The Why Now / Who Cares Test
Screen an early bet with four questions: why now, who cares, what if right, what kills it.
- Difficulty
- Moderate
- Time to result
- ~weeks to results
- Steps
- 6
- Confidence
- 85%
This is Sequoia's standing set of screening questions for an early-stage bet, and its power is in the order. First, why now: almost every idea has been tried before, so find the prior attempt and name the specific change — mobile phones in every pocket, an on-demand workforce, AWS — that makes this attempt viable when the earlier one was not. Second, who cares, both today and in ten years, because the firm partners at the idea and seed stage and needs the company to matter a decade out. Third, the imagination question: if everything goes right, what does this become? Fourth and last, the pre-mortem. The sequencing matters because failure modes are easy to enumerate and always available, so putting them first crowds out the harder work of dreaming the upside.
Origin
Don Valentine's habit of asking 'who cares?' about any new company, extended at Sequoia into the why-now and everything-goes-right questions Alfred Lin describes running on every early-stage investment.
Core principles
- 01An idea failing before is evidence about timing, not about the idea.
- 02The enabling change must be nameable and recent, or there is no why now.
- 03Early-stage bets are underwritten on what the company becomes in a decade, not on today's numbers.
- 04Imagining the upside is harder work than listing the risks, so it needs to be forced.
- 05Writing the pre-mortem is cheap; it is the everything-goes-right memo that is scarce.
How to run it
- 1
Find the graveyard
Locate the earlier company that tried this and failed. Establishing that predecessors exist is the starting point, not a disqualification.
Pro tip If you cannot find a prior attempt, look harder — the idea is rarely new, only the conditions are.
- 2
Name the enabling change
State exactly what is different now: a technology, a behaviour, a cost curve, a newly available workforce. The change must be specific and recent.
Pro tip Demand a mechanism, not a vibe — 'everyone now carries a smartphone' beats 'the market is ready'.
Watch out Sometimes there simply is no good why now. Say so and move on rather than inventing one.
- 3
Ask who cares today
Identify who is genuinely served right now and how acutely. This is the sanity check on whether anything real exists yet.
- 4
Ask who cares in ten years
Project forward to whether this is an important company a decade out. At the seed and Series A you are underwriting the decade, not the quarter.
Pro tip Ask what the world looks like if this company wins — if nothing meaningful changes, it is not important enough.
- 5
Write the everything-goes-right memo
Force yourself to describe what the company becomes if each thing breaks its way. This is deliberately done before the risk work.
Pro tip Have the deal's sponsor paint the picture out loud to the group; conviction is transmitted, not tabulated.
Watch out Skipping this and going straight to risks is how firms systematically pass on the biggest outcomes.
- 6
Write the pre-mortem
Now list how the company dies and what the major risks are. Note how much easier this was than step five — that asymmetry is the point.
Watch out Do not let the pre-mortem's easy specificity outweigh the upside case simply because it is more concrete.
In the wild
Grocery and instant delivery had both been tried and failed: Webvan on groceries, and a company called Kozmo that opened in New York in 1999. The test does not ask whether the idea is new — it asks what has changed. The answer for Instacart and DoorDash was mobile and the on-demand economy. People have always wanted instant gratification; what did not exist in 1999 was the ability to summon an on-demand workforce, because not everyone was carrying a mobile phone. That is a nameable, specific change, which is what separates a real why-now from a fashionable sector.
→ Sequoia backed both Instacart and DoorDash into a category littered with dead predecessors.
A founder pitches a business identical in shape to one that failed a decade earlier and, asked why now, answers that the market is much bigger and that AI is changing everything. Neither is a change specific to this business. Run the rest of the test anyway: who cares today produces a thin answer, and who cares in ten years produces a company that is a feature of somebody else's product. The everything-goes-right memo comes out modest while the pre-mortem writes itself in minutes. That asymmetry, not any single risk, is the pass.
→ A clean, explainable pass that took an afternoon rather than three months of diligence.
Common mistakes
Doing the pre-mortem first
Failure modes are always easy to write and will crowd out the harder imaginative work. Order the questions so the upside case gets written while your mind is still open.
Accepting a sector as a why now
'This category is hot' is not an enabling change. Without a specific new capability or behaviour, you are underwriting fashion.
Answering who cares only for today
A product with real users today can still be irrelevant in ten years. Early-stage capital is priced on the decade, so the ten-year answer is the binding one.
Is it for you?
Best for
Anyone deciding whether to back, join or start something years before the evidence exists — investors, operators evaluating a new bet, founders pressure-testing their own idea.
Not ideal for
Late-stage or growth decisions where the market is already established and the question is share and efficiency rather than possibility.
From the transcript
“The simple questions are you you've heard before is why now?”
“The other question we ask all the time is in 10 years, why who cares about this company?”
“In the early stages, it's easy to spot why the company may fail. And it's quite easy to write the pre-mortem of a company.”
From the episode
Special: Sequoia Capital's Investment Playbook (with Alfred Lin)