The Why
Behind Tractor Ventures

I never liked the term “unicorn” for fast growing tech companies. For starters, it sounds childish and as we all know, unicorns don’t exist.

I always preferred the analogy of a rocket ship. They do exist, and when built well can do amazing things for all the people involved, and humanity.

Rockets have a downside, that is, they’re complex and hard to build making them expensive. There are lots of risks that must be overcome during the build process and if any one of them can’t be overcome, or worse still the unknowns accrue and are discovered at launch time then the success of the rocket is consumed in an explosive and unsuccessful end.

When applying this analogy to tech companies, the eventual moon or mars landing is the definition of success, where the whole team and all the investors can revel in their hard work and deployed capital and take their winnings. The problem is that the barrier is very high, and that stops most people from even starting the build. Many a rocket has exploded during lift-off. The test launches, the knowledge of the engineers, the ability to find and sell customers on the dream all need to align with only a few missteps along the way. Everybody took big bets and the big outcome was the goal.

The problem is, the world doesn’t revolve around rocket ships. Sure, they’re aspirational and exciting and I watch every time SpaceX does something new but in between those launches and landings is regular life.

Back on earth, people need to get shit done. And more and more people are realising that grinding out repetitive processes in the office is not a great life. The software companies whose products improve day - to - day operations of businesses are not rockets, they’re the tractors of the startup ecosystem.

Tractors, though less exciting than rockets, are the real workhorses. They’re reliable but most importantly, they optimise for efficiency in the workplace. The horse and cart, the steam tractor, the diesel tractor and now the automated, satellite driven, super accurate tractors are the way that real businesses move forward and achieve profitability.

The tractors are understated but business owners appreciate their impact and importantly, because they have a direct and measurable impact on the bottom line, are happy to pay for on a recurring basis. Tractors get embedded into workflows and quickly become critical to the businesses that use them. Tell a farmer that he can’t use a tractor any more and they’ll likely get very upset.

Building a tractor isn’t free, but for founders who have deep experience in the problem they’re solving, they’re much cheaper than rockets. Founders can quite often prove the value of their new tractor to potential customers by building, and selling, the part that is most impactful to their customers’ business. It’s also likely they know enough potential customers to build a tractor that works for lots of customers, instead of just one.

These founders are the perfect archetype for Tractor Ventures. We’re supporting, championing and funding the founders who are building important tractors for customers where once they know it exists, they cannot do without them.

What rocket ships do is exciting to everyone, what tractors do is exciting to their specific set of customers. Great tractor companies may be hidden in plain sight, solving a problem so common to their customers normal folks are blind to their value. While initially focussing on a much narrower audience, the thing we know about people who found startups that look like tractors is that they eventually sell lots of tractors by earning trust and the right to talk to more customers by delivering results.

The beauty of selling tractors is that even the first one is useful to customers who are happy to pay for them, so while it might take a long time to build up a business that has sold a lot of tractors, that business can be mostly funded from customer revenues rather than risk capital.

Tractor Ventures will find, fund and support through knowledge and connections the best tractor builders that have already built and sold some tractors but need $150-500k in funding to strongly focus on the next set of customers. Our builders will be writing impactful software that is likely to be classic SaaS and are able to onboard and support new customers without incurring costs at the same rate. They’re software companies who are truly efficient at what they do! They are software companies led by people who can’t go back to their old job as the problem they’re focussed on just won’t go away. These leaders are driven and methodical founders, they are no less ambitious than rocket makers, they want to be the best in their field, they’re just selling to a slightly smaller and more focussed set of customers, for now.

And finally, when we land on Mars, it’s the tractors that build the next civilisation and we’ll be here for them.

Read our values to get a feel for how we see the world.

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