Is your pre-seed startup solving a real problem? How to validate problem-market fit for VCs

Fundraising at pre-seed stage isn’t just about having a brilliant idea; founders need to pull together all the right elements to show that they are building a scalable, sustainable business. One of the first elements they need to get right is problem-market fit.

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According to an analysis of 100 failed startups by CB Insights, 42% failed because there was no market need. In other words, nearly half of these ventures were solving problems that did not matter enough to enough people.

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Source: Statista‍

What is problem-market fit?

Problem-market fit is the bridge between what you are building and your audience's needs. To put it simply: are you trying to solve a real problem - and is it widespread, frequent and important enough to support the growth of your startup?

Ivan Nikkhoo, ​​founder of Navigate Ventures, and principal at N3 Capital, speaks to around 25 founders a week, many of whom have already raised some level of venture investment and can articulate their product proposition in great detail.

And yet when Nikkhoo asks what specific problem they’re solving, the vast majority struggle to give a coherent answer. “They’ve fallen in love with an idea, built a solution, and are now searching for a problem to fit their product,” he explains. “It’s a topsy-turvy way of thinking that’s unlikely to deliver a positive outcome.”

It’s a classic case of innovator’s confirmation bias. This confirmation bias can often lead founders to dodge the big scary questions that might show up the cracks in their idea. So how can founders validate problem-market fit at an early stage in the life of their startup?

How can you validate problem-market fit at pre-seed stage?

Many pre-seed founders need to raise when their business is pre-revenue, pre-users or even pre-product. With limited or no commercial traction, the burden to prove you're addressing a real problem is elevated. There's no one-size-fits-all solution to this predicament: some founders rely on personal experience of the problem; others utilise market research data and statistics.

But what if you would like to present some on-the-ground evidence that your target customers have the big problem you think they do? There is something founders can do to validate this: talk to them. It sounds deceptively simple - but problem validation is very different from pitching or selling, and it can be challenging for founders to make the switch. So let's have a look at two popular approaches to customer research interviews which are designed (respectively) to validate and profile customer problems.

Problem validation interviews: The Mom Test

If you are trying to validate problem-market fit by talking to your (potential) customers, particularly at the idea stage, you need to be on the lookout for false positives: well-intentioned people saying they love your startup idea – or even that they’ll definitely sign up – but never becoming users or customers. It's tempting to bask in the warm glow of positive feedback, but it it may turn out to be a mirage.

The Mom Test by Robert Fitzpatrick is designed to cut through the noise in this situation. It helps founders to ask questions that will show you if your startup doesn’t have problem-market fit, even if your interviewee is doing their best to avoid hurting your feelings (and even if your interviewee is your own mother - hence the title).

​​Principle: Don’t pitch - never ask someone if your idea is good. In fact, don’t even talk about your idea. Instead, ask about their life, problems, and past behavior.

The approach:

• Focus on facts, not opinions
• Ask about their actual behavior, not hypotheticals
• Dig into how they currently deal with the problem

Example questions:

• “Can you walk me through the last time you dealt with [X]?”
• “What do you currently do to solve that?”
• “How much does this cost you (in time/money/frustration)?”
• “What happened the last time it didn’t work well?”

Listen for: A problem that’s urgent, frequent, and painful enough that customers are already trying to solve it — however crudely. Are they saying they have a problem, but it turns out they’re doing absolutely nothing about it, or it only comes up once every few years? You may not have problem-market fit.

Be sensitive to the major assumptions behind your business idea. Fitzpatrick suggests asking at least one ‘big scary question’ - the sort of question you might avoid asking because you know that if you get the wrong answer, it may show your startup isn’t going to work.

Once you are done asking them about the problem, you can then mention your solution and gauge their interest – by asking for a commitment, not their opinion. If they say they love your idea, see if you can get them to place an advance order, commit to joining a pilot - or anything else that actually signals they are prepared to spend money or time.

Consider reading The Mom Test in full, it’s a quick read and full of actionable advice about running an interview process.

How this could strengthen your pitch: If your interviews reveal that you’re solving a real problem, you should now be armed with evidence you can use directly in your pitch materials. You can summarise your results - “Spoke to 30 target customers; 23 of them had the problem; costing 23 hours per week + £250,000 per year”. Your interviews will likely also provide direct quotes you can include in your deck or pitch materials.

Profiling your customers' problems: Jobs to Be Done

If you have customers or users signing up and using your product, that should give you some confidence you are solving a real problem. But how well do you understand that problem? Is your startup actually solving the problem you thought it was? Or something slightly different?

That’s where Jobs to Be Done (JTBD) may come in. The framework, popularised by Clayton Christensen and Bob Moesta, is designed to reveal the "job" your product is being hired to do - and build up a detailed profile of the factors affecting decisions to ‘hire’ your product (and ‘fire’ whatever they were using before.)

Principle:

People "hire" products to get a job done (make progress, or solve a problem) - but often they’re unaware of why they do so. By taking them on a detail-obsessive chronological tour through their decision to switch to your product, you can uncover key factors that influence customer decisions and reveal your real competitors.

The approach:

• Take customers on a journey from the moment they decided to purchase your product, back to the very first thought they had of finding a (new) solution to their problem, and all the steps in between
• Be obsessive about detail - ask about the context, what else was going on that day, who they were with - anything to bring their memory back to the relevant moments
• Like The Mom Test - focus on real demonstrated behaviours and evidence over subjective opinions
• Pay close attention to “push and pull factors” that promote decisions to switch, and habits and anxieties that hold people back
• For a classic example, listen to the mattress interview

Example questions:

• “Take me back to when you decided to purchase. What were you doing that day? What time was it? What was the weather like? Who else was there?”
• “Do you remember when you first thought of finding a solution to this problem? What was going on?”
• “What other solutions have you used before? Any others you considered along the way?”
• “What were you hoping this product would help you do?”

Listen for:

• The ‘trigger’ to buy the day they decided
• Push and pull factors for change: the struggle they were experiencing before; what pulled them to try your new product to solve the problem
• Habits and anxieties against change: the inertial forces of habit that prevented them from switching; what questions/reservations held them back from switching.
• What solutions did they try and ‘fire’ before? What did they consider but never switch to? Why not? This should help you to understand your real competition, and positioning.
• Try to define the job to be done - it could be functional, social or emotional.

Not yet got a product or customers? You can still do JTBD interviews. Just find people who have recently purchased a competitor product, and tweak the questions above accordingly.

How this could strengthen your pitch: It could show that you are solving a real problem and you have a very precise understanding of what that problem is and who you are solving it for.

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Do I need commercial traction to show problem-market fit?

Not necessarily - at pre-seed stage, investors often have limited expectations for market traction. (For seed stage, see our article on traction metrics and benchmarks by sector). In many sectors funding is available pre-revenue; in sectors with long R&D cycles or intensive regulatory oversight funding can be common before a product is even launched. With that said, anything that shows market pull for your idea is clearly positive. Let's have a look at some milestones or metrics you could use. (Needless to say - this list is not exhaustive and may not make sense for your specific startup as every business and investor is different).

Idea stage traction milestones

Even without a product, users or revenue you can still show traction by meeting relevant milestones. Here are some examples of the types of evidence that might appeal to VCs:

Letters of intent (LOIs): Shows real buyer intent, not just curiosity. Should feature credible, relevant partners (not just friends or small players). The clearer and more specific the agreement, the better.

Concierge MVPs/manual pilots: Show who the pilot was with, why they’re credible or representative of your target market, and any key learnings that inform the product. Killer quotes from participants are useful here

Kickstarter/pre-orders: Show who bought, how quickly, how many, and what that proves about market demand, willingness to pay, and your GTM potential

Sales pipeline: Be honest and upfront about the status of the pipeline. Don't just add up the potential value of everyone you've ever spoken to — be specific (e.g. 30 expressed interest; 5 in final conversations; 2 signed LOIs valued at £X)

A waitlist (for consumer apps): Consider including metrics like % growth over time, or where they came from (e.g. paid, referrals, organic).

Early product stage milestones

If you have an active user base or you are generating revenue at pre-seed stage, you’re ahead of many. Here are some metrics that may help to demonstrate your progress:

Revenue growth (MMR)

Total MRR now vs. 1–3 months ago, MoM growth rate (%), and type of revenue (recurring vs. one-off, paid vs. freemium) can all be relevant.

Growth in active users (DAU/MAU)

DAU and MAU with % growth over time; DAU/MAU ratio (aka “stickiness”), and organic vs. paid growth. This reflects traction, market pull and word-of-mouth potential. Bonus: Can you show that people are actively using the pain point feature?

Feedback / Testimonials

Do you have customer reviews or NPS scores? What about positive testimonials or reviews? Even 5-10 paying customers with glowing testimonials can make a difference.

Retention

In general expectations are limited at pre-seed stage. Any evidence that users are returning week after week or month after month, or any sign of repeat purchases is good - whatever you've got that can show people are sticking around

Tailor validation milestones to your startup type

Different types of startups have different risk profiles, customer behaviors, business models, and paths to growth. VCs also have sector-specific expectations. Here is a general idea of the types of traction that may be relevant on a sectoral basis:

B2B SaaS: Signed LOIs, paid pilots, early customers, revenue

Consumer apps: Waitlist signups, DAU/MAU growth, retention

Deep tech / Biomedical / Regulated Sectors: Pilot/partnership interest, LOIs from credible customers, grant wins, regulatory approvals

Marketplaces: Early supplier & buyer engagement, Gross merchandise value (GMV) from early transactions

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One marker to keep in mind - founder-market fit

Rubén Domínguez Ibar, author of the Substack newsletter The VC Corner, points out that VCs often ask: Is this the right founder for the market? In the earliest rounds — where little else is validated — founder-market fit can be an extra marker of promise. Many VCs love to hear from founders who aren’t just solving a problem, but have actually lived it. Not only will they understand the pain points in ways others can’t, but they will persevere when most others would duck out. Just keep in mind - while it's great to know a problem intimately, you also need to show that it's not just a personal bugbear and there is a large enough market for a solution.

Ways to present problem validation in your pitch deck

VCs can spend as little as 2 minutes and 12 seconds digesting startup pitch decks, either to prepare for a call with a founder or to decide whether a call with them is worth their time. Throughout that time, they will be asking themselves: “why should I care?”

So how can you demonstrate that you’re solving a real problem in your pitch deck? Here are a few options:

• State the evidence - What are the reasons you know you’re solving a big important problem for your customers or users? Whether it’s a clear pattern in your customer interview data, or a compelling traction metric - put it across in simple terms.
• Use quotes - If you spoke to 20 or 30 (potential) customers, there should be one or two key quotes that demonstrate you are addressing a “hair on fire” problem
• The power of storytelling - if you’ve got founder-problem fit, you can tell your story. Otherwise, you could try to tell the story of one of your customers or interviewees in a way that hits home.

Common validation traps to watch out for

• Very vague or abstract problems, such as “knowledge sharing is hard.”
• Claiming to fix all problems simultaneously. Sometimes it makes sense to offer a solution for a suite of problems, but it can also indicate a lack of focus. Even if you have identified seven real problems - can you show that the market wants the same product to solve all of them?
• Mistaking interest for commitment, or just kind words
• Overclaiming traction: “$1M pipeline” (but no signed deals in reality)

Key takeaways

1. What is problem-market fit?

You have problem-market fit when your startup is addressing a real problem and a large (enough) market for a potential solution. The problem needs to be urgent, frequent and widespread enough to support a viable business.

2. What’s the difference between problem-market fit and product-market fit?

If you have problem–market fit, that means that your startup is addressing a real problem – but it doesn't say anything about your solution, or your ability to go-to-market. Product-market fit goes beyond this - not only are you addressing a real problem, you have also built something that solves that problem effectively and has real traction in the market.

3. How can I validate problem-market fit?

There is no one-size fits all solution. Some of the techniques founders rely on include citing personal experience (founder-market fit), market research data, and conducting customer research in the form of customer interviews. Two popular frameworks for conducting customer interviews to gain insights on problem validation include The Mom Test by Robert Fitzpatrick and Jobs to Be Done, popularised by Bob Moesta and Clayton Christensen.

4. How many customer interviews do I need to run to validate a problem?

There’s no magic number, but 15–30 interviews with your target audience is often enough to see patterns. Keep going at least until you stop hearing new things.‍

5. Which traction signals matter at pre-seed?

It depends on your specific business and the investor, but common signals include:

• B2B: LOIs, paid pilots, strong pipeline
• Consumer: Waitlist growth, engagement (DAU/MAU), retention
• Marketplaces: Both sides active (e.g. early GMV)
• Deep tech: Grants, partnerships, regulatory progress

6. How can I present problem validation in a pitch deck?

• State the evidence whether that is market research, interview data or personal experience (founder-problem fit)
• Use interview quotes that support your conclusions
• Tell customer stories or founder stories that bring the problem to life