, but asking the investor like, Hey, have you ever been in a car crash? You know, it was traumatic, right? Like, what if we had a rear and forward camera. You know, like, kind of weaving them into the story. That’s good too.

Kate 12:53
Or think of a time when you, right right? Okay, I like that. So you should spend, for those listening, some time on your opening. Like that’s a really critical piece of this deck, after you’ve just kind of established what your story is.

Nathan Beckord 13:12
100% and and just to add a little more to that, I love stories that have a little bit of an emotional, depends on the business, but something that has a little bit of emotional connection or tugs on my heartstrings, or has some, you know, makes me slightly teary eyed, or whatever, you know.

Kate 13:28
Right, right? No, I get it. It also is more memorable, right? Like, (Bingo) yeah, absolutely, yes, I like that.

Nathan Beckord 13:36
Memorable. That is the other super critical thing you have to understand. So not only are these people your audience, ADD, short attention spans, but they also, like I said, they’re just getting pitched constantly, and so especially if you’re going to a venture firm, you know, you might be meeting with a partner or someone and you’re one of 20, or maybe even 30 startups, they sit through and hear pitch that week. And then they talk about it next Monday at their partners meeting where they bring it up, like, oh, I met with this. That’s why the memorable part is so key. You’ve got to be memorable because you’re one of 30 they met with, right? And you want just a few crystal clear concepts to kind of burn their way into the investors brain, so that when he or she is at that partners meeting, they can kind of drop those two or three little nuggets. Because otherwise they forget about you, and it doesn’t move forward because you weren’t memorable. And that’s where the emotional story does help sometimes, because you know that that really triggers. So anyway.

Kate 14:43
Right, right. No, I’m glad you keyed in on that, because I think you bring up a really important point that not most founders don’t know this. They don’t realize they hear, you know, 20, 30 pitches a week, and then they wait to talk about it. Like you said, everybody, kind of in the industry, knows Monday is when all the partners get together and talk about the pitches. So you’re right. A few days pass, right? And there’s a lot of pitches in there, I think that’s really important to key on. Yes.

Nathan Beckord 15:15
What’s like the half life of your concept, what are they going to remember seven days later? (Right. Exactly) And it’s only going to be one or two little things. So…

Kate 15:26
Exactly. I like that. I’m glad you keyed in on that. Now, when we get past the opening, are there certain things that you think have to be in the deck? Like you know, I heard one VC said she really needs to see that it’s going to be a huge opportunity. I mean, are there certain things like that that you try to cover, that you encourage people to try to cover?

Nathan Beckord 15:54
Yeah. You know, there’s some good frameworks out there. There’s like the Sequoia Capital outline, which is sort of 10 or 11 slides, market size, oftentimes, problem, solution, team, traction. Those are all kind of, pretty key things to include there.

Kate 16:14
Oh, team. Let’s key in on that – team. I have heard so many VCs say, especially with those early stage, the team drives so much of their decision making. Have you seen that as well?

Nathan Beckord 16:30
100% especially in the early days, right? If you’re pre-seed, seed round, what are they investing in? They’re investing in you and a vision, right? They’re usually, maybe there’s a little bit of product, maybe there’s a little bit of traction, but probably not much, right? So it’s really like, Hey, how big is this potential opportunity, and is this the team I feel confident can pull it off, right? So team is 60, 70% of a pitch in those early – you know, that’s a made up number, but hugely important. (yeah, right.) And team stays important throughout the thing, but, like, you have to sort of establish the founder market fit, right? Why am I the right person to attack and control this market? What have you done in the past that demonstrates your unique advantage, your proprietary advantage, right? Those are super important things. Yep.

Kate 17:22
Okay, I like that – market size, team but then the founder-product-market fit. I haven’t heard it described so eloquently before, but that makes perfect sense. Why is this person the one that’s going to do this? Why are you? That’s what you’re basically convincing them.

Nathan Beckord 17:43
Why you? Why now? Market timing is good too. Many startups you can make the argument. I was at a big conference yesterday called Saastr. (Oh yeah) One of the, I think he was the CTO or CRO of Perplexity, you know, big successful AI company, but he was kind of saying, and I’m paraphrasing this, but he was saying, if we had started six months earlier, it wouldn’t have worked, because GPT wasn’t really ready. If we had started six months later, we would have been too late, and it was kind of like the Why now, right? They nailed that market timing piece, and that’s another piece you gotta explain. Why is now the time to start this where the pieces are falling into place from a technical perspective or marketing change?

Kate 18:29
Oh, great. I like that example you shared too, because it shows, like the way he described that, you’re remembering it the next day, right, and you’re talking about it. So he really honed in on why their timing was so great. What about conclusion? Because I have heard so much differing advice on this. What do you recommend? And people don’t talk about the conclusion very much. I’ve found.

Nathan Beckord 18:55
So, you know, continuing with that sort of story arc framework, right? You start off with some good emotional opening, your personal journey, or whatever it may be, or even the journey of a user, that’s always an issue one. And I like to kind of switch from emotional into more logical things like, why now? Here’s our traction, here’s our right financials, if you have some. Obviously the team we already talked about that. And then I, you know, so kind of getting into logical left brain side of things, and then getting back to a bit of an emotional conclusion, like, Hey, we want you to join us. Here’s why we’re talking to you, if you can tailor the story around why you want them. And so it sort of brings that story arc back to a good conclusion. Now, what’s on that slide? It can be a couple couple different things. I’ve seen a reiteration of problem solution. You know, it’s almost like go back to your slide deck and what was the most exciting, sexy data point in there? Was it some traction? Was it your team? Something else I might conclude with that, because, again, what do you want them to remember a week later? Oh, these guys had a really killer team. Some good traction too, but really good team. Or, you know, these guys had such traction, it was incredible. We gotta hop on this. It’s a rocket ship starting to take off, right? So conclude with sort of your strongest point. And then, you know, have a next step on there too, whether it’s verbal or not, like, you know, we’re raising X amount, it’ll get us to a certain point, and we’d love to have you join. Something like that.

Kate 20:33
Okay, I think you shared something really important that I don’t hear a lot, and I want everyone listening to take note, and that is conclude with your most compelling point, which you don’t, I don’t see a lot of people doing that, and that makes so much sense, because that’s one more opportunity to make yourself memorable. And that is, like you said, whether it’s your team, the traction you’re getting, you know the timing, so that’s what you really have to hone in and conclude with one more time.

Nathan Beckord 21:07
Assume they’re going to remember two things about your entire pitch, right? What are those two things? Really great team, really great traction, really big opportunity, really great team, right? I mean, you can kind of pick and choose, but yeah, just reinforce that. So be memorable!

Kate 21:25
Yes, that’s excellent, because I’ve, you know. And then how important is it? We see this asked a lot that you prove at the end that you know about their firm, like Is that important that you know, I want, we want to partner with you, because you did, X, Y and Z, or you, you know, are known for this in the space, is that important as well?

Nathan Beckord 21:50
Yeah, it is. I mean, I’m borrowing this quote from someone I think we had on our podcast, but it’s like, Show Me, You Know Me, I think is great. Like, show me, me being the investor, that you actually know what we’ve done in the past, what we invest in, maybe some hits and/or misses. And, you know, why are you talking to me? Why are you pitching me right? Because, because you’ve got, you’re an expert in this space, as an example, like, you know, again, I keep referring back to this, but yesterday, I was at Saastr, this big conference. The guy who puts this on, a guy named Jason Lemkin, has a SaaS investment fund. Right? He invests in SaaS businesses, and he’s got a lot of home runs. So you could, pretty easily, you could easily use chatGPT to pull a few sound bites from that and weave that in there and weave that into your discussion. I think it’s always good for the founders pitching investors to kind of flip the tables a little bit too, and not only kind of explain why they’re interested in partnering with them. Think of it like a partnership. But also, you know, interview them a little bit like, you know, tell me about some of the startups that didn’t make it. How did you get involved? Like, you want to make this a two way street, not just a one way pitch. I think that’s …

Kate 23:04
I love that. You know, I will say this, it’s the same advice they give to people interviewing for a job, right? You know, so think back to that, kind of equate it there. What are some things that are like, Nevers like, don’t do this, you know, that stick out in your years of experience.

Nathan Beckord 23:25
I mean, I’ll tackle that by almost flipping the question a little bit like, what are some of the biggest issues I see? Right? Okay, probably the number one thing is just too much, too much text, too much content in the deck. I do pitch reviews with a lot of our Foundersuite customers, and almost every single time I say this is good, there’s some good nuggets in here, but go back and take out, cut out 25 to 30%. I don’t care what you cut, just go back and cut 25% out of this deck. And not only will that declutter the slides, because oftentimes, I think founders overwhelm investors with too much information, but also by cutting out stuff further reinforces the things you do want them to remember. right? It’s kind of like, you know, the white space around notes in jazz, right? (Yes, right, right.) And so that’s, that’s one thing. So a lot of decks are just jumbles. It’s like a business plan, you know, so much text in there. A good little headline on every slide that sort of tells a story, then maybe a supporting image or graph, and like one or two bullet points, that’s sort of what you’re aiming for. There’s another pitch deck template out there, kind of, you, a decade or two old – Guy Kawasaki his template, but yes, he recommends you, you shouldn’t go below, like a 20 point font or something like that. If you have to go smaller than that, you’ve got too much text. And I don’t know if that’s the exact font price, but that’s the concept, right? Yep, no dense text. So that’s a big one, not having the story arc, you know, that’s kind of obvious. Just being too long, too. Like too many slides. You know, I see a lot of decks and founders are determined to get through it in a pitch meeting, like, I got to get through all 24 of these slides, or the investors are not going to understand what I do. That’s a fail, right? Your audience has ADD. My favorite slide deck, and this doesn’t work for everyone, but if you can go in with like five core slides, like problem, solution, market, traction, team. Start with those. Get those five slides perfect, super crisp, super clear, nice diagram on each one, declarative headline on each one, and then just stop there for a minute. Let that sort of ferment a little bit. And then you can add a few more, you know, maybe your go-to-market strategy and things like that. But kind of start with a real simple story arc, like problem, solution, market, traction, team, and then gradually add a little bit more. So I’ll pause there.

Kate 26:09
Excellent advice. I hope everyone listening took note of that as well, because I can’t tell you like you said, how many decks I’ve seen – so many words. And then they just stand up there, and they read the slide, right? And then the investors reading the slide, and they’re, you know, it’s just a joke. It’s not even a presentation. It’s just people reading a bunch of words on slides. I love your advice to start with those core and then talk to them, because it’s actually a presentation, and it just feels more alive. You know, those presentations where they’re just reading, you know, just so much content from each slide. I love how you boiled it down. That makes a lot of sense.

Nathan Beckord 26:55
Well, I totally agree with you. I hate that when founders read their own slides, because the investors sitting in the room there can read that slide faster than you can verbally say it. So, you’re actually, like, throwing a little chaos into their brain.

Kate 27:12
Right, exactly. So that’s excellent. I can’t believe this. We’re actually coming up on time. (Oh my gosh.) I know you’ve given us so much info. Any like, and I’m we’ll wrap up with where our listeners can find you and your podcast, but before we do that, any last kind of parting words of wisdom around the deck that you can share? I mean, honestly, you’ve shared so much helpful information. I think people just take note of what you’ve already shared. It’s so much improvement already, but..

Nathan Beckord 27:45
You know, I think we’ve covered a lot. Start with those five slides. Start with 20 point plus font. Start with a really good headline for each slide that kind of tells the story just in the headline. We are crushing it with our traction, right? We’re crushing it with our traction, 30% month over month growth, whatever that, that sort of headline is, and then a supporting bullet or two. Start with that, get that nailed. And then, I guess the other part is practice it so many times, to fellow founders, to friends, to your attorney, to your accountant, to any friendly investors you might know, so that just becomes totally fluid, right? Where it truly becomes conversational, and like, you could do it blindfolded. I tell this story sometimes I was helping a company, this goes back a while, butI was helping a company raise capital, and I was sort of the fractional CFO on this team, and we would drive down to Sand Hill Road all the time and pitch investors, and one time, the CEO’s laptop didn’t work, and he couldn’t load up the deck. And that sounds like a disaster, right. But instead, the CEO is like, you know, laptop’s not working, I can’t show you the deck. Let me just talk through what we’re doing and why we’re doing it. And it was just a conversation, and it was actually one of the most effective pitches I’ve ever seen, because it was like no crutch, no slide as crutch, no distractions of him reading this slide, nothing like that. It was just conversation. And you know, kind of think of that. That’s what you’re aiming for, to be able to give your pitch in a very fluid, conversational, two directional way. So yeah,

Kate 29:26
That is such a great story to end with, because to me as somebody, and I would think that all these investors who look at all these decks, just that conversational approach, and they know it so well, this easy going, no stumbling, that’s pretty powerful. It’s a good example. Thank you. (You bet). Thank you for all that you’ve shared today. So where can listeners find your two solutions and then tell us where they can also find your podcast?

Nathan Beckord 29:54
Yes. Thank you for the plug. Foundersuite.com, and that is the startup focused platform. Check it out. You can go in and create a free account. Doesn’t give you all the bells and whistles, but you can play around for free. And then if you are a VC or fundraising advisor or fractional CFO helping companies, Fundingstack.com is our sort of enterprise version of that, with a few more bells and whistles. So check that out. And then our podcast is called How I Raised It. And you can find it on iTunes, Spotify, SoundCloud, YouTube, just, you know, look it up. I think we just crossed 300 episodes, mostly founders talking about how they raise capital. You think it would be very repetitive at 300 – I’m still getting, like, new little nuggets and hacks and tips, and it’s, it’s just interesting, you know, to hear how people do it. And then, last but not least, happy to connect on LinkedIn, Nathan Beckord. Maybe just mention that you found us on this podcast. I get a lot of random invites, so if I hear that, you know, you listen to this podcast, I’m happy to connect, that’d be great, or you’re Burkland clan or something like that. That’s pretty much it. Yeah, happy to help.

Kate 31:12
Nathan, this was so interesting. You shared so much good information. It’s obvious that you know this inside and out. And I would really encourage all the founders listening to go check out your podcast too, along with your software solution, just because the more stories you hear, the better prepared you are. What a great resource. Thanks so much for making the time to be with us today.

Nathan Beckord 31:36
You bet thanks for having me. Appreciate it.

Intro 31:37
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