Start Working With Keane
Sep 15, 2022

What Investors Expect from your Traction Slide According to 20 Pitch Deck Experts

With the traction slide, we found that it’s not about putting out every single thing on a slide – it’s about putting the right things on the slide.

BY
Keane Angle
Louise Saludo

If it’s one slide in particular that we at STORY love – mostly because investors love it too– it’s the Traction slide.

Talking about our clients’ achievements and finding new ways to present them is really fun.

What is traction? For starters, this refers to any accomplishments and momentum the company has achieved so far.

It’s every founder’s 15 seconds of humble bragging rights and it’s essential.

But that’s a broad definition, so it becomes easy to want to cram every data point and accomplishment possible into one slide.

As one of the only organizations in the world that conducts its own research on pitch decks, we want to be able to give founders more insight into what “good” looks like for investors.

With the traction slide, we found that it’s not about putting out every single thing on a slide – it’s about putting the right things on the slide.

In this research-based article, we’ll cover the most sought-after traction slide data points investors want to see in a pitch deck.

Methodology

We used our tried and true methodology for these types of articles.

First, we found 20 different pitch deck resources online after conducting a rigid background check on authors to filter out the fluff. Next, we pinpointed and analyzed specific investor expectations on the traction slide.

Across these resources, we found a total of 195 opinions. We bucketed each opinion into three major categories and a series of sub-categories.

Here are the major categories:

  • Business Data - 49%
  • Other Achievements - 29%
  • Presentations - 22%

As we can see in the chart above, Business Data is most mentioned by investors. Examples of this include revenue growth, product progress, and margins.

The second top category is Other Achievements, where founders can discuss non-numerical traction related to press, awards, partnerships, Letters of Intent to Purchase (LOIs), and past investments.

Coming in last is Presentation Tips with 22% of mentions. Several of the tips discussed under this category were around illustrating momentum while always providing data within context.

Now let’s look further at what exactly all this data adds up to.

Business Data

A good way to know all about a company’s overall performance is by looking at key metrics. KPIs such as margins, revenue, and market interest are just a few examples that fall under this category.

Verbit, 2019, Series-A

Customer Acquisition

Startup experts in our study stress the importance of customer acquisition metrics. It gained 58% of mentions across all of our resources as investors believe that it is an indicator of customer interest. Metrics such as sales and marketing KPIs show investors that there is a need for the solution being offered.

Some metrics under this category are:

  • Revenue Growth Rate
  • Organic and Paid Acquisition
  • Time to Onboard Customers
  • Marketing Metrics
  • Social Media Insights
  • Sales Pipeline
  • Sales Metrics
“Focusing on Pre Seed and Seed, we see this slide as an opportunity to demonstrate your progress toward validation and as a way of building confidence in the opportunity’s potential for success.”
— Dan Gavel, Director at Black Sheep Capital

Revenue

A great indicator of a startup’s success and momentum is how much money they are currently making with its resources. Founders that generate impressive revenue with little resources means they can scale the startup’s success with the next round of funding.

Revenue ranks second with 31% of mentions in our study. A quick tip that startup experts have is to show recurring revenue by month or by year. Doing so will allow investors to see the trajectory of revenue in the future.

“Obviously seeing revenue in our traction slide going ‘up and to the right’ is seen in a positive light, but the predictability of it (monthly recurring revenue) is also worth highlighting in our traction slide.”
Startups.com

Divvy, 2017, Series-C

Churn and Retention

Ranking third in Business Data is churn and retention. It garnered 8% of mentions in our study.

Churn is defined as the number of customers that leave at a given period. On the other hand, Retention measures the number of customers who continuously use the solution after subscribing or purchasing it.

According to our resources, both metrics are good indicators of product-market fit. Lower churn and a higher retention rate show investors that consumers are willing to pay for the product.

“If you’re ever going to raise money, this is a graph that investors are going to ask for. Like, how much retention do you have? Like, are people actually repetitively using your product? So, retention is the best way to measure product-market fit.”
— Gustaf Alstromer, YC Partner

Margins

By definition, margins measure a business’s profitability. These metric ranks last with only 3% of mentions from our study. We believe that it is less of a priority to investors because early-stage startups may not have enough traction to show revenue yet, let alone profitability.

Moreover, revenue and future revenue potential are usually the primary metrics used when calculating a company’s valuation, with profit margins being less important in formulas. And remember, higher valuations mean higher investor returns.

Bliss, 2015, Seed/Angel Round

“As an investor who knows your company will need gross profit dollars to invest in brand-building activities, gross margins that are so thin that a 30 percent swing in COGS puts the company underwater just don't meet my sniff test.”
— Ryan Caldbeck, Founder of CircleUp

Other Achievements

Founders of early-stage companies may find the traction slide difficult to create. Key metrics may not be present for pre-revenue startups. However, this isn’t an indication to skip the traction slide entirely. Investors still want to know the startup’s notable achievements. This category will discuss other company milestones that qualify as traction.

Product Progress

The number one question of investors when it comes to traction is, “Where is the startup in terms of maturity?” Many startups raising funds could be pre-revenue, even though they may have a working beta product. Others could still be conducting market research or launching their pilot in the near future.

Startups could also be in the process of filing patents or regulatory approvals for their product. Either way, it’s important to point this out to investors to show them the startup's milestones.

Product progress ranks first in this category with 53% of mentions, making it a top priority for startup and investment experts.

“The purpose of the traction slide varies considerably depending on the stage of your business. Focusing on Pre Seed and Seed, we see this slide as an opportunity to demonstrate your progress toward validation and as a way of building confidence in the opportunity’s potential for success.”
— Innovation Bay, VC

Castle, 2015, Angel Round

Partnerships and LOIs

Part of a startup’s success is acquiring necessary partnerships — this is especially true for startups with a B2B or B2B2C model. Having LOIs (Letters of Intent) and sales commitments serve as an alternative form of product validation for pre-revenue companies.

Partnerships rank second in this category with 16% of mentions from our study. Despite the significant drop in mentions, we believe it’s still a priority for investors when it comes to the traction slide.

“You could have a slide showing valuable partnerships or endorsements. Partnerships or investment names are always more effective here as this means you have agreements in place. Endorsements can also be used if an investor/company gives you permission to use their brand during your pitch.”
— Alejandro Cremades, Startup Investment Consultant

Yomp, 2014, Seed/Angel

Customer Discovery Research

Startups that are still in the process of validating market interest could show the results of their research to prove to investors that there is a need for the solution.

Customer Discover Research ranks third in this category with 12% of mentions from our study. We believe that investors look for this type of traction as proof that someone is willing to pay for the product or service. Plus, it even shows that founders are listening to their customers actively, which is a fantastic bonus.

“Let’s say you’re pre-product; points of traction you can talk about are the number of customers you’ve met with, the number of design partners you’re working with, the number of customers that say they’re willing to try or buy your product, or the number of customers you’ve spoken to that have confirmed your pricing is spot on and they have a willingness to pay.”
— Steve Barsh, Managing Partner, Dreamit Ventures

Daily Hundred, 2015, Series-A

Press and Awards

Does the startup have any notable press or awards? Now is the time to humble-brag and show off. Add in a short quote from Forbes, or a glowing recommendation from partners and customers. This serves as social proof that the solution could make big waves within the industry.

Likewise, if the startup has received notable awards in the past, add it to the slide.

Press and Awards rank fourth in this category with 9% of mentions from this study. While it may be at the lower end in terms of ranking, it’s still an impressive addition to a traction slide.

“Getting in the press used to mean less than it does today since most media has moved to social media and the bar to get there is nearly zero. Still, some third-party validation of the press doesn't hurt either.”
Startups.com

Past Investments

If the startup has acquired funding in the past, the traction slide is the perfect spot to show that off. Past funding serves as a recommendation that an investor has seen the potential in the solution, further encouraging others to invest as well.

This ranks fifth in this category with 7% of mentions from our study. It’s an optional, yet powerful addition to the traction slide.

“Venture capital basically runs on gossip and FOMO. You try to get gossip on which companies are killing it, you try to get in, and then you try to create FOMO for everyone else. Rinse, repeat.”
— Magdalena Kala, VP of Consumer Investing, Bain Capital Private Equity

Key Hires

Having a stacked founding team with diverse experience also counts as traction according to resources in our study. This tells investors that the team has a well-rounded set of skills and the necessary connections to lead the startup to success. Furthermore, displaying an impressive founding team also reflects the founder’s ability to attract top talent.

Key Hires ranked last in this category with only 4% of mentions in our study. Similar to Past Investments, it’s optional yet impressive to have.

“The primary purpose is to show that you have the team with the expertise, connections, and know-how to get the ambitious plan you’ve laid out in your deck executed.”
— Peter Adams, Executive Director of Rockies Venture Club

Presentation Tips

There were 42 opinions categorized into this bucket. Overall, this bucket emphasizes different ways to present the data investors want to see on a pitch deck.

Be Brief and Simple

We found that brevity was the number one priority when creating a traction slide. Experts advise against crowding the slide with data, making the entire slide confusing and unfocused. It’s no surprise that they suggest being strategic in presenting metrics. This means choosing which of the company’s current metrics are best to be highlighted based on the stage of the company.

“Be comprehensive, but don’t be excessive.”
—Dan Gavel, Director at Black Sheep Capital
Aeries Health, 2019, Series-A

Show Context With Data

Context places second in this category; it refers to presenting the data within a narrative that makes sense. This also provides investors with a clearer picture of which stage the business is at.

Furthermore, context also pertains to where the traction slide sits in terms of slide order. Investors recommend that the traction slide sits right at the front half of a pitch deck.

“I like to see a traction slide about 3/4 of the way through the deck. You’ve laid out this story…and then you bring up the traction and it shows how it’s all coming together.”
— Steve Barsh, Advisor, Dreamit Ventures

Another good tip is that, if needed, it’s okay to expand the traction slide into several slides — up to three at most— and categorize these per kinds of traction. This could illustrate and emphasize traction even better without losing organization.

For example, if you have traction all about your business accomplishments, this could be a Business Traction Slide. The next slide could be all about customer performance and reviews— this could be a Customer Traction Slide, and so forth. eShares’ pitch deck does just this, by splitting their traction into slides, categorizing their traction between revenue MoM and individual customer revenue growth:

eShares, 2015, Series A
eShares, 2015, Series A

Data Over Time

Data over time comes third, meaning the metrics should be shown chronologically to show change over time, as shown here on twine.fm’s traction slide:

twine.fm, 2017, Seed/Angel Round

“The more historical performance you have, the more details you should give.”
— Remi Goncalves, Founder, SharpSheets.io

Show Momentum

Our count for Momentum is a solid tie with Data Over Time, both having 17% of all mentions. This makes sense given that both sub-categories go hand-in-hand. Momentum shows the startup's steady trajectory towards success. This shows investors that founders can scale their current success in the future.

While data over time refers to data shown as a timeline, momentum can be any form of consistent achievement that can be further scaled. For example, initial number of customer sign ups, higher retention rates, and so on.

“Once you’ve established that you’ve already built something impressive, then you have the credibility you need to show how it could grow into a massive company. Venture capitalists are looking for outsized returns, so they have to believe your company can get there.”
— Janelle Tam, Co-founder, Magid & Company

An example could be Aircall’s traction slide, which very cleanly illustrates the rise of their company’s retention in both growth and net percentages:

Aircall, 2020, Late Stage

Don’t Over-exaggerate

Lastly, experts stressed the importance of being honest with the metrics presented. Investor relations is all about trust. Inflating actual numbers will cause more harm than good, especially during due diligence. The same goes for things like LOIs or negotiations; saying the company is “in negotiations” with another huge brand is not the same thing as receiving an email from them requesting a meeting.

“Never breach confidentiality, and never over-exaggerate.”
— Alejandro Cremades, Co-founder, Panthera Advisors

What do investors want to see in the traction slide? Concise content, business data, and momentum.

The traction slide is where founders show what they have been able to do with current resources. Our study shows that traction isn’t only limited to key metrics, but also involves product progress, partnerships, and other key milestones.

Moreover, startup experts suggest adding context to the data by showing trends over time to exhibit where the startup could be given its current momentum. Lastly, experts advise founders to be concise when creating the traction slide, just like everything else in a pitch.

Traction varies depending on the startup’s maturity. But, no matter how small the progress is, early traction is still meaningful.

A powerful traction slide isn’t measured by the number of metrics displayed. On the contrary, it’s all about showing a clear trajectory for success.

  • AN INVESTOR-READY STORY -

    We ensure your deck has everything in it that investors look for so your startup can land more meetings more often.

  • CONVINCING SLIDE COPY -

    We’ve written hundreds of decks since 2018; we know what works, what doesn’t, and how to embody the tone you’re going for.

  • ON-BRAND, POWERFUL VISUALS -

    For most startups, your brand begins with your pitch deck. We work with existing brands, and even create brand-new ones.

subscribe

Get Access To Our Pitch Deck Insights.

Sign up and get the knowledge you need to succeed.

client testimonials

Here's what past founders are saying:

Keane and his team run an incredible and valuable process. I saw a night and day transformation in how we articulated our business and vision, which yielded immediate results even before the deck was completed. I feel significantly more prepared and confident to engage with leading investors on our business idea as a direct result of Keane's work.
Kris Sandor, Co-founder & CEO
Sunlight Technologies
It was a pleasure to work with Keane on our pre-seed fundraise deck. Our deck looks sleek, to the point and communicates the important information. If you are looking to raise venture capital funding and want to create a document that can capture attention and convey the right message, it's worth the investment to work with a pro.
Sena Zorlu, CEO
Piku Games
I am exceptionally happy with the deck that Keane put together. Keane doesn’t just make a pretty picture, he provides thoughtful feedback to help fine tune a concept and craft a compelling narrative around it.
Akiva Wagner, CEO and Co-founder
Macrobox
-->