# Venture Pipeline and Gates

**Version 1.0**

The roadmap from idea to scalable venture, and the evidence required to pass each
gate.

**Design rule:** every stage has work in it, a date, and a gate made of evidence
rather than enthusiasm. A stage with a term but no deliverable is a waiting room.

## The six stages

| Stage | Duration | Vehicle | Equity | What it produces |
|---|---|---|---|---|
| **0. Signal** | Days | None | None | A named problem and a person who owns it |
| **1. Explore** | 30 days | None | None | One deliverable per party, and demand evidence |
| **2. Pursue** | 6 months | MC or fiscal sponsor | None | A working thing and a money event |
| **3. Form** | Weeks | New entity | Yes, once | A company with a cap table |
| **4. Field** | 6–18 months | The venture | Vesting | Delivered contract or paying customers |
| **5. Scale** | Ongoing | The venture | Dilution | MC's seat exits, venture stands alone |

## Gate 0 to 1: is this worth thirty days?

Someone names a problem they have personally felt or watched an operator feel, and
a second person is willing to spend thirty days on it. Explore costs nothing, so
the gate is low on purpose.

**Do not sign Explore with someone who will not name a deliverable.** That refusal
is the cheapest signal available and it is almost always accurate.

## Gate 1 to 2: Explore to Pursue

All three, or it is a stop or a single thirty-day extension.

1. **Every party produced what they named.** This tests the people and does the
   most work. Capacity claimed in a meeting and capacity demonstrated in thirty
   days are different numbers.
2. **Demand exists outside the room.** Five people who are not friends of the team
   described the problem in their own words, or there is a written expression of
   interest, a letter of intent, or money on the table.
3. **Every core seat has a name against it.** An unnamed Technical Founder seat is
   the most common reason a venture stalls at this gate.

## Gate 2 to 3: Pursue to Form

**Form when money requires an entity.** Any one of these triggers it:

1. A contract, award, or grant is available and requires a legal entity to receive
   the funds.
2. Revenue requires its own bank account and tax ID.
3. Someone is going full time and needs equity to justify it.
4. An investor requires a clean cap table.

### What does not require forming early

| Need | Covered by | New entity? |
|---|---|---|
| Bid a federal contract | MC's SAM registration and CAGE 11TF7 | No |
| SBIR or STTR | MC as the small business awardee | No |
| Receive a foundation grant | Fiscal sponsor at ~10%, or MC if the grant permits for-profits | No |
| Take tax-deductible donations | Fiscal sponsor | No |
| Hire a contractor | MC | No |
| Sign an NDA or teaming agreement | MC | No |
| Issue equity to a cofounder | Nothing else | **Yes** |
| Take institutional investment | Nothing else | **Yes** |
| Ring-fence liability away from MC | Nothing else | **Yes** |

## Gate 3 to 4: Form to Field

Administrative rather than evidentiary: bank account open, EIN issued, cap table
clean, founder agreements signed, IP assigned into the entity.

## Gate 4 to 5: Field to Scale

Both required.

1. **The thing works in the field.** A contract delivered and accepted, or paying
   customers at a level that covers direct costs.
2. **MC's seat has a permanent holder.** The succession obligation from the role
   taxonomy gets checked here.

Merge's position converts to a passive holding at this point. The studio stops
operating inside the venture.

## Why the gates are evidence and not dates

A date-based gate passes by default when the date arrives, which is how good-idea
meetings become good-idea quarters. An evidence-based gate can only be passed by
producing something. The dates exist to force the evidence question to get asked
on a schedule.

## Changelog

- **1.0** (2026-10-01) First published version.