Hour One’s $20 Million Deck • businessroundups.org

Over the yearshas Mike Butcher covered Hour one a number of times here on businessroundups.org. The company uses AI to create text-to-video solutions with realistic-looking human avatars. Space seems to explode and Hour One has quite a trajectory. The company raised $5 million in 2020, taking on the language learning business and raising another $20 million in a round that closed in April this year.

I’m pretty excited to take a closer look at the deck that Hour One used to raise its most recent round, so let’s dive right in!

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Slides into this deck

Hour One raised its $20 million round with a tight 11-slide deck. The company has fully shared its deck, dated November 2021, with no edits or redactions, so we can see what the investors saw when they reached for their checkbooks.

1. Cover slide
2. “At a Glance” Summary Slide.
3. Solution slide
4. Market size slide
5. Value proposition slide
6. Product slide 1
7. Product slide 2
8. Target audience slide
9. Case Study Slide
10. Team slide
11. Closing slide

Three things to love

I like a card game that can distill its story down to the essentials. Most of the decks I see these days, both through my consulting practice and the pitches submitted to businessroundups.org, are much longer than the 11 slides Hour One used here. The question is…have they gone too far into sparseness? Let’s find out!

I love the “at a glance” approach!

Let’s admit it: one of the main reasons startup founders need a deck in the first place is to help potential investors figure out if they want to meet with you. Having an overview slide can help investors figure out if you’re in the right vertical and business stage – in other words, you can help them decide if you fit their investment proposition. This slide does some of those things right.

Leading with traction (characters and videos produced), clients, and funding history, along with a screenshot showing how the interface works, this slide goes a long way toward setting the stage. Personally, I would have added a few extra points:

• A one-line summary of what the company does (“Human-like AI character videos at the click of a button” might work.)
• Make the business model (B2B SaaS) explicit.
• Explicitly state how much money you are raising (“Raise $20 Million Series A”).

The lesson here is to include all relevant information about your business in one place, as early as possible in the story.

Excellent product overview

Aside from the great pun in the name of the product, this slide is chock full of really good content and provides a really clear summary of the product complexity that Hour One has already built through a simple, user-centered narrative. To make this slide even better, I would have preferred the story to be benefit-based rather than feature-based, but it does a lot of heavy lifting as it is.

The reason why benefit-based product stories work better is obvious: you help the investor connect the dots. It’s not about what the user can do, but why they could do these things to save time, money, and frustration. Here’s what that might have looked like:

• No code required -> “Anyone can create AI character videos.”
• Voices and Languages ​​-> “Connect with your audience in their language.”
• Characters -> “Embrace diversity by choosing from over 100 presenters.”
• Data Entry -> “Customized content in an instant by simply fetching data from external sources.”

By the way, I’m confused about this slide: on the summary slide, we’re talking about 150+ characters, and on this slide, it’s 100 presenters. Are presenters and characters different? If so, how? And if not, why are the numbers different? I suppose the founders could talk more about this as they pitch the story, but it would have been better if it was clearer as to why there is a difference here.

A variety of audiences

The very best companies create a product that works well for a particular audience, then expand the user base to gain a larger market share. Hour One tells that part of the story on the eighth slide:

What really works about this slide is that Hour One is able to show the breadth of its appeal; any of these categories could be big enough to build a successful business, but being vertically agnostic, Hour One can build a little fear of missing out (FOMO) in me as an investor: I can easily see how the company is on an extraordinary growth trajectory.

Apparently I’m in a nitpicky mood today, and as good and clear as this slide is, I think it would be even better if they combined the target customers with their results. Imagine how much stronger this part of the presentation would have been had the company used actual case studies for each of these categories.

Here’s what that could look like:

• E-commerce companies: +15% average basket value.
• Real estate: +19% of applications.
• Language learning: +40% vocabulary retention.

Obviously I’m making up the numbers here, but as a founder, these are the kind of slides where you can really show how deep your market knowledge is. Another approach could be to make it more benefit oriented by connecting the customers to the use cases. “Ecommerce uses Hour One to connect with customers” and “CFOs use Hour One to bring their financial reports to life.”

Combine them for a gold star for even deeper stories: “Company X uses Hour One to create its internal training programs, resulting in a 35% increase in completion of new training initiatives.”

As a startup founder, what you can learn from this slide is to always look for ways you can demonstrate the depth of your knowledge, both in terms of domain expertise and market context. If you deeply understand your customers and that your product solves real problems for them, it is an indication that there is something special about you and your team; being uniquely positioned to solve a problem becomes part of your “moat” – the reason no one else could do what you do.

In the rest of this teardown, we take a look at three things that Hour One could have improved or done differently, along with the full pitch deck!