The pitch deck that helped a sexual-wellness startup raise $5.4 million
This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now.
- Mitch Orkis and Hunter Morris are the cofounders of LA-based sexual-wellness brand Cake.
- The brand targets a gender-fluid Gen Z and saw 470% quarter-over-quarter growth in 2021.
- Here’s the pitch deck they used to raise $5.4 million from VC firms like Lerer Hippeau.
Entrepreneurs Mitch Orkis and Hunter Morris decided to shake up the sexual-wellness market when they launched Cake in September 2019. The Californian cofounders felt that the sex industry had become outdated. “We didn’t have a brand that spoke to either of us,” Orkis told Insider.
The duo, who met at a digital-branding company, wanted to create a one-stop destination for fun sex — from condoms and lubricant to sex toys and prescription products.
Morris said he raised $185,000 from family and friends to help them bootstrap the burgeoning brand. In June 2020, they launched Cake’s first product: the pandemic-appropriate So-Low Lotion, a masturbation buy available on their website.
The tongue-in-cheek brand that targets a more gender-fluid, Gen Z audience experienced 470% quarter-over-quarter growth during 2021. But when the pandemic first hit, it looked as if their grand plans for the next sexual revolution might grind to a halt. Not only did they have to close their day-old office, Orkis said, but social-media giants threatened to switch off the accounts that the Gen Z brand used to reach its customers. The compliance flags they received requested that adult content focus on facts rather than pleasure.
“I remember standing on the street, talking to Hunter, and I said I don’t know how to market a company that we legally can’t market,” Orkis said. But the entrepreneurs quickly circumvented this by collaborating with the social-media companies to define what those rules are. Since then, they’ve worked on large projects with Hulu and Snapchat.
Morris and Orkis sought funding on two occasions and only when they had a specific goal in mind, Orkis said. In February 2020, they raised $1.435 million to launch their first line of products and employ three full-time staff members. And in January 2021, they raised a further $4 million in funding from investors such as VC firm Lerer Hippeau to help them fulfill a nationwide order for Walmart. They’re now about to enter the prescription market. While further funding isn’t on their radar right now, Orkis said, it could be in the future.
Orkis walked Insider through the pitch deck they used to close both rounds of funding.
The Cake team wanted to show immediately that they were different from their competitors. “The way people have sex and get down today is quite a bit different than in 1904 when K-Y Jelly was launched,” Orkis said. “The tagline ‘Let’s get weird’ is letting investors know that this is a different type of sexual health and wellness company.”
Orkis and Hunter wanted to show investors they were at the front of the next sexual revolution. They did this by choosing a font that gave a nod to the 1970s. “The biggest sexual revolution happened during the 1970s when people were open and embracing new things. We wanted to harken back to that era, but give it a modern twist of today,” Orkis said.
The duo wanted to show investors there was an untapped market. “This generation is the most sexually fluid and open than ever before,” Orkis said. “There’s a giant cultural shift happening and the current brands are missing it, and it’s going to cost them.”
The cofounders wanted to show how they believed the competition was losing touch with its clients. “Their sites are not nice for mobile, their packaging is out of date, they’ve lost touch with their consumers,” Orkis said.
Orkis and Morris used this slide to show how the sexual-wellness market was being left behind by other industries. “A lot of other categories have focused on what goes into people’s bodies and on to their skin. Sex has yet to do that in a mainstream way,” Orkis said. “We want to be the first brand that treats sex care like skincare, and that’s helped us get into the big retailers across America rather quickly.”
The entrepreneurs then used this slide to demonstrate how confusing the market is. “People would look left and right, grab something off the shelf, and run. And oftentimes they don’t know what’s the best product to buy,” Orkis said.
Orkis said the competition had websites you might feel uncomfortable about being spotted reading. “We want to make you feel that any time you come to Cake you feel positive, happy, not embarrassed about buying products for your sexual health,” Orkis said.
Orkis and Morris used this slide to underline what they’d discussed so far. “It’s helpful when you’re creating an investor deck to continually clarify your point,” Orkis said. “This is the summary of everything that came before and about Cake becoming the most approachable sexual and wellness brand on Earth.”
The entrepreneurs then show with slides eight and nine how it’s helped customers cut through the noise with clear color-coding on products. “Creating a system that’s so easy to understand has been the secret sauce to Cake,” Orkis said.
Cake has sought funding twice. But each time they’ve been clear with investors about why they’re raising funds and how the money will be spent. “We don’t believe in raising a giant round in a ridiculous valuation. We don’t think that sets up anyone for success,” Orkis said.
Orkis and Morris wanted to show how nimble being digitally native makes the brand. “We drop products, we give them away for free, we get feedback, and that helps us refine our products and stay relevant to our consumers,” Orkis said.
The cofounders reveal the results of a survey they commissioned to show how the audience is changing. “There’s a huge shift happening, where people are coloring outside of the societal norms. No one is addressing that on a mainstream level,” Orkis said.
Orkis and Morris showed how TikTok keeps them connected to their customers. “It’s helpful to have that two-way dialogue. Gen Z tells us exactly what they want, and we can then build products that deliver against their needs,” Orkis said.
The cofounders showed how they collaborated with social-media brands to make sure that as a brand in the sex sphere they weren’t shut out of the site. “We collaborated with each platform to define what their rules are, and we’re now starting to shift those rules,” Orkis said.
This slide showed potential investors how Cake forecasts trends. The team’s ability to track data not only enables the company to meet the needs of their clients but also target future markets.
With this slide, the founders talk about how they’ve broken down barriers. “We’re the first brand to have a men’s masturbation cream on the shelves of Walmart nationally in the US,” Orkis said.
This slide is designed to give investors the “wow” factor. “Cake is more than just a lubricant. We have all these products in this market and plan to own it,” Orkis said.
In this slide, Orkis and Morris let their customers do the talking. “Once people learn, know, and try cake, they’re ridiculously brand loyal,” Orkis said.
The cofounders chose graphics over photographs as they wanted to keep the brand elevated. “At the time when we were trying to build the pitch deck, there wasn’t any imagery that felt on brand,” Orkis said. “When it comes to the images that we found, I think tacky is an understatement.” Since then, the brand has shot its own images.
From finance publications to Gen Z websites, Orkis shows how it has a wide appeal. “There have been few brands that have been able to take on sex in a mass way,” Orkis said.
The slide deck ends with a link to Cake’s website. “We wanted to be able to show that they’re not investing in a pipe dream — they are investing in a real company,” Orkis said.