Helping investors suspend disbelief

J Matthew Pryor

J Matthew Pryor / January 18, 2022

2 min read––– views

It is tempting to describe founders in terms of selling a vision of things that don't exist - raising money on ideas.

The process is far more subtle than that. What you're selling is a version of the future that doesn't yet exist, but is plausible, achievable - one that can be brought into existence. What you are doing is helping to suspend disbelief - just long enough to generate more evidence - to show it is more plausible - more deliverable.

A poor trailing indicator

Early-stage founders usually don't have a product or sales, so they have to provide other pathways to belief.

It is understandable that investors want to see traction, sales, growth in daily active users, etc. But early-stage companies, especially startups in agtech, can't provide that because they don't have it. In their case, revenue is often a poor trailing indicator of great product-market fit. So what can you show instead?

If you believe what I believe

Just because customers can't give you money doesn't mean they aren't convinced by your value proposition. Money is a resource, and paying for something is a sure sign of belief. But there are others. If a vision is compelling, and the problem drives significant economic impact, then other resources can show belief. Your job is to get prospective customers to show their belief through the commitment of resources. This can take the form of:

  • Customers that share the vision and can describe how the product will help them in specific ways

  • Changes to other aspects of customer's business in anticipation of the product being available

  • Investment in significant infrastructure to maximize the benefit when the product is available

Do you see what I see?

If you are right, and the world will change in the way you predict, then new evidence will emerge, and the point of the funding is to build those parts of the product that will generate that data and further build belief.

All you are doing is suspending disbelief, so be specific about the future you're selling and how you can prove you're getting there