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Q3 2020 is primed to be an intense shopping season for VCs

Founders are in a great position to fundraise right now. VCs are ready to deploy capital and are activity searching for businesses to invest in. Time to make the most of it.
Russ Heddleston Contributor Russ is the co-founder and CEO of DocSend. He was previously a product manager at Facebook, where he arrived via the acquisition of his startup Pursuit.com, and has held roles at Dropbox, Greystripe and Trulia. Follow him here: @rheddleston and @docsendMore posts by this contributor

With the high possibility of an extremely active fundraising marketplace for the rest of the year, founders need to know how to take advantage of it. As you can see from the DocSend Pitch Deck Interest Metrics, spikes in the marketplace previously have resulted in some pretty specific behaviors by VCs.

Here are some tips on how to use the increasing levels of VC interest to your advantage.

VCs are spending less time on your deck, so get to the point

We’re seeing record low time spent per pitch deck. We know from previous research that VCs spend on average 3.5 minutes per pitch deck. But over the last quarter that time has dipped below three minutes. That can actually be a good and a bad thing. It implies that VCs are streamlining their process of looking at decks, which means they most likely know what they want. The downside of this is if you break a few cardinal rules right now your deck could end up in the reject pile.

From our research, VCs expect a deck to be around 20 pages. They expect a straightforward narrative that starts with your problem, leading to the solution, and then your product and business model. Our data found that VCs respond best to 35-50 words per slide (too few words per slide is also an issue; you want to offer enough context for your deck to make sense without you presenting it). The only place you can increase your word count is on your Team page. Our data shows the average number of words on a successful Team slide is 80. This gives you room to highlight the founding team’s relevant experience and show how you’re uniquely suited to build your business.

You have to include a “why now” slide and it should mention COVID-19

We already know that investors respond well to a Why Now slide. Our research shows that 54% of successful pitch decks included a Why Now slide, where only 38% of failed decks included it. That slide now has to work twice as hard. We’re hearing from investors that they expect to see information in your pitch deck about how your business has been affected by COVID-19 and how you plan to manage that impact moving forward. Even if the pandemic has had no material effect on your business, the investor will still have the question. Get out in front of it with a well-formed response near the beginning of your deck.

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