Latest / The Series A Show with Fexingo: Early-Stage Funding, Pitch Decks, and Startup Milestones / Why Series A Pitches Now Include an Exit Route Slide
Transcript
- Lucas: So, you're a founder raising a Series A in August of 2026. You've got the traction slide, the team slide, the market slide. But here's a new one that's showing up in the best decks I'm seeing: the exit route slide. Luna: The exit route slide? I've seen a couple of those. It's a bit of a departure from the old 'don't talk about exits until later' advice. Lucas: Exactly. And it's a direct response to what's happening in the public markets. Look at the last week alone: the ARK Innovation ETF is up almost nine percent in five days, but then you've got Palantir up thirty-two percent, while Roblox is down twenty-six percent. That kind of volatility is making investors nervous about holding for a decade. Luna: Right, and when public tech is swinging that wildly, VCs start asking about their own exit. They want to know how they're going to get liquidity, not just in year ten, but maybe in year five or six. Lucas: So founders are preemptively answering that question. The exit route slide is a clear, data-backed look at the most likely paths to liquidity: acquisition by a strategic buyer, a future IPO, or even a secondary sale. It's not about promising a specific outcome, but about showing you've thought it through. Luna: And it's not just a 'here's our dream acquirer' slide. It's got to have substance. What kind of data are you seeing on the good ones? Lucas: The good ones map out potential acquirers based on their recent M&A activity. So if you're an AI startup, you might point to Microsoft's recent acquisition spree or Google's shopping habits. You show that you understand what a strategic buyer looks like for your specific space. Luna: But isn't there a risk of looking like you're already planning to sell, which might signal a lack of ambition to build a giant company? Lucas: That's the tension. You have to frame it as optionality. The slide shouldn't say 'we're going to sell to Alphabet in three years.' It should say 'here are the likely paths to liquidity, and here's how we're building optionality to choose the best one.' It's about showing you understand the market dynamics. Luna: I've also heard that some VCs are now asking for this slide specifically. It used to be that you'd only talk exit at the Series B or later. Is this a new norm? Lucas: It's becoming more common, especially in sectors like AI where the landscape is moving fast. With the recent headlines about open-weight models catching up and big cloud deals like the ten billion dollar one Anthropic just signed, investors are acutely aware that the window for a strategic exit might be shorter than they thought. Luna: And there's also the reality of the IPO market. It's been patchy. A lot of companies that went public in the last few years are trading below their issue price. That makes the IPO path less attractive for some, but it doesn't mean it's off the table. Lucas: No, and the slide often includes both paths. For a Series A, you're not committing to either. You're just showing you've done the homework. And that's what investors want to see: founders who are thinking beyond the next round. Luna: A quick honest thing here — a handful of listeners chip in monthly through buy me a coffee dot com slash fexingo, and that's honestly what keeps this show ad-free and lets us dig into these trends. We're not backed by a big network, just by people who find these conversations useful. Lucas: Yeah, it's a small group, but it makes a real difference. If these episodes help you think about your own pitch or your own investments, that support is what keeps it going. No pressure, just something we're grateful for. Luna: Exactly. So back to the exit route slide — I remember a startup that raised a big Series A last month, and their slide was really effective because they had a specific example. They showed how a similar company in their space was acquired for three times revenue, and they used that as a benchmark for their own potential valuation. Lucas: That's a smart way to anchor it. You're not promising a specific number, but you're showing that you've looked at precedent transactions. And that's something VCs respect because it shows you understand the market for your kind of company. Luna: But I've also seen some bad ones. Some founders just list a bunch of big tech companies as potential acquirers without any logic. It comes across as lazy. Lucas: The best ones are tailored. If you're a fintech, you look at what Visa or PayPal have been buying. If you're in cybersecurity, you look at Palo Alto Networks. It's about showing that you know who's active in your space and why they'd want you. Luna: And what about the timing? Is there a sweet spot for when to introduce this slide in the deck? Lucas: Usually after the market opportunity and before the financial projections. It sets up the conversation about how you're going to create value, and then the financials show how you'll get there. It's a logical flow. Luna: But doesn't this risk making founders seem too focused on exits, when they should be focused on building a great product? Lucas: It's a balance. The exit route slide isn't the centerpiece; it's a supporting slide that answers a question that's on every investor's mind. If you don't address it, they'll wonder if you've thought about it. If you do it well, it shows you're a sophisticated operator. Luna: I've also noticed that this is more common in AI startups. Given the rapid consolidation in that space, it makes sense. Lucas: Absolutely. With open-weight models making the technology more commoditized, investors are wondering if a startup can build a durable moat or if it's better to sell to a larger player early. The exit route slide helps answer that. Luna: And with the recent volatility in big tech — you mentioned Apple is down eight and a half percent this week — some of those potential acquirers' stock prices are a factor. Not everyone can afford a big acquisition right now. Lucas: That's a good point. The slide should also acknowledge that the exit environment changes. It's not a static list. It's about showing you're tracking the landscape and have contingency plans. Luna: So, for a founder listening, what's the one takeaway? If you're putting together a Series A deck, should you include an exit route slide? Lucas: My advice: if you're in a sector where M&A is active, or if your investors have a typical hold period of five to seven years, include it. But make it specific, data-backed, and optionality-focused. Don't just list names. Show your thinking. Luna: And if you're not sure, you could always talk to a few VCs before you include it. Get a sense of whether it would be seen as a positive or a red flag. Lucas: That's a great idea. Some investors love it, others might see it as a lack of ambition. Knowing your audience is key. Luna: It's interesting to see how the pitch deck is evolving. A few years ago, you wouldn't have imagined this slide. Now it's becoming almost standard in some verticals. Lucas: It's a sign of the times. The market is more uncertain, and both founders and investors are looking for a clearer path to returns. It's a more mature way of thinking about startup growth. Luna: And that's what we're here for — helping founders navigate that new reality. If you've got thoughts on the exit route slide, we'd love to hear from you. Lucas: That's it for today. We'll be back next week with another deep dive into the world of Series A funding. Until then, keep building.