A Black founder used this unusual pitch deck to raise $17 million from Ashton Kutcher, Sean ‘Diddy’ Combs, and the CEO of Qualtrics
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- AI startup Forethought has two pitch decks: one for traditional venture capitalists, and another for Black celebrity investors. That’s because founder Deon Nicholas has a unique story to tell them, he says.
- In the weeks after George Floyd’s killing, Nicholas set out to bring Black investors onto his cap table. He focused his pitch on his personal story as a young computer geek who became a rare Black founder.
- The message to Black celebrities, Nicholas said, was that they should invest in Forethought because it’s “going to be a category-defining business,” and also, their support of “a Black founder will mean something to a lot of people.”
- We’re sharing the pitch deck that Nicholas used to raise $17 million with his permission.
- Visit Business Insider’s homepage for more stories.
On a warm day in May, Deon Nicholas was walking with his young family around their neighborhood on the San Francisco Peninsula. The 27-year-old startup founder was in good spirits. He had gotten an investment offer from a venture capitalist five days earlier, bringing an end to an anxiety-inducing week of back-to-back pitch meetings.
Nicholas told his wife the good news and they continued their walk, passing the local high school. It was graduation day, and cars filled with triumphant teenagers lined up outside the school for a socially distanced procession.
A police escort passed by, and his wife turned the conversation from fundraising to George Floyd, a Black man in Minneapolis who was killed by a police officer. It was his wife’s turn to fill him in; Nicholas hadn’t been following the news with his focus on the fundraise.
The joy he felt after receiving the investment officer faded and was replaced with anguish. After they got home, he spent the rest of the afternoon watching videos of Floyd’s killing and reading about the protests.
“I was not OK,” Nicholas said.
The startup founder asked himself what he could do in response.
His day job doesn’t necessarily lend itself to social activism. His startup, Forethought, builds tools powered by artificial intelligence to allow workers to automate routine tasks, starting with a customer service chatbot.
But he thought about how rare it is to be a Black founder. Growing up in a poor part of Toronto, he could not have imagined this life for himself when he was learning to code from his older brother’s friend, the only person “to tell me that it was cool to go into computers,” Nicholas said. And so, he wanted to inspire other Black kids to succeed.
‘What if the next Bill Gates is Black?’
The national conversation around race led him to rethink his fundraising strategy.
In the weeks that followed, he went back to meeting potential investors, but this time, he sought out Black icons from the entertainment business, where his investor Ashton Kutcher had connections. The company created a new pitch deck focused on telling his personal story as a young computer geek who became a rare Black founder.
One slide reads “Change the face of tech,” alongside a photo of a smiling young Black girl. The next slide shows a photo of him busy coding at a startup competition next to an image of a twenty-something Bill Gates.
The message to Black celebrities, Nicholas said, was that they should invest in Forethought because it’s “going to be a category-defining business,” and also, their support of “a Black founder will mean something to a lot of people.”
Nicholas said he wasn’t always sure about putting himself at the center of his pitch. “If I stand out, I want to be standing out because I’m a successful enterprise entrepreneur,” not because of his Black identity, he said.
After talking with friends, family, and his executive coach, he came to the conclusion that, “having the attention on me is in service to everyone’s goals,” Nicholas said. “So I had to make that conscious decision that this is going to be just as much about my story as it is about Forethought — and for the sake of this pitch, the two are intertwined.”
A win-win-win scenario
The second pass at fundraising created a win-win-win, according to Nicholas: Forethought raised even more money. The company’s future success spreads wealth to Black investors. And the world gains a role model for Black and brown children who are interested in careers in tech but don’t see people who look like them running big companies.
“I am a builder, and this might actually be a way that I can make a change in the world,” Nicholas said.
In total, Forethought raised $17 million in a Series B round from Kutcher and Guy Oseary’s Sound Ventures, NEA, Operator Collective, and others, alongside Sean “Diddy” Combs, LL Cool J, and Qualtrics CEO Ryan Smith.
The deal came together entirely over videoconferencing during the pandemic, Nicholas said.
In a press release, actor and Grammy Award-winning artist LL Cool J said he was impressed by the founder’s track record.
“My decision to invest in this company is driven by my belief in this business,” he wrote, “but I certainly also hope it helps to raise awareness of the kinds of contributions young Black entrepreneurs are making in technology as well.”
Forethought’s business is booming
The company’s chatbot, Agatha, uses machine learning and natural-language processing to answer support tickets, patch customers through to a human if needed, and give agents the power of Google autocomplete at the help desk. The startup said it’s closed more than 500,000 support tickets for customers like Carta, Gusto, and Thumbtack.
Tools that use artificial intelligence — once relegated to academic studies and science fiction — are being deployed in every industry, and they’re drawing tech investors in droves. Insiders say the the coronavirus pandemic has even sped up the adoption of these technologies as businesses, grappling with remote workforces and shrinking budgets, look for ways to run their operations more efficiently, Business Insider’s Benjamin Pimentel and Paayal Zaveri write.
The crisis created new business for Forethought. Businesses that sent their customer support agents home, where they didn’t have access to their usual tools, turned to AI to help them be more effective, Nicholas said. And some customers saw the volume of customer support issues increase as much as 5X as their customers faced uncertainty.
This year, Forethought’s staff tripled to 48 people, as other startups had to cut jobs in order to stretch their budgets.
Now look at the startup’s unusual pitch deck
Nicholas shared with us the pitch deck he used to convince Black celebrities to become investors.
It’s different from most investor decks because it has little text and no charts showing the state of the business.
Instead, Nicholas focused his presentation on the opportunity to back a Black founder building a multibillion-dollar enterprise. His success would matter to the next generation of tech leaders, a class that looks different from the last.