🧠 Traction isn't just sales. It's a ladder.

When you're so obsessed with closing deals that you skip the eight rungs before it that make the sale possible.

Hey friends 👋

“Does this count as traction?”

I hear this question all the time. A founder asks after ten customer interviews, or after building an MVP, or after landing their first pilot commitment.

But they’re not really asking about “traction”. They’re asking: “can we raise money now?”

The problem? Most founders think traction means either “everything we’re doing” or only sales. So they either convince themselves they have zero traction (when they actually have plenty) or jump straight to chasing revenue before they should (which wastes obscene amounts of time and money).

Last week, I facilitated a startup competition at LMU, where I toyed with the metaphor of a “ladder” to explain the acquisition of traction. The students found it helpful, so I thought I’d share it here..

Let’s dive deep 👇

Let’s start with the misconception

It’s not all about sales.

In common conversation and in feedback from investors, it’s easy to get the impression that sales is the only thing that counts as traction. At first glance, it kinda makes sense:

Sales is the most visible evidence of progress. Investors talk about revenue and growth, especially in later stages. Founders brag about deals closed and logos obtained. And revenue is the scoreboard everyone can see.

Sales is the ultimate traction… except that it’s not.

Because sales isn’t even the top of the traction ladder.

Once you get customers, you have to keep them. And then get them to tell their friends. Retained and referring customers as infinitely more valuable to your success than your first few closes.

But sales definitely isn’t the bottom of the ladder, either.

You can’t close deals unless you’re the right solution. You can’t be the right solution without an urgent problem with a willing buyer. And you can’t prove the problem without finding the right customers.

That’s where the metaphor comes in:

Traction is a ladder you climb.

Progressive evidence gathering. Not some switch you flip.

Think of traction as nine distinct rungs you can rest your foot on. Each builds on the last, and each requires different evidence. The higher you go, the more you can justify bigger bets.

Let’s break it down:

Rung 1: Idea & discovery

It’s new. The early days. You’re doing qualitative work: market research, industry reports, customer interviews, scrolling Reddit threads at 2am. Talking to anyone who’ll give you fifteen minutes.

You’re figuring out who has problems worth solving. This is purely qualitative. No experiments yet. Just learning.

Rung 2: Problem validation

Now you’re confirming people have severe and urgent problems. Not just mild annoyances they complain about at happy hour.

You’re looking for behavioral signals. Waitlist signups. Repeated engagement. People trying multiple failed solutions. Spending real money or time attempting to solve this problem.

If they’re already spending resources on it, they’re willing buyers. That matters.

Rung 3: Solution signals

Time for fake door tests. Landing pages. Rapid prototypes. Figma mockups you can click through.

This is where qualitative becomes quantitative. Can you get people off Instagram and onto your landing page? Do they want this solution to that problem?

You’re testing whether your specific approach resonates, not just whether the problem exists.

Rung 4: Commitments

LOIs. Pilots. Design partnerships. People putting skin in the game.

Notice I said “skin” in the game, not money. At this rung, attention and time commitments count. They’re committing resources to work with you, and that’s validation.

Rung 5: Paid pilots & early discounts

Early dollars start coming in. Maybe not full price yet. Maybe deeply discounted. Maybe just covering costs.

But they’re paying.

Not just promising. Not just “we’d totally buy this if you add these seventeen features.” Actually opening their wallets.

Wahoo!

Rung 6: Early revenue

Real sales — but at market prices. Full-price subscriptions and contracts with customers who aren’t your mom’s friend’s company.

This is what most founders think “traction” means. But it’s in the upper middle, because you can’t get here without rungs 1-5.

And there are still two rungs to go!

Rungs 7–8: Retained & referring customers

People stay, they bring friends, and your renewal rate doesn’t make you want to sit down and cry.

Your customers are actively bringing in new ones.

This is the actual top of the ladder. You can finally prove that you have a sustainable business — not just a good sales pitch.

Please don’t try to skip rungs.

Customer interviews only cost you time. Maybe coffee money.

But building an MVP costs $50K+ if you’re careful — and way more if you’re not. Launching at scale… add a zero or two.

Each rung on the ladder takes more and more effort to validate.

The catastrophic mistake founders make is trying to jump from rung two straight to rung seven.

And I get it. They want the dollars. So they do a handful of interviews, then immediately build an MVP. They assume “if we build it, they’ll pay.” They waste tens of thousands of dollars testing assumptions that could have been validated with a landing page and some Facebook ads, for little more than lunch money and your wits.

In other words:

Higher rungs require bigger bets. Bigger bets require more evidence.

And big bets with little evidence? Yikes.

Each rung up the ladder requires more evidence to justify the bigger bet, and the wise founder proportions her effort to the evidence.

Gather evidence at each level. Run a landing page test before building the product. Get paid pilots before hiring a sales team. Prove retention before scaling acquisition.

The higher you climb with real evidence, the stronger your position for everything — including fundraising.

How this connects to checks

Each rung maps roughly to fundraising stages.

Angel checks typically fund companies at rungs 4-5. You’ve got solution signals and maybe some commitments. You need money to build the real thing and start pilots.

Pre-seed funds companies at rungs 5-6. You’ve got paid pilots, probably early revenue, and a hypothesis about how growth might work.

Seed funds companies at rungs 6-7. You’ve got early revenue, early retention data, and the beginnings of a growth engine you’re starting to understand.

Series A funds companies at rungs 8-9. You’ve got retained customers, a functioning and proven growth engine, and the ability to scale it profitably.

Why does this matter?

Investors fund your next climb, not your current rung. In other words, the money they give you is to help you climb from where you are to where you need to be next.

So if you’re at rung 3 (problem validation) asking for Series A money (which funds the climb from rungs 8-9 to something even bigger), the answer is no. You can’t get growth-engine-scaling money with just problem validation.

The evidence you have determines how much you can raise and from whom.

You are your startup’s first investor.

So this also applies to your effort. Your time is the one resource you can never get back, so stop betting your next six months on assumptions you could validate in six days.

Climb the ladder methodically and steadily. Don’t skip rungs. Build evidence before making bigger bets.

That’s how you build real traction — and a real company.

Until next week,

—jdm

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