Flash Feedback Episode VI: Napkin Finance (2021)

Hi, I’m Larry Cheng, co-founder and managing partner of Volition Capital, and I’m excited to be with you again for another episode of Flash Feedback. Where we look at real pitch decks from real companies and I try and give you an insider’s view on how an investor like myself might be looking at that deck and what they’re perceiving. Hopefully, we’ll give you a few tidbits on things that are going well and a few ideas on how to improve the deck and hopefully, that will help you with your own projects as you develop them for your companies. Today, we’re going to look at the pitch deck for a company called Napkin Finance, they’re a financial content company and it looks like their goal is to simplify the explanation of financial concepts for the broad base of consumers out there. So, let’s dive right into the pitch deck. I’ll cover it in a few short minutes and then I’ll come back at the end to provide some feedback on what I liked and what could be improved. So, let’s dive in right now. Okay, here we are with a Napkin Finance pitch deck we’re going to fly through this, and I’ll come back at the end with a few thoughts. So, here’s the opening page. I love the name of a company, by the way. I like that they start with some graphics of their content, so let’s dive in. The first slide is really a background, a personal background of the founder, which I think is a compelling way to start.

What drove you to start this business? And it’s because she’s a visual thinker who wanted to learn about finance in a different way. So here is this quick snapshot on some high-level data points about the company. Visual Learning, bootstrapped, million in recurring revenue, best-selling book. That’s kind of the snapshot of the company. It’s a content company that is off the ground and running. Next slide, talking about some validation of that content. They’ve been recognized in The New York Times, Washington Post, Boston Globe for one of their opening books, which is Build Your Wealth in 30 seconds or Less, which in and of itself is a very interesting title. So, I’m already interested because this is a unique company, unique concept and they’re validating their content early here. Firstly, they’re talking about traction, traction in terms of B2B partnerships for their content. I see UBS and Chase US banks. Large financial institutions are adopting this content, being a channel for it. It sounds like 80 million households have access to it. So, channel validation as well. Very interesting. The engagement through those channels is strong: eighty percent view rate, thirty x longer engagement on this site, great click through rates, great retention rates. So, they’re building here. They’re saying we have unique content, easy to use. It’s visual, it’s being adopted both by channel partners, it’s being endorsed by major publications and the consumers themselves are engaging with it.

So, it’s a great start to the pitch deck and they have a mission to give back and various concepts where they can teach others about financial concepts as well. So very well-rounded start right out of the gates. This is where I think it’s a little bit of a weaker side, they talk about macro trends and financial planning. There’s seven topics here. It’s hard to know which one really matters. I would rather there be one trend that’s driving the whole business or one or two. Maybe there are seven, but maybe this can be simplified a bit. The opportunity here is there is a millennial to Gen Z problem. As you switch these demographics, there’s just lack of access to quality financial advice, lack of access to sort of AI data driven financial planning. So, it sounds like they’re trying to play on a sort of a generational shift and how the content around finance has not stuck with that. So, their solution is they’re more content oriented, visual learning and goals based planning. So, I don’t really know what this means, so I think there could be some clarity here. But sounds like they’re proposing that their content is the right solution for the problem. Their target audience, they would say, it sounds like, is about forty-seven million people, younger demographic and sort of a median income of seventy thousand dollars that they’re saying over the next couple of decades will control a significant amount of spend.

So visual content focused on the younger demographic. And this is different than traditional advisors because they have data machine learning, they have communities and so forth. So, there is more digital orientation. It’s not clear to me at this point what this data machine learning aspect is about and they have an AI orientation which is not clear to me what that’s about. But it sounds like there is a strong digital orientation and visual orientation to the business. They compare themselves to sort of traditional advisors, robo-advisors and they talk about a number of areas where they’re stronger. This is the proverbial slide that we do more than these others. It’s a little bit hard as a small startup company to say we do more than Morgan Stanley so I don’t know if this is the strongest slide, but it does try and paint the picture that they’re more A.I. driven. All right. Business model, it sounds like free, free, free. They’re saying everyone wants to be free. And there’s big businesses that have been built on free. And obviously, the question is, how do you make money if you’re free? The answer seems to be that they give their content for free and then they are the generation model for third parties, both products and services. Then they take a cut of that conversion so lead generation business at its core. Their go to market plan is going to expand over time, which makes sense.

And here are the two founders, Tina and Greg. And I believe that is the last slide. Great overall deck. And let’s provide some thoughts and feedback as we go. So that’s the Napkin Finance pitch deck. Let me provide some feedback, both in terms of areas I really liked about it and areas to improve, a few areas to consider that I really liked. Number one, for a visual content company, the visual design of their deck is really strong. It’s clear. It’s beautiful. I think you would expect that for the type of business they’re in. So A+ on the visual design of the deck, very strong. Number two, I love that they start with the authentic story of the founder. I always want to know why did the founder start this business? What is driving them? Why is this their passion? Are they in it for the long haul? And explaining that in the very opening slide, I think is a strong way to start the pitch deck. So, start with the founders story. Start with the why. Thirdly, I think the way they explained their content right out of the gate is very strong. They said this is our content and this is why it’s distinctive. Then they came with this is who’s validated New York Times, Washington Post and others. Then they said, here are the channels that are the channels for our content, which again is another form of validation.

And then they came with here’s how consumers are engaging with the content, which is well above the engagement of other financial content types. So it’s almost like a one, two, three, four punch to say our content is special, our content is working and I came away from that sequence of slides really believing that so super strong start. Those would be three of my high-level thoughts on the positives. Three areas to improve and again I think the deck is overall quite strong. Don’t just explain the product, show the product, let it speak for itself. I really wanted to see more of the product. I was so intrigued by all the validation that the product was receiving that I actually wanted to see it. So maybe take an example of how Napkin Finance explains the financial concept and let me see it and let me be wowed by it. I think that could be really compelling. Number two, don’t just explain the monetization, prove it. So, they explained the monetization platform as lead generation and commissions. I know what that means in concept, but I don’t know what that means in terms of hard numbers. So, it would have been nice to see, for example, if they distributed the content through this channel, how did they monetize that channel? How much revenue did they generate through it? How many leads did they generate through it? So, I could actually internalize from a pure financial standpoint and the actual numbers of a channel partnership, what that means from a revenue perspective.

So don’t just explain the monetization. Proving monetization will be my second point. And then lastly, give one powerful use case to bring it all home. What I mean here use case is take a piece of content that you’re proud of. Show me the content so I can see it. Show me the content in the channel partner that distributed it. Show me the engagement through that channel partner, and then show me how much revenue you generate through that partnership and that end-to-end use case. Let me believe that that is going to happen one hundred thousand million times over and that’s how I’m going to believe that’s a big company. So those are my three ideas for Napkin Finance overall, very strong deck for a young company. I think they did a great job. Once again, if you would like to see more flash feedback stories, we will be posting them on this YouTube channel. And if you would like to submit your pitch deck for consideration and for feedback, please go to volitioncapital.com. And we have a flash feedback page for you to do that. Thanks again to Napkin Finance for their partnership on this episode and we’re grateful for all of you. Thanks so much, take care.