DocSend Startup Index Data for Q4 2020 Shows All-Time High in Investor Activity

First Full Year of Metrics on Investor Engagement Captures Ups and Downs of a Historic Year

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Jan 12, 2021, 08:00 ET

SAN FRANCISCO, Jan. 12, 2021 /PRNewswire/ -- DocSend, a leading secure document sharing platform, today released fourth-quarter and full-year 2020 data based on its Pitch Deck Interest metrics. In early October, venture capital investor interest and engagement in startup pitch decks reached an all-time high. And across the span of 2020 investor interaction increased by 21% compared to 2019.

DocSend, a leading secure document sharing platform, today released fourth-quarter and full-year 2020 data based on its Pitch Deck Interest metrics.

Underscoring how volatile the fundraising landscape was this past year, pitch deck interaction spanned the highs and lows of the year with a 54% spread. The lowest point of VC interaction occurred in early March, just after the pandemic took hold, bringing fundraising to a near standstill, while the highest point of interaction was in October, eclipsing the demand of previous years.

Through its platform, DocSend is continually measuring the level of engagement between founders and venture capital investors that are reviewing pitch decks from startups around the world. DocSend gauges the fundraising landscape by tracking the frequency with which potential investors are reviewing pitch decks, how long they're spending reading those decks, and how many pitch decks founders are sending out to investors. The Pitch Deck Interest metrics, updated weekly, are a leading indicator of future deal flow and fundings. More information about the metrics and methodology can be found below.

In a period that traditionally sees a slow-down in fundraising activity, startup founders were active in Q4 and across the year in terms of creating and sharing links for their pitch decks. The number of links created in Q4 was 14% higher than in Q4 2019 and reached its highest peak of the quarter during the week of the election. This late-year increase in funding asks could portend similar activity in Q1 2021.

A consistent level of activity was evidenced across all of 2020, with founders creating pitch deck links at a rate 14% higher than the previous year. Founders scrambled for funding in early March, with pitch deck links increasing by 37% from the previous week. This kicked off a spree of fundraising activity as founders rushed to raise capital in the face of economic uncertainty brought on by the then-impending pandemic.

Throughout 2020, investors were spending significantly less time reviewing decks than in 2019. In Q4 2020, the time investors spent reviewing pitch decks was 15.5% lower than in Q4 2019 and was down 12% year-over-year.

Time spent on pitch decks is traditionally lower when there is increased fundraising activity. Savvy VCs simply don't have time to dive deeply into decks and are more likely to quickly scan decks to identify key startup attributes. More than ever, a crisp narrative and informative deck are key for successful fundraising.

"This is the first time, in one of the most active fundraising years ever, that DocSend has released a full year of metrics tracking week-by-week pitch deck interest and engagement," said Russ Heddleston, co-founder and CEO of DocSend. "As we look back on 2020 our data tells the story of how VCs and founders navigated a historic and unpredictable fundraising year. Even with the pandemic, economic crisis, and the majority of the fundraising process going virtual, both investors and startups turned 2020 into one of the most successful and productive years yet."

Expect to See Spur of Activity in Q1 2021

"Traditionally early Q1, especially following an election, is quieter in terms of investor activity for startups and founders. But with vaccine distribution ramping up and a new administration coming to the helm, I expect we'll see a superstorm of activity. Founders are eager to ramp up their businesses amongst the optimism of 2021," said Heddleston. "According to the U.S. Census Bureau, Americans in 2020 were starting businesses at the fastest rate in more than a decade. The surge of new businesses started during the pandemic will be eager to engage in their first significant round of funding."

"While we are in a new year, most of the country remains in some form of lockdown. The way fundraising is conducted in 2021 will be a mix of old and new. Once vaccinations become more widespread, in-person meetings and in-office gatherings will resume, but only to a degree. At this point, founders and VCs alike have gotten into a groove with remote networking and fundraising and will likely stick with what works for them," continued Heddleston.

DocSend will continue releasing quarterly reports via the DocSend Startup Index to track the investment landscape through 2021 and beyond to better inform startup founders on the state of the fundraising market.

Methodology of Measuring the Fundraising Landscape
The Pitch Deck Interest metrics are part of the DocSend Startup Index and measure activity via three key indicators of founder and investor engagement and help startup founders better understand fundraising conditions.

The Index anonymizes, aggregates, and compiles metrics every week in real-time and reports on changes via interactive charts, focusing on three core metrics.

Founder links created: the average number of pitch deck links each founder is creating on the DocSend platform, which serves as a proxy for supply of startups seeking funding. A "link" refers to the unique URL a founder creates with DocSend to share their pitch deck with investors. Each investor should get a unique presentation with the most pertinent and up-to-date information. When the average number of links increases, it means that founders are sending their decks out to more investors.
Investor deck interactions: the average number of investor interactions for each pitch deck link created by founders on the DocSend platform, which can serve as a proxy for demand for investments. The higher the interaction metric, the more often decks are being viewed, shared, and revisited by potential investors.
Investor time spent: the average time spent per pitch deck by potential investors. This metric offers a look at how long VCs are spending reviewing deals. More time spent per deck could mean investors are more closely scrutinizing deals.

About DocSend:
DocSend enables companies to share business-critical documents with ease and get real-time actionable feedback. With DocSend's security and control, startup founders, investors, executives, and business development professionals can build business partnerships that have a lasting impact. Over 16,000 customers of all sizes use DocSend today. Learn more at docsend.com.

Media Contact:
Laura Kubitz
104 West for DocSend
[email protected]

SOURCE DocSend