Beyond capital: How RedCore evaluates startups for strategic partnership

In this article, Oleksandr Briukhovetskyi, Investment Portfolio Manager at RedCore, explains the five-step evaluation process the company uses to identify startups with the greatest potential for strategic investment and long-term growth.

An investment decision is not based on intuition or a bet on a founder’s charisma. It is the result of a structured evaluation process that every application goes through, and which filters out the vast majority. Those who make it through receive more than just capital — they gain a strategic partnership with the RedCore business group, which knows how to scale businesses.

Here’s how the evaluation process works and what happens between the initial contact and the Investment Committee.

Step 1: Initial screening

During the first two days, we assess the fundamentals. Does the project have a working MVP? Is the business model clear? Does the startup fit our verticals — Game Providers, AI/ML, RegTech, or MarTech/Traffic?

This is where the majority of applications are filtered out. Founders often come to us with an idea but no product. The team is working on the project part-time while earning their primary income elsewhere. Or they evaluate it $10 million, despite having zero revenue.

With those fundamentals, we don’t move forward. We invest as a strategic partner, contributing not only capital but also expertise and infrastructure. We help build operational excellence and scale the business. That model requires a mature product and a team for whom the startup is a full-time commitment, not a side project.

Step 2: The scoring model

Projects that pass the initial screening move on to our scoring model. We evaluate them across five dimensions: market, product, team, economics, and risks.

Market. We assess TAM/SAM/SOM,  market trends and geographic potential. Is the market growing? Is there room for a new player? Most importantly, how does the team plan to capture its share of the market?

Product. Product-market fit is one of the key criteria. We look for early customers, evidence of market validation, and a clear understanding of the problem the product solves. At the fundraising stage, the absence of clear PMF signals is a risk indicator rather than a sign that the company is ready to scale.

Team. Relevant industry experience matters. In AI/ML, RegTech, Game Providers, and MarTech/Traffic, it’s difficult to build a sustainable business without expertise.

Economics. Unit economics must be transparent: CAC, LTV, gross margins, and the path to profitability. Vague assumptions don’t work here.

Risks. We assess technological, regulatory, operational, and any other risks that could limit the company’s ability to scale.

Every parameter is evaluated with scores. Projects with low scores are filtered out because they simply don’t fit our investment model.

Step 3: Product & technology

Every startup has a presentation. We look at the product architecture.

Is the codebase structured well enough to be handed over to another team? Is there proper documentation? Can the product scale, or will it break under the first few thousand users?

For AI projects, we evaluate the infrastructure: latency, cost per inference, and whether the benchmark claims are realistic. A demo may look impressive, but a production-ready product is a very different story.

Step 4: Finance

This is where we dive into the numbers. Many projects that looked solid in the earlier stages begin to fall apart here.

Unit economics must be clear. Founders should know their CAC and LTV, understand their burn rate and runway. If the forecast assumes 300% growth, where will those customers come from? How was the marketing budget calculated? Have real operating expenses been taken into account?

The cap table matters too. Unclear ownership structures, founder disputes, or verbal agreements instead of legally sound documentation all create unnecessary risk.

We understand that an early-stage startup may not yet be profitable. But the path to profitability must be clear, supported by specific milestones and measurable metrics.

Step 5: The investment thesis

The final stage is bringing everything together into a single investment thesis that explains why we should make the investment.

Does the project strengthen RedCore, and can RedCore strengthen the project? Can the startup leverage our products, traffic, and customer base? Do we see the potential for it to become a market leader?

If the answer to these questions is yes, the project moves to the Investment Committee. If even one of them raises significant concerns, we stop the process.

Every project has its own pace

Some projects move through the process quickly, while others require additional time. Extra meetings, deeper technical reviews, and regulatory due diligence are often part of the evaluation.

Every startup is unique. Our goal is to determine whether we can genuinely help the business grow. If we see alignment, we move forward. If we don’t, we say so from the start.

RedCore’s investment practice provides founders access to the business group’s clients, traffic, expertise, and technology. That’s why every project goes through a structured evaluation process. If you’re ready to take that journey, we’d love to talk.

If you’re building a project in Game Providers, RegTech, AI/ML, or MarTech/Traffic, submit your application to RedCore Team