How pitching investors is different than pitching community

TL;DR

In Web3, founders often struggle to connect with investors and communities simultaneously. While investors focus on return on investment (ROI), scalability, and risk mitigation, communities prioritize transparency, shared values, and active participation. This blog explores actionable strategies and real-world examples to help founders meet investors’ demands for ROI and scalability while enriching community engagement through transparency, shared principles, and inclusivity.

Intro

Founders in the Web3 space wrestle with a unique challenge: they must pitch their ideas to two distinct yet equally significant audiences—investors and the community. While investors bring the capital needed to scale, communities drive adoption, governance, and long-term sustainability. Achieving success in any Web3 project requires a careful balancing act between these two forces. However, pitching to these audiences requires vastly different approaches. 

This blog explores how pitching investors differs from pitching the community in Web3. Through actionable strategies, real-world examples, and data-backed insights, we’ll help you craft compelling narratives that resonate with both audiences and ensure your project succeeds in this decentralized ecosystem.

Why the Distinction Matters in Web3

Web3 projects are fundamentally different from traditional businesses because they rely heavily on decentralization and community participation. While investors provide the financial resources to build and scale projects, communities are essential for driving adoption, co-creating value, and ensuring long-term success.

• Investors focus on metrics like ROI (Return on Investment), scalability, and market potential. They evaluate whether your project can deliver significant financial returns over time.

• Communities, on the other hand, care about shared principles like decentralization, inclusivity, and transparency. They want to feel like co-creators rather than mere users.

Failing to address these differing priorities can lead to misaligned expectations and hinder your project’s growth. For example, a project overly focused on investors may isolate its community, while a community-centric approach without investor backing could struggle to scale.

The key is understanding these nuances and tailoring your narrative accordingly.

For example, Ethereum’s transition from Proof-of-Work (PoW) to Proof-of-Stake (PoS) succeeded because it balanced strong community support with institutional backing. This alignment ensured both technical upgrades and widespread adoption, becoming a lesson every Web3 founder should heed.

Pitching Investors 

When pitching to investors in Web3, your primary goal is to position your project as a sound investment opportunity. Investors want confidence that their capital will generate returns while mitigating risks. Here’s how you can create a pitch that resonates with investors:

1. Showcase Market Potential

Investors need to see clear evidence of market opportunity backed by strong supporting data:

• Highlight industry trends that validate your project’s relevance. For example, cite data from the global blockchain market and then demonstrate how your project can capitalize on this significant growth opportunity. Consider including statistics such as: ‘The global blockchain market is projected to grow at a CAGR of 53% to reach $273.23 billion by 2030.’

• Identify specific pain points your project addresses and quantify its Total Addressable Market (TAM). For instance, if you’re building a decentralized lending platform, explain how it solves inefficiencies in traditional finance and estimate its potential share of the DeFi market.

Example: A decentralized identity solution could highlight how it addresses privacy concerns in Web2 systems while tapping into an emerging $50 billion identity verification market.

2. Highlight Scalability

Scalability is one of the first questions investors will ask:

• Explain how your project can handle increased demand without compromising performance. Detail technical innovations like Layer-2 solutions (e.g., zkSync or Optimism) or unique architectural designs.

• Use case studies from successful projects like Polygon to illustrate scalability in action—how they reduced Ethereum transaction costs while increasing throughput.

Investors want assurance that your infrastructure can support growth without bottlenecks or excessive costs. Highlighting scalability also demonstrates long-term viability, a key factor in securing funding.

3. Tokenomics as a Revenue Model

Tokenomics often serves as the strongest pillar of a Web3 project’s business model:

• Clearly outline token distribution plans (e.g., allocation for team members vs community rewards), utility within the ecosystem, and emission schedules.

• Visual aids like pie charts or flow diagrams can make complex tokenomics easier to understand.

Additionally, emphasize how tokenomics incentivizes user retention or ecosystem expansion—two factors that directly impact long-term revenue generation.

Example: Axie Infinity generated over $1.3 billion in revenue in 2021 through its play-to-earn model powered by AXS tokens. Show how your tokenomics align incentives across stakeholders for sustainable growth.

4. Address Risks Transparently

Web3 investors are highly aware of risks like regulatory challenges or market volatility:

• Be upfront about potential obstacles and outline strategies to mitigate them.

• Discuss regulatory compliance efforts (e.g., aligning with MiCA regulations in Europe) or contingency plans for bear markets.

Acknowledging risks doesn’t weaken your pitch; it strengthens it by showing you’ve thought critically about potential challenges and are prepared to address them proactively.

Example: Ripple has maintained investor confidence by openly communicating its legal roadmap during ongoing SEC litigation—proving that transparency builds trust even in challenging times.

5. Demonstrate Traction

Traction is about showing momentum. Highlight milestones that signal growth potential or validate demand for your solution.

Investors value evidence of product-market fit because it reduces perceived risk:

• Share metrics like Monthly Active Users (MAUs), Total Value Locked (TVL), or early revenue figures.

• Include testimonials from key partners or early adopters who validate your solution’s impact.

Example: dYdX has processed over $278 billion in total trading volume since inception, demonstrating significant traction in decentralized derivatives trading.

Pitching the Community

In Web3, communities are your co-creators who actively shape your Web3 project’s success through participation and advocacy. Pitching to them requires a fundamentally different approach. Here are five key strategies to effectively pitch and engage your Web3 community:

1. Align with Shared Values

Web3 communities rally around projects that resonate with their principles, such as decentralization, financial inclusion, or privacy. To build a strong connection, you must demonstrate how your project aligns with these values. Use storytelling to create an emotional connection with your audience and communicate your mission authentically.

Example: Bored Ape Yacht Club built loyalty by offering exclusive benefits tied to NFT ownership, like events and merchandise, creating a sense of belonging among members.

2. Prioritize Transparency

Transparency is non-negotiable in Web3. Communities want to feel involved in your project’s journey and trust that their contributions matter. Open communication about developments, challenges, and goals enhance loyalty and confidence.

• Publish detailed roadmaps on platforms like GitHub or your website so community members can track progress.

• Regularly host AMAs (Ask Me Anything sessions), where founders address questions openly. Share both successes and setbacks—honesty builds credibility.

Example: Cosmos maintains open-source repositories while engaging its community through interactive updates on its website—strengthening trust and collaboration.

Transparency reassures communities that their contributions matter and builds confidence in your leadership.

3. Incentivize Participation

Communities flourish when members feel valued and rewarded for their contributions. By offering meaningful incentives, you can transform passive supporters into active participants who help drive your Web3 project forward.

• Implement token-based rewards for activities like voting on governance proposals or creating content. 

• Offer exclusive rewards like NFTs or early access to new features for contributions such as voting or content creation.

Example: MakerDAO incentivizes participation through governance tokens that allow members to vote on protocol changes and other key decisions, boosting ownership while aligning community interests with the project’s long-term goals.

4. Simplify Onboarding

Unlike investors who often have technical expertise, community members come from diverse backgrounds with varying levels of familiarity with blockchain technology. Simplifying onboarding ensures that everyone can participate without feeling overwhelmed.

• Create beginner-friendly guides or tutorials that explain complex concepts in simple terms. 

• Use infographics or videos to visually communicate key ideas. 

• Avoid jargon wherever possible.

Example: Reddit’s Community Points system uses simple language and seamless onboarding processes to introduce non-crypto users into Web3 ecosystems effectively. By integrating blockchain-based rewards into an interface familiar to Reddit users, the platform has successfully introduced millions of non-crypto users into the decentralized ecosystem.

5. Improve Engagement Through Events

Events are powerful tools for building relationships within your community while showcasing your project’s vision and progress. They provide opportunities for real-time interaction, learning, and collaboration, helping to deepen relationships with your audience while driving innovation. Whether it’s a hackathon to attract talented developers or virtual meetups to engage a broader audience, events create touchpoints that bring your community closer to your mission.

At TDeFi, we take this a step further with our latest initiative, The Republic ’s Cohort—an exclusive and transformative 45-day program designed to empower Web3 startups by connecting them directly with their communities and industry leaders. Through a rigorous selection process, the top 10 startups are chosen to participate in expert-led mentorship sessions, KOL (Key Opinion Leader) activations for increased visibility, and virtual pitch sessions to engage with the broader community. This program not only amplifies community engagement, but also equips founders with the tools, networks, and strategies needed to scale their projects, all while staying true to the ethos of by the people, for the people.

Other projects have also successfully leveraged events to grow their ecosystems.

Example: Chainlink regularly hosts hackathons that attract thousands of developers globally. These events not only expand Chainlink’s ecosystem but also strengthen its developer community through innovation and collaboration.

Key Differences Between Investor Pitches and Community Pitches

Conclusion

In the Web3 world, pitching is about building relationships with both capital providers and co-creators. By understanding the unique needs of investors versus communities, and adapting your approach accordingly, you position yourself as a founder who not only understands technology but also the human dynamics driving adoption.

At TDeFi, we specialize in nurturing Web3 startups by providing incubation, mentorship, and strategic guidance to help founders navigate these dual challenges. Whether you’re refining your pitch for investors or building a thriving community, our team of experts is here to support you every step of the way.

Reach out to us today and let us help you craft compelling narratives that resonate with both boardrooms and community members alike.