Butterfree is pretty bad. Sure, it can learn sleep powder, and compoundeyes makes it more accurate. However, Butterfree will probably not get a chance to use these moves because it is very slow and will die in one hit from almost anything. Plus, butterfree isn't psychic; it's bug/flying, one of the worst type combos EVER. If you want a pokemon similar to Butterfree, there are a ton of better choices. I'll give you a few, and you can pick one of them instead
Scyther
Held Item: Focus Band
Slash
Wing Attack
Swords Dance
Reversal
Scyther hits faster and harder than Butterfree, plain and simple. Sword Dance if you get the chance, and watch your opponent's team crumble to the ground. With any luck, focus band will stop scyther from dying, and then Reversal has a whopping 150 base power, which mean it can kill almost anything in one hit. One of my favorite pokemon. You can later evolve it into Scizor, but Scyther is a better attacker and has more speed while Scizor can take more hits.
Exeggutor
Held Item: Miracleberry
Giga Drain
Psychic
Explosion
Sleep Powder/Synthesis/Moonlight
Exeggutor uses the same basic attacking strategy as Butterfree, but is better at it. The last move is up to preference, but I like Sleep powder for the pure annoyance factor. Explode when you're about to die anyways. I like this pokemon for your team because it means you don't need to use Victreebel/Weepinbel, as Exeggutor takes care of Weepinbel's type coverage. The only downside to Exeggutor is that he has more weaknesses than Butterfree (seven in all). However, unlike Butterfree, he has reliable recovery methods and enough defense to take a hit.
Gengar
Held Item: Miracleberry
Thunderbolt/Fire Punch
Ice Punch
Confuse Ray
Psychic/Explosion
I love Gengar because he is totally unpredictable. Depending on your moves, he can have super effective damage on almost any of pokemon. He is weak defensively, but he is fast enough and strong enough to kill most things in one hit, especially if it's super effective. Explode when you're about to die.
And, if you decide to go with Butterfree, here's a moveset, but good luck at keeping it alive long enough to attack...
Butterfree
Held Item: Quick Claw
Psychic
Sleep Powder
Giga Drain
Nightmare/Stun Spore
If you can get it to sleep on the first turn, you can kill it with nightmare before it wakes up with any luck. then, psychic away and hope you don't die. Quick Claw is to give Butterfree some hope at surviving one turn.
Hope that helps!
P.S. Butterfree does not, in fact, evolve into Dodrio as some people would like you to believe.