Part 4: Showing Traction & Preparing for the Fundraise

<aside>

Turn science into fundable traction for seed using TRLs, third-party validation, design-partner proof, and a crisp proof-pack/data room. MedTech overlay included.

Outline:
Tools: </aside>

1. What Counts as Traction for a Deep Tech Startup

Traction is not revenue alone.

In deep tech, early traction is a chain of de-risking milestones that systematically reduce technical, market, and execution risk. Unlike software startups that can point to user growth or monthly recurring revenue, deep tech progress is measured by how effectively you're eliminating the reasons investors might say no.

Signals investors take seriously:

Technical: Reproducible experimental data with error bars, third-party validation from recognised labs or institutions, performance metrics benchmarked against incumbent solutions or theoretical limits, peer-reviewed publications, working prototypes that demonstrate core physics/chemistry (even if not optimised), and patent filings that show defensible IP positions.
Market: Design partners who commit engineering resources to integration, LOIs that specify quantities and target pricing, MOUs with strategic value beyond mere interest, paid pilot programmes or feasibility studies (even small ones validate willingness to pay), endorsements from recognised KOLs in your field, and evidence of regulatory pathway understanding where applicable.
Execution: Detailed technical roadmap with quantified milestones and decision gates, transparent budget allocation showing how capital extends runway to value inflection points, team with complementary skills (technical founder + commercial ambition, even if unproved), successful grant applications (validates peer review of science), supply chain partnerships or manufacturing relationships already engaged, and evidence of capital efficiency from previous funding.

Investor rule of thumb: If achieving a milestone makes your next funding round materially more likely at 2-3x the valuation, it's traction worth highlighting. Each milestone should answer a fundamental question about why your venture might fail—and prove that it won't.

</aside>

2. Technology Readiness Levels (TRLs) explained

TRLs help translate lab progress into a common language investors can understand. Here is a break down of the most relevant TRLs for those raising their seed round. You technology should be somewhere along this spectrum if you are raising you are a deep tech startup raising your seed round:

TRL	Plain English	Evidence investors expect	Example: Medical Device	Example: Metal Extraction
3	Principle shown	Experiments confirm the effect beyond theory or simulation; methods recorded; early stats, not anecdotes	Novel biosensor material shows selective binding to target biomarker in buffer solutions with quantified response curves	New solvent system demonstrates 95% extraction efficiency for lithium from brine samples in lab glassware
4	Lab validation of components	Reproducible results with controls; comparison to a named benchmark; draft verification plan	Biosensor chip maintains sensitivity across temperature ranges, outperforms current gold standard by 3x in side-by-side testing	Extraction process works consistently across different brine compositions with recovery rates benchmarked against current methods
5	Prototype validation in relevant lab environment	Working bench prototype; third-party test or witnessed test; beginning reliability/variability data	Working sensor array processes real patient samples, validated by independent lab using standard clinical protocols	Pilot extraction unit processes 10L/day of actual mine wastewater with third-party verification of metal recovery and waste stream purity

When raising a deep tech seed round, typically you’re going to be focussed on showing where you are from TRL 3 → 5. This is essentially going from science to engineering risk. Each subsequent round of financing should move you 1-2 TRL levels forward.

Why it matters: TRL 3–4 is feasibility and still risky. TRL 5 is the moment most seed investors lean in. When there is material market risk as well as technology risk, this often goes up to TRL 7 because the investor is not wanting to buy both the technical risk and the market risk associated with the approach

</aside>

TRL Translation Reference Guide

Use this as a common language with investors. You should adapt the wording to your domain.

TRL	What it means	Typical evidence & artefacts	Gate to next level	Example milestone
1	Basic principles observed	Literature survey, hypothesis, back-of-envelope calculations, first models	Hypothesis with measurable predictions and target metrics	Concept note with initial physics/chemistry model
2	Application conceived	Concept formulated, block diagrams, materials/architecture choices, analytical model	Identify critical functions, key risks, and benchmark to beat	Architecture sketch with performance targets vs incumbent
3	Experimental proof of concept	Bench experiments show effect beyond theory/sim; lab notebook, early stats; methods captured	Repeatability with controls; protocol locked	Small rig shows 3× improvement on named benchmark in controlled test
4	Component/breadboard validated in lab	Reproducible component tests; interface definitions; draft verification plan	Verification plan approved; comparison to benchmark; initial reliability snapshot	Sub-component meets spec across n≥3 runs with error bars
5	Prototype validated in relevant lab environment	Integrated bench prototype; third-party or witnessed test; variability and drift measured	External report complete; risks retired to pilot plan	Independent lab confirms performance; pre-pilot checklist ready
6	System/subsystem demo in relevant environment	Integrated prototype exercised under relevant conditions; limited-duration field test	Reliability and safety good enough for pilot; pilot site and objectives agreed	Containerised demo at partner site with data logging
7	System prototype in operational environment	Pilot with real users; design frozen for production intent; reliability dataset	Design freeze; supply chain and regulatory path de-risked	500–1,000 hours runtime; pilot KPIs met; on-ramp to purchase order
8	Actual system completed and qualified	Compliance and certification testing; process validation; PVT builds; yield data	Launch readiness: manufacturing, quality, labelling, support	CE/UL certification; validated line at target yield and cost
9	Proven in routine operation	Commercial deployments; post-market surveillance; field performance	Stable performance and economics at scale	Fleet reliability and unit economics meet targets for >2 quarters

Further notes on TRLs

Often times your innovation will be the lowest TRL part of a more mature system. Make sure you investors understand where the technology risk resides (i.e. what is the lowest TRL part of the system)
The bigger and easier your market opportunity is, the more technology risk the investor can afford to take. If the end market is energy generation you can support a lower TRL than if your application is in Defense. </aside>

<aside>

Full TRL Reference (Click to Expand)

</aside>

Learn More: