This is the proof in the pudding moment. How have you proved that you are a worthy investment opportunity? Do you have users? Revenues? Have you hired stellar talent? Do you have impressive names on your Advisory Board? We’re talking measurable things that they can actually track. Mark Suster goes on to say that: “Everyone has their own definition of momentum (user numbers, revenue, channel partners, biz dev deals, whatever). But the reality is that this nebulous term people talk about that they “need to see traction” really just means that they’re not ready to invest in your company. Why? Chances are they don’t know you well enough and can’t judge your performance or capabilities…So that’s why I tell all entrepreneurs that if you want to raise money from VCs you should see them early. If I see your alpha product then I can judge how it develops over time. If you have 2 developers and the next time I see you it’s a team of 6 with a new head of products I can see momentum. If you have beta customers, new pricing plans, different positioning, more market insights, good press coverage — whatever — these are all signs that the ball is moving forward. And it is that momentum that is easier to judge than a single data point.”
