A ten-minute pitch used at venture fairs and first meetings with investors should (almost) always include financial projections.
But most entrepreneurs do them wrong.
Any type of graph is useless. Use a table. Investors are numbers people who are most comfortable with real numbers. Save graphs for data sets of greater than 30 numbers.
The table must be legible. Why put up anything that the audience can’t read? Simplify, simplify! Strip it of all chart junk, and make the point size of the numbers as large as possible.
In terms of formatting and use, there’s a huge difference between a financial projection slide flashed on the screen for 20 seconds as part of a 10-minute presentation, and financial statements or spread sheets or projections printed in a business plan. Don’t confuse the two.
The Ten Rules below are for financial projections used in short slide presentations. (Financials that are meant to be analyzed in a back-up slide, a hand-out, or business plan should revert to the normal level of detail appropriate for their context.)
Ten Rules for Financial Projections in Slides
1) Use a table, not a graph.
2) Make the font legible font (sans-serif; not less than 18 pt for anything; 24 is better).
3) Round to nearest 1000, and add the legend “($000)” Example: $1,236,354 displays as 1,236.
4) Two lines are enough: Revenue (or Sales) and Net (or EBITDA).
5) Show actual calendar years, not quarters and not “Year 1, Year 2″
6) Use a horizontal table with years across the top row.
7) Go out three to five full years in the future.
8) Don’t label “actual,” “estimated” (not 2008A, 2009E, 2010E).
9) Put nothing else on the slide except the table. No extra bullets or images. No long title of summary statement—save it for your narrative.
10) All you need for the slide title is “Financial Projections.”
Why is it so important to strip the financials down to the bare minimum? Because in the context of the short presentation, there’s only time to make a few high-level points with the financials. The time to impress with your spreadsheets and modeling is later, after you’re finished with the overview.
Put any important financial “so whats” into your narrative, and not into bullets that will distract from the numbers. Let the numbers on the slide stand pure as you verbally reinforce the points you want the audience to remember.
Bad example
Here’s the original slide. Pretty ugly!
Corrected Example
Here’s the changed version of the slide above. See how much easier it is to scan, leaving brain space for seeing patterns and thinking about how the numbers relate to the full business story.
Example 2
Here’s another example. You can work some variations on color and formatting, so long as the table is clean and easy to read.
Notice how the “driver line”–the # of clients–is made visually distinct. A driver line is optional, but it can be a good idea if revenue is driven by a distinct metric.
