The lack of published research was the reason to look
An early stage venture investor was looking at a company in a market with no analyst coverage and no published sizing. Nobody had written the market up, which was part of what made it interesting and all of what made it hard to evidence. By the time research on a market is published, the opportunity in it has usually been priced.
Diligence at this stage cannot lean on secondary sources, because there are none. It has to reach the small number of people already working in the space, and it has to reach them before the round closes. Finding those people is the harder half of the job. Reading what they say is the easier half.
We reached the people already working in the market
We scoped the read around the investor’s specific conviction question rather than around the market in general. Then we went looking for practitioners already operating in the space, and for the early buyers in it. Part of the group was recruited specifically rather than drawn from people we already knew, which is the only way a market like this is reachable.
Adjacent markets were used as reference points where the target market was still too young to evidence. The engagement was scoped to the investor’s decision window, since a read that lands after the round has closed is an interesting document rather than a useful one. Every expert cleared the Nextyn compliance framework before scheduling, which matters in a small market where people know each other.
Conviction reached before the round closed
The investor formed a view built on people already working in the market rather than on the absence of anything contradicting the thesis. The thesis held, and the investment proceeded. What mattered was that the conviction rested on what practitioners said rather than on the founder’s own account of the market.
The group we found stayed relevant as the market developed, so later reads on the same space began from people we could go back to rather than from a blank page.
