The Flaw in VC Vetting Most Miss (Hint: It's Not the TAM)

The venture capital world runs on identifying the next big thing. Billions are poured into promising startups, yet the stark reality remains: a significant majority fail to deliver on their potential. We see endless pitch decks, analyze market sizes (TAM), scrutinize team bios, and track early traction. But what if this traditional vetting process, despite its rigor, is fundamentally flawed? What if it’s focusing on lagging indicators and surface-level signals, rather than the core reason a startup might succeed or fail?

Current vetting often gets caught up in the founder's vision or the solution's features, neglecting the most critical element: the customer's underlying need. This post argues that the traditional process is broken because it doesn’t adequately assess whether a startup truly understands and effectively solves a real, important customer Job-to-be-Done (JTBD).

Jobs-to-be-Done theory offers a more reliable lens. It shifts the focus from the what (the product) to the why (t…