The Value Crystallization Paradox | SRV
Valuation, by itself, isn’t value.
That’s the paradox.
You can pay for a solid report, built on data and careful reasoning. You can compare peers, model cash flows, and match your stage to market benchmarks. But until someone acts, it’s just potential.
* No lead investor and the number stays theoretical
* No term sheet and the model is hypothetical
* No market signal and the value hasn’t crystallized
It’s like a ship tied up in port — ready to sail, but going nowhere.
Early-stage companies often face a moving target. The product may still be in beta, with features changing weekly. Customer traction can be uneven — a promising pilot one month, stalled negotiations the next. Competitors may launch a similar offer before your fundraising is complete, changing investor perception overnight. Even inside the company, investor decks and financial projections get reworked mid-round as assumptions shift.
Market conditions add another layer. A sudden drop in public tech valuations can ripple down to venture funding, making investors cautious. In some sectors, a change in regulation or grant funding can instantly raise or lower the perceived risk profile. And while founders are adjusting to all this, investors compare them to other deals they’re seeing — deals that may look “hotter” simply because they’re further along in customer acquisition or strategic partnerships.
In that environment, even a well-supported number can drift. Founders wait for the “right moment” to pitch. Investors hesitate, preferring to watch for a milestone before committing. Momentum slips, sometimes quietly enough that nobody notices until the round has gone cold.
Yet valuation still matters. It frames negotiation. It sets expectations inside the company. It gives advisors and partners a starting point. The challenge is turning it into something that moves before time works against it.
That’s the tension: necessary, but contingent.
In the next post, we’ll look at how to move from valuation on paper to valuation in motion.
