Last week, a friend reached out asking for help evaluating a startup investment from the perspective of someone who hadn’t done it before. Normally, when thinking about a startup investment, the standard topics such as the quality of the founding team, the market opportunity, and the value delivered to the customer are the go-to attributes.

It’s fairly easy to talk to the founders, hear the pitch on how they’re going to change the world, and conduct an interview similar to any other potential professional relationship. Of course, the best founders are great at both selling themselves and selling the vision, but it’s often hard to know what’s real and what’s hopeful. People who are good at sales are good at selling themselves, so it can be difficult to truly evaluate them.

On the market opportunity front, there’s often a lot of talk about the total addressable market (TAM) and the serviceable available market within the TAM. The idea is that the market has some overall value (for example, cars) and the startup is going after a subset of that value (for example, electric cars). Most of the time TAM is presented as a large number, but in many cases it doesn’t represent the actual opportunity. The best opportunities are small, fast-growing markets that you believe will be big in five to seven years but are too small today for larger companies to care about.

Now consider one of my favorite factors: the value of the product to the customer. This is commonly overlooked because it’s easy to say, “This type of business will get value from this type of product.” In reality, it’s wildly different when comparing a must-have product, such as an accounting system, to a nice-to-have product like a small productivity widget. The challenge is that it’s hard to know how valuable a solution really is to a prospective customer.

So what should you do? Start with primary research. Read The Mom Test by Rob Fitzpatrick. Study the techniques for assessing the quality of an idea via the market and how to interview prospects without leading the witness. Then use your own network to reach out to potential buyers and assess the quality of the idea and the potential market independently of the founders. If it’s promising, ask the founders for introductions to a couple of their customers and run through a similar set of questions to understand the value they are receiving.

While this might seem like overkill, the vast majority of startups fail, and the number one reason is that the product isn’t compelling enough for people to change their behavior. As a potential angel investor, if you can personally conclude that the startup’s product is incredibly valuable to the customer, the chance of a successful investment goes up considerably.

Most people are used to simpler forms of investing, such as using a Robinhood account to buy a share of Google. Angel investing is a hundred times harder to do well, and those willing to put in the effort will do much better.