How investors evaluate startups: three criteria that change everything

At the TechCrunch Disrupt conference, a panel of experienced investors revealed unconventional standards for evaluating projects. For every founder dreaming of funding, this is an essential material to study. Three leading investors — Jyoti Bansal (founder turned investor), Medha Agarwal (Defy), and Jennifer Neundorfer (January Ventures) — shared their criteria without diplomatic politeness.

The trend of buzzwords is harmful: why investors hate empty rhetoric

The most annoying tactic in pitch decks is overusing trendy terms, especially the word “AI.” Agarwal gave a sharply worded piece of advice: the more often a founder mentions artificial intelligence, the less likely it is that the company actually uses it. True innovation is integrated naturally into the product and isn’t the main focus of the presentation.

This clearly distinguishes two categories: companies that genuinely solve problems using cutting-edge technology, and those trying to “sell” an idea based on popular words. Investors recognize this difference instantly.

The market must be large, and the founder — unique

Bansal outlined three key questions he looks for when evaluating a project. First: is this market big enough for the project to become a large company? It’s not just a “good idea,” but an idea with explosive growth potential.

Second, and most importantly for any investor: why should this particular founder build this project? Every team member must possess something unique: special skills, exceptional experience, or a specific network of contacts. In a crowded market, this is the only reason your project will beat competitors. As Bansal eloquently put it: if the problem is interesting, there will be two dozen other companies trying to solve it. Your competitive advantage is not the problem — it’s you.

No proof of work — no money: validation is required

The third criterion is tangible validation. Investors need concrete proof that your approach works. This could be initial feedback from real users, even minimal revenue, or any other market interest marker.

These three elements lead to the final test: can this company become a billion-dollar one? If the answer is yes, the investor will listen further.

AI startups in saturated niches: how to stand out

For AI-based developers, the panel shared special survival strategies. Expertise in a specific subject area becomes critically important. Neundorfer pointed out companies creating entirely new interaction models, rather than just optimizing existing processes.

Agarwal offered practical recommendations: clearly justify how your AI technology solves your product’s problem, formulate a clear market entry strategy, and demonstrate how your solution is more effective than existing alternatives.

It is also critically important to directly name your competitors and show why you lead. Candidates who tried to hide this lost investor trust immediately.

Navigating change: recommendations for founders

In the rapidly changing tech landscape, founders are advised to constantly follow industry trends and stay active in networks of like-minded individuals. Neundorfer emphasizes the value of communicating with other founders to exchange tools and valuable insights.

But perhaps the simplest and most important advice from Bansal is: focus on building your product. Ultimately, the product’s quality convinces investors better than any presentation.

TechCrunch Disrupt 2026 is scheduled for October 13-15 in San Francisco. Industry leaders from Google Cloud to Wayve will take the stage, along with hundreds of innovative startups reshaping global markets.