The Pernant Struggle of Proving to Potential Investors a Pre-Order Product is Worth Acquiring Perpetuity

The Pernant Struggle of Proving to Potential Investors a Pre-Order Product is Worth Acquiring Perpetuity

In the dynamic world of startups, the journey from idea to market success is often fraught with challenges. For the young startup HID SIPS™, the challenges have come in a collection of crashing waves. “We’ve ridden the waves well,” says CEO Daniel Victor, “and others have sent us toppling and looking for our surfboard.” One of the most critical hurdles, for any Startup, is securing funding to transform a visionary concept into a tangible reality. While fundraising is never a walk in the park, it becomes particularly tricky when a startup is in its pre-order phase. In this article, we’ll delve into the unique challenges that entrepreneurs face when seeking investment at this crucial juncture and explore strategies to overcome these obstacles.

1. The Uncertain Terrain of Product Development

Fundraising for a startup in the pre-order phase is akin to asking investors to bet on a horse that hasn’t even completed training. At this stage, the product might still be in the development pipeline, with limited tangible evidence of its potential success. Investors are inherently risk-averse and tend to favor ventures that exhibit proven traction. Convincing them to back a product in its nascent stage requires proper navigation. In one way, that may be a compelling pitch that outlines a clear development roadmap and showcases how a product fills a gap in the market. In other, it may be bolstering statistics that were acquired in the horse's training and serve to satisfy skepticism about how that horse will perform when the gates open on race day. HID SIPS™ has utilized both of these prospects; conveying the clear-cut complaint that nearly 3 in 5 elderly adults complain of constantly waking up with a dry mouth and displaying the HydraLamp social media stats of CPC and CTR rates that double industry standards.

2. Overcoming Skepticism with a Strong Value Proposition

Investors often approach pre-order stage startups with a healthy dose of skepticism. In the post-pardon Softbank era, this is certainly no exception. VCs might question the viability of the product, its market fit, and the startup’s ability to execute its vision to poke holes and lower the valuation in parallel. To counter this skepticism, it’s essential to craft a robust value proposition. This includes a developing deep understanding of the target audience, a well-defined problem the product solves, and a demonstration of how the solution is superior to existing alternatives. Data-driven insights, market research, and potential customer testimonials can add weight to a company’s claims.

3. Striking a Delicate Balance with Pricing

Determining the right pricing strategy for a product in its pre-order phase is a delicate balancing act. Set the price too low, and startups risks undervaluing their product; set it too high, and they may struggle to attract early adopters. Investors are likely to scrutinize pricing strategy, as it reflects an understanding of the market and an ability to monetize the product effectively. Clear articulation of pricing rationale and how it aligns with customer expectations is crucial when seeking funding. Today, startups like HID SIPS™ are warming up investors to the certainty surrounding their price by using pre-order platforms like Kickstarter; where HID SIPS™ saw average order values of roughly $130.

4. Building Credibility and Trust

A lack of a tangible product in the pre-order phase can make it difficult to build credibility and establish trust with potential investors. For companies that have a tangible product, minimum order quantities and long lead times make it tough to physically get that product into the hands of potential customers and must settle for creating online content. To counteract this, new businesses must focus on building a strong online presence and engaging in transparent communication. This is why it’s important to leverage social media, build a professional website, and utilize thought leadership content to demonstrate industry expertise and commitment to the project. HID SIPS™ has depended on highlighting milestones achieved, partnerships formed, and industry recognition garnered as some of the many ways to bolster a startup’s credibility.

5. Leveraging Early Customer Engagement

One significant advantage of the pre-order phase is the opportunity to engage with potential customers before the product’s official launch. This time can be used to gather feedback, refine the product, and showcase early adopter interest to investors. A solid number of pre-orders or a growing waitlist can serve as powerful evidence of market demand and validate a startup’s potential. Sharing success stories and testimonials from engaged customers can also instill confidence in investors.


Fundraising during a startup’s pre-order phase is undoubtedly a challenging endeavor, requiring a unique blend of strategic planning, effective communication, and unrelenting determination. Overcoming the uncertainties of product development, addressing skepticism, pricing thoughtfully, establishing credibility, and leveraging customer engagement are all pivotal steps in convincing investors to buy into a vision. Remember, while the path might be arduous, successfully navigating these challenges can set a startup on the road to turning a promising idea into a thriving reality.

“We’re excited to be evolving as a company,” stated HID SIPS™ CTO Austin Malm, “and with that growth entertaining new investors and partnerships. Furthermore, we are happy to share this progress with potential investors and possible startups that haven’t even formed yet.” For those who are interested in how HID SIPS™ has validated the market before their product has hit the doorsteps of their pre-order customers, more can be learned by looking at their investor page and pitch deck here and contacting for potential investment opportunities.

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