Pitch decks have always been the key to getting a meeting with an investor. The secret is in networking — conferences, meetups, and happy hours have all been ways to get warm intros to VCs. In the current crisis, all of those in-person opportunities are gone. This means the onus is fully on your pitch deck to make your business stand out to investors. As part of the 2020 DocSend Startup Index, we recently released research on what makes a great pitch deck (and will be releasing more findings in the Index in the coming months). One of the key findings from that research was the importance of the “Why Now” slide.
The importance of the “Why Now” slide
In fact, we found that the “Why Now” slide showed up nearly 54% of the time in successful decks versus 38% of the time in unsuccessful decks. In the decks that did include the “Why Now” slide, investors spent 36% more time on this section for decks that ultimately received funding. It’s certainly a slide that investors want to see, and they will be more likely to fund a deck that has a compelling “Why Now” slide.
This is all true in any scenario, but it’s especially true during the COVID-19 crisis. According to the investors we’ve spoken with, they are putting a lot more thought into their investment decisions right now. While VCs are actively investing (more on that here), they’re framing every investment decision within the context of the current state of the economy. Your job is to convince them why your company is a good bet right now — and the vehicle for doing that is the “Why Now” slide.
But what exactly is a “Why Now” slide?
At DocSend, we’ve seen a lot of pitch decks. 10,000 companies used us for fundraising last year, and altogether they raised over $7.7 billion. The “Why Now” slides among these decks vary in content and title, but the intent of the “Why Now” slide never changes. The point is to tell investors exactly why right now is the time to invest in your business.
The fact is that a lot of pitch decks get this wrong. They get the first half right: A lot of “Why Now” slides end up just being “Why” slides. There’s a good reason our research says that the “Why Now” slide is best situated between the Problem and Solution slides at the beginning of your pitch deck. This trio of slides works together to perfectly tee off your pitch. The Problem slide should essentially explain why your product exists. The “Why Now” slide then drives the urgency for this point before hooking investors on your solution in the next slide.
What makes a good “Why Now” slide?
The key is to make sure that you’re really addressing the now part of this slide. To do that, ask yourself a few things: Would this slide also have been relevant five years ago? Could you see it being relevant in five years from now? If you look at the content of your “Why Now” slide and answer yes to either of these questions, change something. Convince investors that they don’t want to miss the boat you’re captaining.
For whatever problem you’re addressing, ask yourself: What data is there to support that this is a very timely and present issue? Look at the problem you outlined and figure out what numbers from this year you can use to highlight that. And think about your product itself. Are there technologies or trends that your product leverages that are seeing unprecedented traction or popularity? What about the market? Is there a very timely need for the product you’re launching? The “Why Now?” slide should be a snapshot of the current moment and a clear explanation of how your product or service fits in.
Why “Why Now” now?
During this crisis, investors are thinking much more about the current state of business and weighing their investment decisions more heavily. Don’t leave it up to the investor to contextualize your pitch against others they’re seeing. Take into account the environment that we’re in as a result of COVID-19, and offer them the data that shows you’ve done the work to understand how your business fits into this new status quo. This isn’t only an exercise to convince investors, you need to understand how your business will succeed in current economic conditions — and if you’re concerned, you may want to rethink your financial model.
But don’t just take our word for it. Many VCs are giving founders the same advice. We recently caught up with Satya Patel from Homebrew. They just did their first-ever deal without ever meeting the founder face-to-face. Satya had this advice for founders: “The most important things to include [in your pitch deck] now are: 1) How the money will be spent and how long it will last; 2) Why the problem you’re solving will remain an urgent issue for potential customers; and 3) What the go-to-market strategy will be in a world where face-to-face interaction is limited.”
It’s also a good idea to take a step back and look at how the crisis is affecting your target market. Are investors making deals in your area? Or are they holding off to see how things pan out? (You can check out the DocSend Startup Index Active VC List to see a live-updated list of investors that are taking meetings and offering term sheets right now.) Answer some of these questions first to allow yourself the ability to highlight to investors why your company is a sound investment right now.
It’s never a waste of time to tell investors exactly why your company should be top of mind. Driving a sense of urgency is a good tactic in fundraising in general. But it’s important to remember that the fundraising market is still adjusting to the new normal. This is because investors are more heavily weighing how businesses are poised to fare specifically in current times. In the current crisis, the “Why Now” slide allows you to meet investors where their minds already are and answer any crucial questions before they even get a chance to ask.