Prove demand without a product: LOIs

Why this matters

Sustained revenue is the only real proof that people want what you're building. Everything else is a leading indicator. But most deeptech is years from revenue, so you need the next best thing: a signal credible enough that an investor will underwrite it. Done right, that's a letter of intent. Done wrong, it's essentially ignored by investors.

Not all LOIs are equal

The term LOI gets thrown around so loosely that investors have grown skeptical of it. A vague “we're excited to explore this” signed by a junior manager is worth almost nothing. A specific, conditional purchase commitment signed by an economic buyer is worth a great deal. The gap between those two is where founders win or lose this slide.

An LOI is a mutually signed document that formalizes a preliminary commitment between you and a customer, usually around a pilot or a first purchase. It lays out scope, timeline, and what each side commits to, and it signals intent to negotiate a real agreement.

What makes an LOI strong

An LOI doesn't need all of these, but the more it has, and in more binding terms, the stronger the signal:

1. A written intention to purchase, on a clear timeline. Not “evaluate when it's ready,” but intent to buy by a specific date if the specs are met.
2. Performance metrics that, when met, convert to a purchase order. Use the LOI to pin down the exact thresholds the customer actually cares about.
3. A defined purchase volume and price. How many units, at what price, by when.
4. Repercussions for not following through. Real accountability, like penalties, if they walk.

How to get one signed

• Make it benefit the customer, not you. Frame it around early access, exclusivity, discounted pricing, or a competitive edge, never as a favor you need.
• Co-create it. Draft it together so there are no surprises and they feel ownership.
• Create genuine urgency. Limited early-adopter capacity works (“we can only support three partners in this phase”), as long as it's real.
• Get it signed by leadership. Investors notice who signed. A department manager and the CEO are very different signals.

LOIs vs. LOS vs. MOU

Know the difference, because they carry very different weight. A Letter of Support (LOS) is third-party validation, an expert or stakeholder lending their name, useful early but far weaker than an LOI. An MOU usually describes a partnership or collaboration, not a purchase. In deeptech, LOIs are the ones that demonstrate real commercial traction; MOUs are for exploratory relationships.