How to Become a Featured Slide in an Investor's Next Fund Deck

Founders who understand how VCs raise money have a major fundraising advantage.

Introduction

Every founder knows the pressure of fundraising: perfecting your deck, highlighting traction, casting a bold vision. But what if I told you that VCs go through a nearly identical process? While you’re pitching them, they’re pitching someone else, Limited Partners (LPs), the institutions and individuals who provide the capital VCs invest.

These LPs include pension funds, university endowments, fund-of-funds, family offices, and high-net-worth individuals. And just as you’re judged on product-market fit and revenue growth, VCs are judged on how effectively they pick and support breakout companies.

Understanding how VCs raise money gives you insight into how they evaluate you. So let’s flip the script, here’s what founders can learn by looking at how VCs pitch their own investors.

Who They Pitch: The VC’s Audience

When a VC is raising a new fund, they’re not knocking on founder doors; they're sitting across from LPs managing billions in capital. These LPs aren’t looking for a hot product or flashy demo. They want fund managers with discipline, access, and repeatability.

In early-stage funds especially, LPs often include high-net-worth individuals and family offices who expect direct communication, smart fund construction, and a clear investment edge. So while you're analyzing whether a VC is a good fit for you, they're doing the same with their investors and it's shaping how they think about your round.

LPs commit hundreds of thousands, sometimes millions or even billions, of dollars based on a fund’s ability to:

• Generate consistent high returns

• Access proprietary deal flow

• Manage risk across a portfolio
  

VCs segment LPs much like startups segment users. High-net-worth individuals, family offices, fund-of-funds, and endowments each have unique goals. Early-stage funds often rely on more agile, direct-relationship LPs like angel investors or micro-institutionals, while later funds pitch to larger, slower-moving capital sources.

Understanding which type of LP a VC is working with can help you read their behavior during your own fundraising process.

VCs as Storytellers: Pitching Strategy, Not Just Vision

Unlike a startup, which typically pitches a single product and go-to-market plan, VCs pitch a strategy: a repeatable, scalable way to identify and grow the next wave of high-growth companies. They’re selling their judgment, network, and process.

While startups pitch a product, VCs pitch a repeatable investment thesis. They’re not asking LPs to bet on a single startup, they’re selling a system to find and support dozens (or several dozens) of startups.

That strategy could be:

• Sector-specific: e.g., B2B SaaS, AgTech, climate tech, fintech, logistics, etc.

• Stage-focused: e.g., pre-seed, seed, Series A

• Geo-targeted: focusing on specific cities, countries, or regions

• Demographic-based: backing underrepresented founders or operator-led ventures

VCs are listening for more than just a compelling startup with a nice slide deck, they’re asking whether they can champion your story to LPs. They’ll ask themselves more than “Does this founder stand out?” and “How big can it get?” Investors are also thinking “Does this fit our thesis?” and “How does it fit within our current portfolio?”

Track Record: Everything is Measured

VCs lead with performance. If you’re wondering why a VC might hesitate despite liking you personally, or even love your solution, it’s often because they’re thinking about how your startup’s potential fits into their return profile. A good founder doesn’t take it personally, they use that insight to better target the right investors at the right time.

Just as startups emphasize traction, team strength, and revenue growth, VCs lead with past fund performance. LPs want to know: have you done this before, and did it work? Metrics like IRR (Internal Rate of Return), TVPI (Total Value to Paid-In), and DPI (Distributed to Paid-In) matter more than personality or vision.

LPs care about results. VCs, especially when raising follow-on funds, are judged on a few key performance metrics:

Metric	What It Means
IRR (Internal Rate of Return)	Measures how fast value is created
TVPI (Total Value to Paid-In)	Measures the total return potential of a fund
DPI (Distributed to Paid-In)	Measures actual cash returns given to LPs

There are a lot of other variables that go into the decisions on why some VCs might pass on promising founders. 

Pitch Materials: Data Rooms and Deal Flow

Founders pour time into pitch decks and metrics. VCs also compile pitch decks, but for funds. Instead of demoing a product, they outline sourcing strategies, return potential, and past wins. Here's how the founder and VC pitch processes mirror each other:

Founder Pitch	VC Fund Pitch
Product deck	Fund deck
Business traction	Portfolio performance
Vision and roadmap	Investment thesis and deployment plan
Data room	Due diligence package

What’s powerful here is the mirroring: the same way you build a story around your company’s growth and potential, a VC wants to point to proof around their ability to identify companies like yours. Help them connect those dots. If they can envision how you grow, return capital, and help them raise their next fund, your deal becomes a lot more attractive.

Understanding this parallel gives you a mental model. Helping a VC imagine how you will fit into their narrative and, in turn, into the pitch they’ll tell LPs often goes a long way in getting to the next stage in the investment process. 

Key Selling Points: The VC’s “Unfair Advantage”

When VCs sit down with LPs, they need to articulate why they are going to outperform the average fund. That might come from proprietary deal flow, deep sector expertise, or operational chops. LPs want to know: what edge do you have that others don’t? Similar to founders pitching investors, VCs must answer one critical LP question: “Why you?”

This typically comes down to their unfair advantage:

• Proprietary deal flow (e.g., top accelerator access, network of founders)

• Niche expertise (e.g., deep climate science or MedTech expertise)

• Exits as a founder, operating experience, or network

As a founder, you should be doing the same. When a VC sees you understand the importance of defensibility and strategic edge, it resonates on both sides of the table.

Sound familiar? It should. Founders talk about moat, defensibility, and founder-market fit. VCs are doing the same thing, but one level up. The more clearly you show that you represent a top-decile bet, the more you’ll resonate with VCs who need those stories to build credibility with their LPs.

Capital Use: What VCs Are Balancing Behind the Scenes

When you raise, you’re focused on fueling one business. VCs raise to manage a portfolio, allocating capital across dozens of bets with reserves for follow-ons and mechanisms for risk mitigation. LPs care about strategy, pacing, capital allocation, and loss ratios.

That framework shapes how VCs evaluate you. They’re not just asking, “Is this exciting?” but “Does this fit our capital plan? Can it generate a meaningful return without throwing off our portfolio balance?” Understanding this can help you size your round correctly and avoid terms that unintentionally take you out of scope.

To stay aligned with LP expectations, VCs must stick to a defined allocation model that includes:

• Initial check sizes

• Follow-on reserves

• Fund diversification

• Loss rate management

This affects how they evaluate your deal. A VC might pass not because they don’t believe in your company, but because your round doesn’t fit their allocation strategy or reserve budget.

Time Horizon and Fund Lifecycle Management

VC funds run on a 10+ year lifecycle. LPs commit money expecting to wait years for liquidity but they want clear signals of momentum and progress along the way. For VCs, that means pacing investments carefully and ensuring some exits or markups appear before the next fundraise.

Your exit timeline matters in this equation. If your company is positioned for a 12-year journey, but a VC needs liquidity in 6, you may hit a structural misalignment. 

Most VC funds operate on a 10-year cycle:

1. Years 1-4: Active investing

2. Years 4-7: Portfolio support and markups

3. Years 7-10: Liquidity events and winding down

If a VC is early in their cycle, they might be more aggressive. Late-cycle VCs want faster exits. Understanding where a fund is in its lifecycle can help you frame your pitch more effectively and know when to wait or engage.

Valuations & Ownership Outcomes: Return Multiples Matter Most

As a founder, it’s natural to focus on valuation and dilution. But to a VC, the primary question is: “Can this investment return 10x our money, or more?” LPs expect VCs to hit targets across a portfolio, not in a single deal.

Startups often fixate on valuation but VCs look at ownership and return multiples. A VC needs to believe your company can return 10x their investment to justify writing the check. That’s a major consideration when investors evaluate round valuations. A VC doesn’t need 51% of your company, but they do need a clear path to meaningful upside. If the cap table is crowded or the round terms make it hard to get 10–20% early, they might pass even if they believe in your business.

If your cap table is crowded or the valuation is too high for the stage, they may pass on the round, even if they believe in you, your product, and the mission.

Success Metrics: What LPs Track

The way LPs judge fund performance is critical to understanding VC behavior. IRR measures how fast the value is being created. TVPI and DPI measure how much value has been created or distributed. Paper markups help with future fundraising but DPI (real distributions) is what gets LPs to get into the next fund.

Everything a VC does, from portfolio construction to founder selection, is ultimately aimed at maximizing their fund metrics. Strong follow-on rounds matter because they signal growth and de-risk the fund.

Here’s what matters most to LPs:

• DPI for actual cash

• IRR for speed

• TVPI for paper value

• Number of exits

• Fund concentration (how many companies drive returns)

This is why VCs often care so much about your next round. A strong Series A not only de-risks your company, but it boosts their fund metrics. Your up round is their validation. Understanding this can help you better time your raise and position momentum. Founders who understand these metrics can better position their own success stories to VCs.

Timing and Fund Cycles: When VCs Are Likely to Invest

Here’s the kicker, VCs are on a clock to deploy capital. Most raise a new fund every 2–4 years. That means they’re constantly thinking about fund performance, portfolio support, and capital reserves.

Just like market timing matters to startups, fund timing matters to VCs. They’re most active:

• Right after closing a new fund: Fresh capital = faster deals

• Before raising their next fund: Looking for signal-boosting wins

• Post-markup events: LP interest is peaking

If they’re early in a fund cycle, they may be quicker to take risks. If they’re in between funds, they might be more conservative. If they’re nearing the end of a fund, they’ll prioritize deals with shorter time-to-liquidity. Knowing where they are in their own lifecycle helps you understand their behavior and close stronger.

By researching where a VC likely is in their cycle, you can understand their urgency and tailor your pitch timing.

Lessons for Founders: Aligning with VC Needs

If there’s one actionable insight from understanding how VCs pitch LPs, it’s this: great founders don’t only tell a compelling story about their startup, they give VCs something they can confidently showcase to LPs. 

• Fit their thesis: Use their language

• Back into their metrics: Show your return potential

• Create LP narrative: Be the example they showcase

This isn’t manipulation, it’s strategic empathy. You're offering them a narrative they can take upstream to their own investors as evidence that they’re the kind of fund who gets into winners early.

Here’s how founders can apply this insight in practical ways:

Fit Their Thesis: Speak Their Language

Every VC has a thesis. It might center on industry (e.g. fintech, climate, B2B SaaS), stage (pre-seed vs Series A), geography, or founder profile. When you approach a VC, you’re not being evaluated solely on merit, but also on fit.

Study how they describe their fund and portfolio. Do they emphasize “founder-market fit”? “Massive TAM”? “Capital efficiency”? Mirror that language when appropriate in your pitch. If they believe in network effects or AI-native infrastructure, show how you embody that. Help them check the boxes they’re already optimizing for.

Back Into Their Metrics: Show Your Return Potential

VCs ultimately need you to help them return their fund, ideally with a 10x or greater outcome. That doesn’t mean you should lead your pitch with valuation spreadsheets. But it does mean you should be able to tell a believable path to your company becoming a $100M+ business and how their investment grows significantly in value along the way.

Founders who can articulate a clear path to a fund-returning outcome, including multiple exit scenarios and likely timelines, earn a deeper level of investor confidence. VCs are thinking in terms of ownership, dilution, follow-on risk, and return multiples. Show that you understand that lens.

Create the LP Narrative: Be the Example They Showcase

VCs rely on a handful of portfolio stories when raising future funds. These are the startups they bring up on stage at conferences, highlight in LP updates, and reference in new fund decks. These stories don’t always have to be unicorns; they can be founders who execute fast, raise smart follow-ons, win competitive deals, or break into new markets.

When you pitch, think: How do I become one of those examples? If you can show that you have momentum, clarity of execution, and a strategic plan that aligns with the VC’s identity, you give them something powerful, a win they can champion internally and externally.

Conclusion: Be the Slide in Their Next Fund Deck

Understanding how VCs raise money unlocks a key insight: they need great founders just as much as you need great capital. But their constraints, metrics, and decision-making frameworks are often invisible unless you look upstream.

Great founders don’t simply tell their story, they understand their audience’s story. By seeing fundraising from the VC’s perspective, you gain clarity, confidence, and an advantage.

Founders who execute with clarity, momentum, and scale don’t just secure funding they become the slide. The one VCs showcase to LPs as proof they back the right people early.

Because in venture, your story isn’t just what gets funded, it’s what gets retold.

Founder Toolkit: Key Questions to Ask VCs

After meeting with an investment group they’ll often give you a chance to ask some questions about their fund. Here’s what to ask when doing due diligence on a VC:

1. What are your typical next steps and when can I expect to hear back on your decision?

2. What’s your fund size and typical check range?

3. How many more deals do you plan to make from this fund?

4. What percent ownership do you typically target?

5. Do you have reserves for follow-ons?

6. How do you support portfolio companies post-investment?

These questions help you align expectations and avoid surprises. A word of warning, do your homework before the call. If you ask questions that are easily found on the funds website, in their blog, or on social media you can quickly identify yourself as a founder that doesn’t do research and instead follows a script. This is not the type of entrepreneur that most investors are looking for when making investment decisions. 

FAQs About How VCs Pitch Their Investors

1. Who are the typical LPs in a VC fund? LPs include pension funds, endowments, family offices, and high-net-worth individuals.

2. What metrics do LPs use to judge VC performance?IRR (speed), TVPI (paper value), DPI (real distributions), number of exits, and concentration of returns.

3. How often do VCs raise new funds? Typically every 2–4 years, depending on performance and capital pacing.

4. Why do VCs care so much about ownership percentage? To ensure their investment has a high enough upside to impact overall fund returns.

5. What is a VC fund lifecycle? A 10-year cycle that includes investment, support, and exit phases.

6. How can founders use this knowledge in their pitch? By positioning themselves as a key part of a VC’s fund narrative and return strategy.