VCs Are Turning Away From The ‘fixer-Upper' Founder

Forbes

3 days ago

Faster. Better. Smarter. Smoother.
What might sound like a Daft Punk lyric has become something of an anthem for tech startups. In recent years, a strong proportion of the pitches I've reviewed have been for startup ideas focused on incremental gains. Think faster versions of existing tools, smoother, more interoperable systems, and any other kind of upgrade ending in '-er'.
Of course, aiming for better is no bad thing. By improving on great ideas, we can drive progress and develop more tailored solutions. And there have been brilliant, highly successful businesses that have emerged as a result of this philosophy: zoning in on a need and applying tech or better design to make it more efficient, effective or enjoyable.
But, as I covered in my recent piece on moat building, the rise of vibe coding and open-source AI means being the 'best version right now' is no longer defensible as a long-term strategy. Betting on being the next best upgrade is a losing game. It leaves your offering just one fix or disrupter away from being replaced.
Computer service and assistance concept with work tool icon on a laptop keyboard 3D illustration.
That's why VCs like me are turning away from 'incremental improvers' in favour of paradigm-shifting experiences; startups who are building something genuinely novel with a user experience that's 5 or even 10 times better. So if you're a founder hoping to attract investment, here are three things you can do to demonstrate that you're more than a fixer-upper.
1. Disrupt, don't decorate
The idea that 'disruptors' have the greatest potential for long-term impact is nothing new. But now, in a market increasingly saturated by 'add-on' technology, it's more important than ever that founders distinguish themselves from what's already out there.
That means daring to imagine where technology is heading, not just where it is today. Startups able to do this have a much greater shot at reaching and dominating untapped markets. Revolut's $48 billion valuation and Airbnb's $11bn annual revenue didn't come from minor upgrades or applying a bit of polish around the edges. They're the achievements of founders who believed that things could be done differently to deliver a customer experience that was unlike anything else. And then built platforms that made it a reality.
Perhaps you're disrupting an industry because you've lived its challenges first-hand. This was the case for Molly Johnson-Jones, who co-founded Flexa (an Ada portfolio company) after being fired for asking to work from home while managing a chronic health condition. Today, millions of people use the platform to access transparent, verified information on different working environments and cultures, so candidates can find roles that actually work for them. With no predecessor and no playbook, Flexa has carved out a category of its own and become indispensable to modern jobseekers.
Or maybe you're introducing much-needed digital solutions to fix an age-old analogue problem. Take Patchwork Health for example. Founded by two NHS doctors who were frustrated by the relentless pressure and lack of flexibility on the frontline, their digital workforce management tools are making sustainable staffing a reality in healthcare. Patchwork's tech-led approach includes an app which lets clinicians book shifts, request holiday and manage their own schedules all in one place. Meanwhile, managers can view staffing trends and fill vacancies through the same platform. This isn't just an upgrade, it's a huge step in modernising a process that's long been held back by archaic systems, siloed data and painstaking admin.
So if you find yourself saying 'we're the next [insert successful company],' it's worth asking: am I a disruptor, or merely a decorator neatly papering over cracks?
2. Uncover, then unlock
Fixer-upper founders jostle for space in a market. Real disruptors prise open the doors to places no one has set foot yet. They identify the unmet needs that have existed for so long that everyone else has just taken them for granted. And then they set about solving them.
A great example of this in action is Valla (an Ada portfolio company). Their AI-powered legal tech platform empowers workers embroiled in employment law disputes to access advice. An estimated 12.4 million employees are affected by employment law breaches each year. By bringing down costs and democratising access to support, Valla are unlocking a vast, overlooked user base with huge potential for growth. They're truly offering a type of service that simply doesn't exist anywhere else today.
Another example, also in the legaltech space, is Orbital. Through machine learning and AI, their platform streamlines the dense, paperwork-heavy processes of property due diligence, giving lawyers an instant view of the risks and red flags buried in leases and deeds. They're not competing with innovations from last year - or even from this century. Instead, they're transforming processes that date back to the Victorian era.
This is what investors like me are after: solutions to long-written-off problems, not face-lifts for challenges that have largely been addressed.
3. Think far, not fast
Disruption is not a product, it's a process. It requires a continued commitment to uncover new market opportunities and develop new solutions for consumers. There is perhaps no greater example of this than the stratospheric rise of Netflix. What began almost 30 years ago as an innovative new model for DVD rentals is now the world's largest streaming platform; an entertainment behemoth constantly improving to stay ahead of the competition.
Netflix's dominance isn't just the result of one good idea, or one small improvement to existing services, it's a testament to their ability to look ahead. Instead of stopping at streaming (or indeed at rental by post!), Netflix has continued to lead the market with award-winning original content and unique in-app features. The lesson for founders here is clear: success requires you to champion a business model and a mindset that embraces change.
Of course, startups will always need to tinker with existing products and make tweaks to improve their offering. But this shouldn't come at the expense of thinking big. This is where initiatives such as Google's famous '20% time' policy can be helpful; encouraging teams to regularly focus their efforts on more future-gazing projects, and proving to investors that you're serious about driving impact.
Fixer-upper founders are stuck in the here and now. They admirably take on the pain points of today, but offer little inspiration for tomorrow. True disruptors don't just muscle their way into new markets; they create new categories, cater to unmet needs, and put the work in to stay on top. If we're to address some of society's biggest challenges, we need more innovators and fewer renovators. And investors have their eyes trained on the difference.