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Hot market, shorter pitch
In ordinary times, the pitch is a beautiful, entertaining story with analytical numbers woven through it. It dissects the chess match so completely that the founder reaches QED, the Latin shorthand for proven, and no question remains about the winning formula.
In a super cycle, the same rigor reads differently. A two-hour QED presentation should probably shrink to 45 minutes, because it looks like too much, and a founder risks talking himself out of the deal. Investors start to wonder why anyone is so detailed and whether something is wrong.
The reason is the time horizon. The further into a super cycle, the further ahead the pitch looks, three to five years out, with a possible 100x inflection. No set of numbers can prove that. So the pitch becomes the theory of the case, and stories of entrepreneurs who sit down around a table with an idea and walk away with money are the opposite of QED.
Why do hot markets reward big stories?
The economist Frank Knight distinguished risk from uncertainty in his 1921 book Risk, Uncertainty and Profit. Risk can be measured from past data, while true uncertainty cannot. A pitch aimed three to five years out sits mostly in the second category, so a detailed model gives only an appearance of precision. Knight argued that profit comes from bearing uncertainty.
Why do mathematicians write QED?
QED stands for the Latin quod erat demonstrandum, meaning "which was to be demonstrated." It translates a Greek phrase that Euclid used to close proofs in the Elements. Latin translators carried the phrase into Western mathematics, where it became the traditional ending. The mathematician Paul Halmos popularized a small filled square, called the tombstone, as a replacement in the 1950s.
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