Twenty five percent product. Twenty five percent marketing. Twenty five percent operations. Twenty five percent legal and G&A. I have seen that pie chart in thousands of decks. It tells an investor how money will leave your bank account. It tells them nothing about what the money buys.
Investors do not fund budgets. They fund outcomes.
What the Investor Is Actually Asking
When an investor looks at your use of funds, the question in their head is not "is this allocation reasonable." It is: what will be true about this business in eighteen months that is not true today, and does that make the next round easier to raise than this one?
A budget cannot answer that. A budget is a plan for spending. What an investor needs is a plan for proving.
The Translation
Every category on that pie chart is an activity. Activities are how you spend the money. Outcomes are what the money produces. The work is moving one level up.
"Twenty five percent to sales" becomes "$40K MRR by Q3."
"Hire two engineers" becomes "the enterprise version shipped and running in three paying accounts by month nine."
"Expand marketing" becomes "a second acquisition channel producing 30% of new customers at a cost we can defend."
The hires and the spend do not disappear. They move underneath the milestone, where they belong. They are the line items that get you there. They are not the thing you are asking an investor to fund.
This is the practical, slide-level version of a bigger idea. If you want the framework behind it, the one investors are quietly scoring, that is Milestone Fit, the eighth of the 8 Fits.
The Sentence You Should Be Able to Say
Here is the test. Get on a call with an investor and say this out loud without flinching:
I need your $1M to achieve these four milestones over the next eighteen months, unlocking the business and positioning us for our seed round.
Then name the four. With numbers. With dates.
If you can do that, your use of funds slide is doing its job. If what comes out of your mouth is a list of departments and percentages, you have more work to do before that meeting.
Most founders have never been made to do this work. It is uncomfortable, because a percentage is easy to defend and a number with a date attached to it is a commitment. That discomfort is the point. The investor is going to hold you to something. Better that you choose it.
Frequently Asked Questions
What should a use of funds slide actually show?
Three to five business outcomes with specific numbers and dates, covering the 12 to 24 months the raise funds. Spending categories can appear beneath them as supporting detail, but the outcomes are the slide.
Do investors really not care about the budget breakdown?
They care that you are a responsible operator, and diligence will surface your spending plan. But the breakdown never wins the meeting. What the money produces is what gets underwritten.
How specific do the milestones need to be?
Specific enough to be wrong. A number and a date. "Grow revenue significantly" is not a milestone. "$40K MRR by September 30" is.
Where do the hires and spending go if not on the slide?
Underneath the milestones, as the line items that produce them. The two engineers you want to hire are how you ship the enterprise version to three paying accounts by month nine. The hire is the input. The outcome is what you put on the slide.
How is a use of funds slide different from a milestones slide?
Done right, they say the same thing from two angles. The milestones slide names what you will prove. The use of funds slide connects the money to those proofs. When both are outcome-based, they reinforce each other. When the use of funds slide reverts to a budget pie chart, it undercuts the milestones you just presented.
Can you say the sentence without flinching?
I run this exercise with every founder I work with, and it is usually the hardest ninety minutes of the engagement. It is also the one that changes the raise. The 8 Fits MRI is a free eight-minute diagnostic that shows you where the work is, starting with whether your raise has a plan or just a number.
Take the free MRI →