Why this matters
Everything you claim in a pitch gets checked in diligence. Numbers that don't reconcile re-price deals, kill them late, or, at the extreme, become fraud claims. Getting them straight now, before you build the investor list, is far cheaper than explaining them later.
What "done" looks like
- Bookings, revenue, and cash are tracked as three different things
- Gross margin includes the real cost of delivering the product
- You know monthly burn and runway cold
- Every headline metric reconciles to your accounting and bank statements
- You can answer "how is that calculated?" for any number in the deck
How to do it
- Separate bookings, revenue, and cash. Investors will, so do it first.
- Compute true gross margin, hosting, payment fees, support, and delivery costs included.
- Nail burn and runway to the month, from actuals, not intentions.
- Reconcile to the bank: QuickBooks or Xero tied to statements, with clean monthly closes.
- Define each metric once, MRR, churn, CAC, and use the same definition in deck, data room, and conversation.
- Write the "how it's calculated" note for anything an investor could question.
Common mistakes
- Quoting an annualized run-rate from your single best month as "revenue"
- Stuffing MRR with one-time or heavily discounted deals
- A deck that disagrees with the data room, the fastest way to lose trust
Real-world examples
- JPMorgan's $175M acquisition of the startup Frank unraveled when its claimed user numbers proved fabricated, and the founder was convicted of fraud, the extreme end of "investors will check."
- Standard diligence reconciles claimed revenue against bank statements and accounting exports; discrepancies routinely re-price or end deals.
From a founder's point of view
Numbers a stranger can verify are an asset; numbers that need a story are a liability. Clean books say more about how a company is run than the pitch does, and they compound, because every future raise starts from this one's diligence file.
Rule of thumb
Every number in your pitch should survive being checked against your bank account by a skeptical stranger.
