I am a college senior at MIT, starting a startup with my classmate who is also a senior. We have been working on this for about a month and have built some software that is still far from a marketable product. But is useful for our first customer (B2B, so there about ~20 people using the software at that customer), which is offset by the fact that we have heavily customized for their needs in a way that we couldn't afford to do at scale.
Describing the specific idea would dox me, but here is some metadata. We're building the sort of thing that could be described, cynically, as an "llm wrapper" or "b2b saas" product. We have a theory about why this specific product will become more valuable as intelligence becomes cheaper (over a couple more OOM of model improvement, all bets are off in an ASI / takeoff scenario). But this is still firmly a software product. LLMs are pretty core to why it would be a good idea (it would be impossible without them), but we are doing software engineering and not any sort of research or deep-tech.
It's a B2B product for an industry I've worked in before (that's how we got first customer) and think I understand better than most people in tech.
I want to avoid our startup failing. This is so early that the most likely path is to fail before we even get off the ground. Specifically, conditioning on this "failing," I think the most likely explanation is something like the following.
I chose to keep my high-paid quant role (which I have already signed) after graduating, which kills the project since we stop working on it full time.
I do this because I was demotivated about our ability to make our thing succeed, enough that the pretty-good quant option seemed better than continuing to fumble around.
I was demotivated mainly because we lacked any external validation from VCs for our thing being worth trying
I felt bad about this at first, though I think it's honest. But I actually think it's reasonable, since getting VCs excited about our thing is kind of necessary to eventually succeed, so their lack of excitement would indicate in the most charitable case that we sucked at this core skill of fundraising and failed to improve at it for months. Which would be good reason to be pessimistic.
Making this concrete, I would translate "lacked external validation from VCs" to "failed to raise over 100k" (on any terms / from any VCs).
I will try to answer any questions about our situation as best I can in a way that doesn't dox me. I'm spending a lot of money for me on making this market because I want to get good information to guide my decisions over the next few months, so I'm very interested in giving people the best context I can so they can bet rationally.
Update 2026-03-03 (PST) (AI summary of creator comment): Resolution will be based on the creator's subjective judgment after careful deliberation and discussion with others involved in the startup.
The creator acknowledges they cannot objectively distinguish between all answer options (e.g., "VCs disliked us as people" vs "not impressive enough as founders")
VCs will not fill out surveys to determine the cause
The creator will make their best guess based on available evidence, discussions with involved parties, and any feedback from VCs (though VC feedback is often unreliable)
Bettors are explicitly betting on what the creator will believe the cause was, not necessarily on objective reality
Update 2026-03-04 (PST) (AI summary of creator comment): "Not having a sufficient track record of success" will resolve under the answer "We were not impressive enough as potential founders, regardless of the idea"
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@Cactus I'd resolve this under "We were not impressive enough as potential founders, regardless of the idea"
How will you determine the resolution for some of these? Like, even in failure scenarios, how are you going to distinguish between "we actively made VCs dislike us as people" vs "We were not as impressive enough as potential founders"? Are the VCs gonna fill out a survey?
We're not betting on objective reality here - we're betting on how you will resolve this. If you're convinced you made VCs dislike you, that's who gets paid out regardless of what the VCs claim. So knowing what will convince you is important.
@DannyqnOht You're right, and I can't think of a way to avoid that problem in a market like this. The VCs won't fill out a survey and it's hard to know why any particular VC turned you down.
If this resolves, I think I'll have a pretty good guess, out of these options, as to what the main cause was. I'll think through this as carefully as I can, and discuss with other people involved to try to come up with the most accurate diagnosis.
I may be overconfident in my ability to figure this out, but I think that at least between some of these, I will almost certainly be able to resolve correctly after lots of deliberation and discussion. In the case of "we actively made VCs dislike us" there would be plenty of evidence of this, which we would be less likely to see in the case of "we didn’t have an impressive enough demo."
People do sometimes share why they pass on a deal, and this usually can't be trusted. But there are some especially honest people in this industry who may tell us earnestly where they think we went wrong.
But at the end of the day, yes, you're betting on what I think the cause was. Bets of the form "I think it will fail for x reason, but they'll think it's for y reason, so I'll bet y" are totally acceptable, and I encourage people to make them if they think that's the right strategy.