Market Size — TAM, SAM, SOM
Investors want to know the size of the opportunity. Get these three numbers right.
How to present it
Use a visual TAM → SAM → SOM funnel diagram on your slide. Put the biggest number at the top (TAM) and narrow down to SOM. Cite sources for every number. Never use made-up market sizes — investors will check.
Traction Metrics — What to Highlight
Traction is the #1 thing investors look for. These are the KPIs that matter most.
| Metric | What It Means | Good Benchmark | Great Benchmark |
|---|---|---|---|
| MRR / ARR | Monthly/Annual Recurring Revenue | $10K+ MRR | $100K+ MRR |
| MoM Growth | Month-over-month revenue growth rate | 10-15% | 20%+ |
| Net Revenue Retention | Revenue retained from existing customers (incl. expansion) | 100% | 120%+ |
| CAC | Customer Acquisition Cost | Under $500 | Under $200 |
| LTV | Customer Lifetime Value | 3x CAC | 5x+ CAC |
| Gross Margin | Revenue minus COGS / Revenue | 60% | 80%+ |
| Active Users | DAU/MAU ratio for engagement | 20% DAU/MAU | 50%+ DAU/MAU |
| Churn Rate | % of customers lost per month | <5% monthly | <2% monthly |
LTV = ARPU × Gross Margin ÷ Churn RateCAC Payback = CAC ÷ (MRR per customer × Gross Margin)Net Revenue Retention = (Starting Revenue + Expansion - Churn) ÷ Starting Revenue
What to include on your slide
Pick 3-5 metrics that tell your best story. If you have strong retention, lead with that. If you're growing fast, lead with MoM growth. A revenue growth chart (last 6-12 months) is worth a thousand words. Highlight the trend line, not just the absolute numbers.
Benchmark against your stage. A seed-stage company with $5K MRR is different from a Series A with $100K MRR. Show your metrics in context. Transparency builds trust — if a metric is weak, explain why and what you're doing about it.
Financial Projections — Revenue Model, Burn & Runway
Show you understand the economics of your business. Keep it simple and defensible.
Revenue Model
Clearly state how you make money. Common models for startups:
- SaaS subscription — Monthly/annual recurring fees. Show pricing tiers and expected adoption rates.
- Usage-based — Pay-as-you-go. Show per-unit economics and scaling assumptions.
- Marketplace — Commission per transaction. Show take rate and transaction volume assumptions.
- Hardware + consumables — Razor/blade model. Show attach rate for recurring revenue.
3-Year Projection Best Practices
- Show Year 1, Year 2, Year 3 — one page only, not a 10-page spreadsheet
- Include: Revenue, COGS, Gross Margin, Operating Expenses, Net Income, Headcount
- State your key assumptions — number of customers, average deal size, growth rate, churn
- Don't fabricate hockey-stick curves — investors have seen thousands of projections. Be realistic.
- Show a sensitivity analysis — what happens if growth is 20% slower? What if churn is 2% higher?
The best projections are simple. A clean one-page model with 5-10 clear assumptions beats a 20-tab spreadsheet every time. If you can't explain your revenue model in 30 seconds, it's too complicated.
The Ask — Framing Your Funding Amount
How to ask for money without sounding desperate or unrealistic.
The Formula
Your ask should be backed by a clear use of funds. Investors want to know exactly where their money goes.
The 4-Bucket Use of Funds
| Bucket | Typical % | What Investors Want to See |
|---|---|---|
| Product & Engineering | 40-50% | Building the product, hitting milestones, shipping features |
| Sales & Marketing | 25-35% | Customer acquisition, demand gen, sales team expansion |
| Operations & G&A | 10-15% | Legal, finance, compliance, tools, office/remote infrastructure |
| Reserve / Buffer | 5-10% | Unexpected opportunities or challenges (signals maturity) |
How to Name Your Round
- Pre-Seed ($250K-$1M) — Idea, MVP, early validation. No revenue needed.
- Seed ($1M-$3M) — Product-market fit, early revenue, core team. $5K-$50K MRR.
- Series A ($5M-$15M) — Proven PMF, repeatable GTM, strong metrics. $100K+ MRR.
- Series B ($15M+) — Scaling, multiple channels, building leadership.
Don't ask for a round that's too small. Raising too little means you'll be back fundraising before you hit milestones. Too much means you'll give away more equity than needed. 18 months of runway is the sweet spot.
Common Mistakes — Numbers That Kill Investor Confidence
Avoid these at all costs. One wrong number can undo an entire pitch.
The "Everyone is a customer" fallacy
Claiming your TAM is "everyone who uses the internet" or "every business in the world." Be specific. Investors want to see you've identified a real, addressable segment — not a vague fantasy.
Fake precision
Numbers like "$347,892,456 TAM" or "17.3% market share" with no methodology. Round to the nearest billion or million. Cite your sources. If an investor asks "how did you get that number?" you should have a 30-second answer ready.
Hiding bad metrics
Leaving out churn, showing only cumulative revenue (not MRR/ARR), or cherry-picking the best month of growth. Investors will find the hidden numbers. Transparency is a signal of confidence — hiding things is a signal of desperation.
Hockey-stick projections
Showing flat revenue for 2 years then a vertical line in Year 3. Investors have seen this hundreds of times. Your projections should show a realistic growth curve that acknowledges the difficulty of scaling.
No unit economics
Not showing CAC, LTV, or payback period. Even if you're pre-revenue, you should have modeled what your unit economics will look like. This shows you understand the business fundamentals, not just the vision.
Inconsistent data
Growth rate on one slide that doesn't match the chart on another slide. MRR in the traction section that contradicts the financial projections. Errors like these make investors question your attention to detail.
Your numbers tell a story. Make sure they tell the right one. Every metric should support your thesis: why now, why you, and why this is a massive opportunity. If a number doesn't strengthen that story, leave it out.