Key Takeaways
- A use of funds slide states the raise amount, the runway it buys, the spending categories, and the milestones reached before the next round
- Investors judge the slide on milestones, not line items: what will be true about the company when the money runs low
- Y Combinator's guide suggests sizing a seed round to fund 12 to 18 months of operation and reach the next fundable milestone
- Four to six spending categories is enough; hiring is usually the largest because people are most of an early-stage budget
- Show what changes if you raise less, a practice SEC Item 504 requires in registered offerings when not all securities may be sold
- In a Regulation Crowdfunding offering, use of proceeds is a mandatory disclosure under 17 CFR 227.201(i), not a slide choice
- Every number on the slide should tie back to the financial model, because diligence will check that it does
A use of funds slide tells investors how much you are raising, how many months it funds, where the money goes by category, and which milestones it reaches before you need to raise again. The milestones are the point. The spending breakdown exists to prove the milestones are affordable, and the runway figure proves you have left a buffer to raise the next round.
The slide usually sits near the end of the deck, next to the ask. It is short. It is also one of the slides where a partner decides whether the founder has a plan or a wish. This guide covers what belongs on it, how to size the raise from the bottom up, how to handle a range, and the mistakes that make investors stop trusting the numbers.
What is a use of funds slide?
It is the slide that connects the amount you are asking for to the outcomes it buys, usually shown as a raise amount, a runway in months, a category breakdown, and a short milestone list.
Not every deck framework gives it its own section. Sequoia's guide to writing a business plan runs from company purpose through problem, solution, why now, market, competition, business model, team, financials and vision, with no separate use of funds heading. In practice, most seed and Series A decks include one anyway, because the first question after "how much are you raising?" is "what do you do with it?"
A complete slide has four elements:
If the slide has only a pie chart of percentages, it is missing the two parts investors care about most.
How do you calculate how much to raise from the use of funds?
Work from the bottom up: pick the milestone, estimate the months needed to reach it plus a buffer, then multiply the monthly cost of the team and operations you need over that period.
Y Combinator's guide to seed fundraising frames it this way. Decide how many months of operation to fund, usually 12 to 18, and the amount follows. The same guide says the goal is to raise enough to reach the next "fundable" milestone, usually 12 to 18 months out, and gives a rule of thumb of about $15,000 per engineer per month, all-in, for early Silicon Valley startups.
An illustrative calculation, not a real company:
The total is your raise. If the bottom-up number lands far from the amount you planned to ask for, trust the bottom-up number and change the ask, or change the milestone.
The runway number on the slide should come from the same model as your burn rate. Our burn rate and runway guide covers how to calculate both, and AI financial modeling builds the monthly projection the slide draws from.
What categories should a use of funds slide include?
Use four to six categories that match how you will actually spend, with hiring usually the largest at seed stage.
Typical categories, and what each should signal:
Show amounts or percentages, not both, unless space allows. Avoid a category called "other" or "working capital" above a small share of the total; investors read a large unexplained bucket as an unplanned one.
How do you tie use of funds to milestones?
List the three to five outcomes the round buys, each stated as a measurable fact an investor at the next round would check.
The milestone list is what turns a budget into an investment case. The test for each line is whether a Series A or seed investor could verify it in diligence 15 months from now.
Weak and strong versions of the same milestone:
Pick milestones that match what the next round's investors require. If you are raising a seed round to get to a Series A, our guide to Series A metrics investors require lists what those investors look for. Each milestone should map to a spending category: if "three ramped reps" is a milestone, sales hiring must be in the budget for long enough to ramp them.
What should the slide say if you raise less than your target?
Show the minimum raise that still reaches a meaningful milestone, and state what you would cut or delay to get there.
Founders often give a range, such as $1.5 million to $2.5 million. A range without a plan for each end looks like uncertainty. A range with a plan looks like discipline.
Public company disclosure rules offer a useful model. Item 504 of SEC Regulation S-K requires a registrant to state the principal purposes and approximate amounts for the net proceeds of a registered offering. Where less than all the securities may be sold, the instructions require the order of priority of those purposes and a discussion of the plan if substantially less than the maximum is raised. That rule does not govern a private seed deck, but the logic transfers directly:
YC's guide makes the same point from the founder side: give several versions of runway and amount based on different growth scenarios.
Does a use of funds slide create legal obligations?
In a private SAFE or priced round it is usually a projection rather than a covenant, but in a Regulation Crowdfunding offering use of proceeds is a required disclosure, and anything you tell investors must not be misleading.
Three situations differ:
If plans change after the close, tell your investors in the next update. Changing direction is normal. Hiding it is what damages the relationship.
What mistakes make investors distrust a use of funds slide?
The common failures are numbers that do not tie to the model, runway with no buffer, and milestones that cannot be measured.
Get the slide and the model reviewed together. AI deck review checks whether the ask, runway and milestones are consistent with the rest of the deck, and our guide on how much equity to give up in a seed round covers the dilution side of the same decision.
Check your ask before investors do
GIGABOOST's AI deck review tests whether your raise, runway and milestones hold together, then matches you with investors from 340,000+ verified profiles, scored on 25 fit factors.Frequently Asked Questions
What should a use of funds slide include?
It should include the amount you are raising, the runway in months that amount buys, four to six spending categories with amounts or percentages, and three to five measurable milestones reached before the money runs low. The milestones are the most important part. A pie chart of percentages alone is incomplete.
How many months of runway should a seed round fund?
Y Combinator's guide to seed fundraising suggests funding 12 to 18 months of operation, enough to reach the next fundable milestone. Many founders add a buffer of a few months beyond the milestone, because raising the next round takes time and milestones slip. The right number depends on how long your specific milestone takes to reach.
Should I show percentages or dollar amounts on a use of funds slide?
Either works, as long as the slide also states the total raise so investors can convert one to the other. Dollar amounts are clearer for small categories that matter, such as regulatory costs. Keep detailed line items in the financial model rather than on the slide.
Is the use of funds slide legally binding?
In a typical private SAFE round it is a statement of plans rather than a contractual covenant, though priced-round agreements vary. In a Regulation Crowdfunding offering, use of proceeds is a required disclosure under 17 CFR 227.201(i). In any offering, statements to investors must not be misleading under antifraud rules.
What if I raise less than my target amount?
Show investors a minimum case: the smallest raise that still reaches your most important milestone, and what you would cut or delay to get there. A range with a plan for each end reads as discipline, while a range without one reads as uncertainty. Then say what an oversubscription would add.
Where does the use of funds slide go in a pitch deck?
It usually sits near the end, alongside or just after the ask and the financials slide. Some founders combine the ask and use of funds into one slide. What matters more than position is that the numbers match the financial model and the milestones match what next-round investors require.