Every few years, a new startup catches the imagination of venture capitalists — usually right around the time it begins to look like an “obvious winner.” There’s a scramble to get into the round, prices soar, and everyone wants to believe they’re backing the next OpenAI or Stripe. Sometimes they’re right. Other times, the market hype collapses and we’re left dissecting what went wrong.
The conversation around consensus vs. non-consensus investing offers a useful framework for thinking about these dynamics. At Dellecod, we’ve spent time reflecting on where great investments tend to originate and how early conviction plays out — especially in markets that evolve fast and unpredictably. We’re not investors ourselves, but we build software with startups, so we get a front-row seat to how they grow, struggle, and occasionally bend the market to their will.
The most interesting observation is that leading startups often don’t look “hot” at the earliest stages. They’re messy, underdog stories — sometimes misunderstood or underestimated, occasionally slow to raise capital. In hindsight, it’s tempting to draw a straight line from a small idea to global dominance. But the reality is far less linear. Non-consensus investments often look like mistakes until milestones are hit and market narratives shift.
This gap between perception and potential is part of what makes early-stage investing so difficult. Get in too early and you risk backing something that can’t raise follow-on capital. Wait too long and you’re battling a wall of well-funded competitors for a slice of a rapidly inflating valuation. Timing is everything, but timing also depends on your ability to read signals the market hasn’t yet priced in.
One way we think about it: are you betting that the company is “working,” even if it’s not obvious yet? Or are you simply reacting to a competitive round and a glossy pitch deck? The former is where exceptional returns come from. The latter can still work — especially in winner-takes-most markets — but the risks are different.
There’s an old Peter Thiel quote: “The faster and higher the up round, the more you should invest — because it’s working.” It's a bold statement, especially for a world obsessed with getting in at the lowest possible price. But there's truth in it. If a team is attracting capital quickly, and the product is scaling, momentum is real. This is not to say every high-valuation deal is worth it. Just that velocity itself might be a positive signal, not a red flag.
It’s important to distinguish between buzz and substance. Take some of the marquee exits of the last decade — from Coinbase to Databricks. Many had periods of struggle or skepticism before catching fire. Some raised modest early rounds, even facing rejection from major VCs. Yet once traction became undeniable, the consensus caught up, and their valuations reflected not hype, but performance.
What we’ve learned watching these journeys is that valuations — especially in early rounds — aren’t always arbitrary. High prices can reflect quality. They don’t guarantee success, but they often point to strong teams executing in ambitious ways. In other words, the market can be efficient, particularly in environments with lots of data and close-knit investor networks. But efficiency doesn’t mean uniformly correct. It just means that “weird” bets need strong internal logic and even stronger planning — especially when it comes to raising future rounds.
If we had to pick a single cause of failure that comes up most often, it’s not a lack of capital — it’s misuse of capital. The idea of startup “indigestion” — raising too much, too early, and spending wildly — is far more dangerous than “starvation.” Scarcity can sharpen focus. Overabundance can blur core problems.
In practice, some of the most iconic companies — Airbnb, Uber, Robinhood — were non-consensus at first. They came with regulatory baggage or cultural skeptics or thin initial traction. Armed with grit and clarity around their product-market fit, they pulled ahead until it became hard to imagine the category without them.
By the time consensus forms, the price has changed. That’s okay. Not every win needs to come from a contrarian seed round. Strong execution in a fast-growing market can turn even a pricey Series A into a career-defining outcome. Being in the right companies matters more than being the earliest or the cheapest.
At Dellecod, working alongside founders, we’ve noticed how difficult it is to maintain conviction when the market hasn’t caught on yet. The ability to see around corners — to anticipate what future investors will need to see in order to fund the next round — is a skill we deeply respect. It’s a blend of storytelling, data-driven insight, and operational excellence.
Startups are rarely “obvious” at the beginning. They become obvious through relentless execution and thoughtful scaling. Venture capital might be a game of outliers, but the outliers often began as deeply misunderstood bets.
Which just makes it all the more important to understand how markets behave — and when it’s worth agreeing with the crowd versus seeing something before the crowd does.