the 5 signals preseed vcs look for in founders and how to market them

Turn your messy life story into the #1 reason investors say yes

Hey everybody, welcome to PMF 🔥

Today I want to share some of the learnings that I’ve reflected from my last year investing as an angel.

I think learning this as a founder is a great tool to be smarter at fundraising.

Early stage investing is all about signals. Since the company is still super early, there’s no way to know if it will grow or will die soon.

For most investors,
being the first one to commit money is something they will never do,
unless there are very strong signals of:

1. The founder going to close the round

2. The founder going to grow the company 100% sure

Obviously, both things are impossible to know for sure, so what are the signals investors look for that?

1. VCs are looking for stories that signal the founder has drive, resilience, aptitude, even traumas that make the founder an outlier

VCs are people, customers are people and founders are people. The most important thing is for founders to connect or resonate with investors. For that, founders need to craft their personal story.

Harry Stebbings says that he always starts his founder interviews sharing something sensitive about his life so the founders open up.

This can be how you are an inmigrant child and struggled adapting, how your family struggled with money at any point, how you faced a big challenge in university etc.

Many of the most successful founders share these stories because having dealt with being poor or some of these traumas later can become a great driver to keep pushing hard.

I’ve seen this personally in my life (my father passed away when I was 25 and I had to take care of a dying company, went bankrupt with no money and had a huge struggle.

That experience marked me hugely and gave me a drive to grow and conquer that I don’t think I’ll ever lose) and so I have an eye to find it in other founders.

2. Signals of previous successes:

Together with the point before, some founders forget to share how they’ve been outliers previously in life.

This is exactly the kind of thing investors are looking for. They want to know that you’re a bit “off the curve” – that you have some special abilities or track record that makes it more believable you’ll win.

For example, I recently talked to a founder who only told me after I invested that his co-founder was one of the youngest game developers in Sweden. At 12 years old, he was running a gaming server that was one of the most used in the country. At 12.

That’s crazy and it’s a huge signal.

Someone who can do that at 12 clearly has a high level of technical ability and a strong intuition for what people want. It shows they can build something that gets in front of a lot of users.

Those are exactly the kinds of stories you want to surface when you pitch: specific, concrete examples of how you’ve already operated like an outlier.

Other, more “mainstream” signals investors look for are things like:

• Having worked at a big tech company

• Being an early or first employee at a fast growing startup

Investors usually see that as a positive signal because it means you have been exposed to:

• A fast growth environment

• Real tech culture

• How high performing startups actually operate day to day

They assume you have absorbed good habits, standards and mental models from that ecosystem.

But the strength of that signal depends a lot on two things:

1. Which company it was (FAANG vs random Series A nobody has heard of).

2. What you actually did there (founding engineer or product lead vs random intern that shipped nothing).

So if you have this type of background, do not just drop the company logo.

Explain your role, the context and what you actually learned or shipped there. That is what turns a generic CV line into a real signal.

3. You need to be “in the club”

caption...

Investors also look for market signals to validate their trust in you.

Not just who you are, but what the market is telling them about you.

There are some obvious market signals: revenue, growth, retention, waitlists, etc. But the non obvious are that you need to be in the club.

What this means in practice is that most of the best founders already know the most interesting people in the ecosystem.

And if they don’t at the beginning, they tend to build those relationships very fast.

Investors are trying to avoid looking stupid. They want to feel that if they back you, other smart people would have done the same. So they look for signals that you are “one of them”:

• Location as a signal

  You are more “in the club” if you are in San Francisco than if you are trying to raise from Madrid, for example. Being in one of the main tech hubs is a shortcut signal that you are close to talent, capital and the right culture.

• Tier 1 founders on your cap table

  Having well known founders as angels in your company is a powerful signal. It tells investors that people who have already won in the game are willing to bet on you.

• Audience and social proof

  It sounds a bit dumb, but it is real: having a following on social media counts as a market signal. If other people trust you, consume your content and pay attention to you, investors assume you are doing something right.

• Quality of your network and intros

  Warm intros from respected investors, operators or founders are also market signals. If the right people are willing to lend you their reputation, that reduces perceived risk a lot.

• YC, etc (if you come from an incubator that’s not YC or the other top 3 better don’t mention it)

All of these together tell an investor:

“This person is not random. They are already moving inside the right circles, and other smart people are validating them.”

4. Hot Market (but never force it)

Investors know that market pull is one of the strongest drivers of a company’s growth.

They are only going to back companies that operate in markets where demand is clearly growing, where it is obvious that the wave is getting bigger every month.

You want it to be easy for an investor to see that:

• The market is already moving

• Demand is accelerating

• You are building in the right direction of travel

For example, there was a clear wave around prediction markets. That trend now feels a bit “done” because there are already a couple of big winners, but it would have been a great place to be a few years ago.

Same with AI over the last three to four years. That has been the macro market. The key now is not “AI” in general, but finding a specific market inside AI that is still growing very fast and where you are well positioned.

5. Founder–market fit

Investors want to back founders who have some kind of edge or built-in advantage in the space they are attacking. It should feel obvious why you are the one who should be building this.

It usually looks like this:

• A long-time CFO building a company in the finance or accounting space

• A former growth lead building a marketing automation product

• A former doctor or researcher building in healthtech

What makes less sense is a career CFO suddenly building a pure marketing tool with no prior history in that world. There is no clear edge there.

So as a founder, you need to spell out your inside advantage right away:

Why this market, why now, and why you have a better chance than almost anyone else to win in it.

---

Use your storytelling as leverage: I’ll help you 1o1

I’ve decided to help some founders craft their story and build the signal, so I opened up some consulting slots this week.

I will work to create a better storytelling for you that attracts customers & investors and help you understand what are your strong points.

Here is what we will do together:

1. You pitch me
   You give me your raw story as if I were an investor or a customer. No polish needed

2. I find your real edge
   I work with you to surface the parts of your journey that actually create signal
   – why you, why now, and why this market.
   
   I will ask you the questions I would think as an investor and will work to build up you storytelling and your founder brand

3. I’ll turn it into a one pager you can share
   
   I’ll turn your story into your founder identity you can use to 100x your leverage
   

   • attracts investors and customers

   • makes your strengths obvious

   • you can reuse in decks, emails, and intros

PS: If your story is strong, I may also feature it on my channels to give you extra visibility, like I did here .

Hope this was valuable!

Cheers,

Guillermo