Pitching? Let Your Dashboard Do the Work

Over the past decade, Jim Calhoun has founded a variety of tech companies—most notably PopularMedia and CustomerClick—and raised venture capital from top-tier venture capital firms such as Sequoia Capital. Along the way, he's discovered a secret weapon in attracting investors' attention: the dashboard.

What's a dashboard, exactly? It's a single screen of information that paints a quick snapshot of your company's operations. On it, you'll see key metrics like sales trends, milestones, customer pipeline, cash flow, and so on. The information is drawn from your own accounting software such as QuickBooks, enterprise resource planning system, or customer relationship management applications such as Salesforce.com or Netsuite. If you're not already using one of these, you can try a Web-based service such as Adaptive Planning. Either way, the figures can be refreshed or updated in real time.

So rather than sending physical documents or e-mailing clunky slide shows to a prospective investor, think about sending them a streamlined version of your dashboard. You can e-mail a dashboard in your initial pitch to investors, or ahead of your first meeting. You'll send it as an attachement or as a link to an online version. After viewing your dashboard, investors should have a better understanding of your company, and they'll probably think you're well organized, too. Plus, with most Web-based dashboards, you can see if the investor has logged in, and how many times, which can be a valuable indicator of his or her interest level.

Configure Accordingly When creating a dashboard, pick elements that show your company's plans and performance, usually in column form; remember, you can always adjust if necessary. If you only want investors to see data on certain items or from specific time periods, you can configure that, too. "I've spent years stripping out stuff from our dashboards and feel like I've developed something useful for all sorts of company types," Calhoun says. Here's a template.

Time periods: For early-stage companies, a dashboard should focus on plans or projects you hope to complete in the short run. So you may want to include a column for the next three months and a summary column for the current quarter.

Pipeline: Investors are certainly interested in your potential customers. Devote one column to your coverage pipeline, which provides an indication of whom you'll likely be selling to, and then indicate the average order size. Keep in mind that a dashboard allows a user to "drill down" and get more information on each item, so if you or an investor want to see each potential order in May, it's just a click away. Finally, for each of these categories, have a line for "plan" and "actual," which lets the dashboard track whether your company is meeting its goals.

Cash Flow: Investors want to know your burn rate, or the amount of money you spend each month. Show this with columns indicating total revenues, expenses, and cash flow.

You'll probably want to add some additional metrics that are relevant to your particular company. For example, if you operate a content Web site, then you would probably focus on Web traffic, conversion ratios, and cost per acquisition. You want to choose criteria that let you go beyond making projections to measuring results.

A Versatile Business Tool Of course, dashboards are not just for funding; rather, they can be a powerful tool to help run a better business. You can create dashboards to use when meeting with your sales teams, board, or clients. "Dashboards are great for keeping everyone on the same page and honest about the state of the business," says Calhoun. Considering that dashboards are really just a few lowly columns of data, that's quite an endorsement.

Before it's here, it's on the Bloomberg Terminal.