A must-read for crypto founders: Venture capitalists care not only about your project, but more importantly, about you

Original Title: "The 'Intangible' Game: How VCs See You"

Author: Omri Drory

Compiled by: Deep Tide TechFlow

You just finished a presentation and feel like you did exceptionally well. You feel good.

As you exit Zoom or leave the meeting room, you might wonder: what are the investors thinking at this moment?

Let’s unveil this mystery. The investors you just presented to exchanged glances for a moment. In that instant, there was an indescribable atmosphere. This atmosphere usually develops into one of two scenarios:

Scenario 1: Full of enthusiasm, unstoppable. We can’t wait to start due diligence and are even ready to call our partners to recommend your case to them.

Scenario 2: A quiet atmosphere, everyone just shrugs and looks at each other, a gut feeling rising up—this might not be what we want.

We strive for option 1; that energetic feeling makes us love this job and willing to listen to countless pitches. Unfortunately, this situation is not common. If your pitch falls into the atmosphere of option 2, it will be very difficult to turn things around and enter the state of option 1.

The importance of first impressions is far beyond what people imagine.

Worse still, if you belong to "Scenario 2," most venture capitalists won’t even tell you the real reason. The worst VCs will stall, waiting to see if other "top VCs" will make a decision first while giving you the runaround.

We once wrote about the core focus points in our investment decisions. The hardest feedback to articulate is not about the uniqueness of the technology or the market potential, but about the founder themselves.

Sometimes, the reason investors don’t invest is you, more precisely, their impression of you.

Even in the biotech field, where science and intellectual property are key elements, this phenomenon still exists. In the software field, this phenomenon is even more pronounced, as transformation is almost inevitable.

Seed funding is essentially an investment in people. Investors need to be convinced that you are the one who can take the seed round all the way to a successful exit. This feedback is the hardest to accept because it seems impossible to improve.

I write this article because I believe that if you can see the big picture, you have the opportunity to take action. Even if you have excellent technology and a sufficiently large market, if you are unaware that many VCs expect to see certain "intangible qualities" in a presentation, it will be a huge regret.

Best Case Scenario

When investors feel excited about a founder, they often describe that person with one word: "compelling."

This is a very critical word.

Of course, this is of no help to you. After all, how could you possibly know what qualities a VC finds attractive?

When most VCs find someone attractive, they mean: I must invest in this person—this is an indescribable feeling that we only know when we see and feel it.

A fitting analogy might be the so-called "intangibles" in football. When evaluating potential NFL quarterbacks, scouts typically score based on specific metrics like accuracy, footwork, and strength, but there’s also an intangible quality that can’t be measured by data. This "intangible quality" is an instinctual judgment about whether the scout believes someone is a natural winner. This feeling is familiar to us… just like when Tom Brady or Patrick Mahomes are trailing in the last minutes of a game, we have a certainty in our hearts: they will lead the team to a comeback victory.

Once you succeed, everyone will say you had that ability from the start. But the real key is how to make others believe you have that potential when you are just starting out.

While no one can draw a perfectly accurate "founder traits" blueprint, the following elements may come close to the answer.

Trait 1: You have unwavering perseverance

Starting a company is a worthy endeavor, but most of the time, it is not easy.

To summarize a founder's work in one sentence: silently endure hardships.

Your health may be affected.

Your close relationships may be strained.

You will feel endless "fear of missing out" (FOMO) and "imposter syndrome"—why are others raising funds, hiring, and growing while you are stuck in place?

Half the time, you will feel like you have no idea what you are doing.

You will face some predictable difficulties and encounter completely unexpected challenges.

When I was a CEO, during those toughest moments, I would feel a "deathly tightness" deep within.

Please read these words again and think about your current life. Perhaps you are pursuing a postdoc or have a stable job at Google or OpenAI, with a generous salary, a clear career path, and widely recognized social status.

Even so, do you still want to start a company?

Many first-time founders start without truly understanding what entrepreneurship means. Jensen Huang, the founder of NVIDIA, recently stated that if he could do it again, he might not choose to start a company.

Once you start a company, you will think more carefully about whether to venture into entrepreneurship again—this is why second-time founders usually only embark on a new journey when they have a truly special idea.

For second-time founders, the biggest risk is "rich exit syndrome." When things get tough, they might think: if I don’t need to do this anymore, why should I put myself through this pain?

Successful entrepreneurs often possess a special "charisma" that convinces investors they are strong enough to endure the various hardships of entrepreneurship. Therefore, before you decide to pitch to venture capitalists (VCs), take a look in the mirror and ask yourself: do I really want to go down this path?

If you can truly understand this, then convincing yourself to start a business should be more difficult than convincing investors. But if you are fully determined, your investors will certainly feel it.

When you deeply desire to do this, that determination will naturally show. This leads us to the second point…

Trait 2: You have an undeniable determination

Most outstanding founders start companies not because they "want" to, but because they "must." This is an inner impulse, not a rational choice.

The term "wantrapreneur" exists to describe this opposite. Wantrapreneurs are those who choose to start a business because they think it looks glamorous.

This inner impulse will manifest in your daily habits and emotions. You will find that even during "breaks," you are thinking about the details of your startup. Your browser history may be filled with searches related to your company. Your friends and family may start to find you annoying (see above about silently enduring hardships). You will be trapped in the "idea maze" and even live in the future—those future visions are almost as real to you as the present.

When I started my first company, Genome Compiler, I had this experience. At that time, I was a postdoc at Stanford, as biology was gradually moving towards digitization. The thought of staying in academia and doing pipetting experiments made me feel like I was about to collapse. I had to be part of driving the future of synthetic biology, and I had an idea to help achieve that goal.

Later, a postdoc from the neighboring lab actually quit to start a company—that was when I first realized that entrepreneurship was something I could truly pursue. From that moment on, I knew I had to do it.

The best founders can see the possibilities of the future. They feel anxious when reality does not match the beautiful vision of the future in their minds. In their minds, they have already constructed a path—perhaps several paths—leading to that future.

That’s why I like to say that entrepreneurship is like a "wormhole" to different realities. You must follow that wormhole to the future you create for yourself and others.

If your desire for something is so strong, you will know it, and your investors will feel it too.

Trait 3: You genuinely care about others and the mission

Most founders have heard of "founder-market fit," which refers to whether your expertise and skills align with the market you are in. But I believe there is a deeper layer: you not only understand this market, but you also genuinely care about it.

Some people can perform well in a job they don’t care about, which is unfortunate but true. However, if you want to start a company, you cannot be that kind of person. You must deeply understand and care about the "why" behind what you are doing. This is particularly evident in the life sciences, where we often see people driven to enter the field to cure diseases affecting their family or friends.

If you truly care, you will be willing to put in the extra effort to surpass your competitors. You will discern what constitutes a true breakthrough versus what is merely incremental improvement. And frankly, if you really care, you will find it interesting.

This is actually the first step in building a company with competitive barriers. If you care more than others, you will defeat them.

Naval Ravikant once said: By being your authentic self, you can stand out from the competition.

But on this point, many people often lie to themselves or to investors. Perhaps you can convince yourself (and your investors) that you care about something for a few years. But in a 7 to 10-year relationship with venture capitalists, you cannot keep up the facade.

This obsession does not fade over time. You can accept that your company occupies 100% of your attention because… it has taken up all your mental space.

Don’t "fake it until you make it"—instead, become the person who deserves to succeed.

Trait 4: You are the core of the team

One of the keys to attracting venture capitalists is to demonstrate that you can be an excellent leader. We need to feel that you are the one we must invest in. We want to confidently recommend you to other investors and feel proud to connect with your company.

This appeal is very subjective and difficult to define clearly in a manual. But I believe this intangible quality stems from a deep and multifaceted capability. You can not only grasp the big picture but also pay attention to details, showcasing a comprehensive ability.

You can manage the overall situation well. You can view your pitch from a macro perspective, strategically plan fundraising, develop business plans, maintain company operations, and drive product development.

You can also handle details effectively. If someone emails you, you can respond quickly, providing deep insights while being comprehensive in details without getting bogged down in minutiae.

If you can do both, it not only shows you have grand visions but also proves you possess practical execution capabilities.

It’s like the "quarterback" in a football game. The quarterback is the core figure of the team; they need to know where the ball should go and have the ability to deliver it accurately at critical moments—even with just seconds left to score.

Intangible Qualities:

• Trait 1: You have unwavering perseverance.

• Trait 2: You have an undeniable determination.

• Trait 3: You genuinely care about others and the mission.

• Trait 4: You are the "core quarterback" of the team (symbolizing leadership and overall control).

Showcase yourself, not just your company

If you have clear goals, an excellent team, and outstanding technology… you will be surprised to find that raising funds is not as difficult as you might think. But if you overlook your core role in this story, you may encounter many obstacles.

Many founders do not realize that in a pitch meeting, you are not just pitching the company; you are also showcasing yourself.

If you face repeated rejections— the problem may not lie in your idea, but in the investors' perception of you. This feedback is often hard to accept, so usually, no one will tell you directly. Moreover, not every investor's judgment is necessarily correct. Different investors will have different views of you. You cannot please everyone, but that’s okay. Find the investors that suit you, and keep pushing forward.

But if you can take some time to reassess from a different perspective, it’s really just about viewing your pitch process in a whole new way.

Possess those intangible qualities, become that indispensable person. Then show us these qualities and make us believe that you are the best candidate.