There are investors who have goals other than ROI (like social value, etc.) but first and foremost, most investors are looking for a large potential return. They look for that because they know that most of the startups in their portfolio will not return anything. So a small number in the portfolio must return a lot.
By large potential return, we mean making 10x to 30x on their investment in 4 to 7 years. With returns taking so long, and with most of the portfolio expected to return little or nothing, it takes that kind of large potential return to result in a reasonable overall return for the portfolio.
When an investor finds a potential investment that has high return potential, the investor is then evaluating risk. The high return opportunities that have acceptable risk are the investments that get considered.
And what risks come into play? From an investor perspective, these are usually broken down into 4 categories of risk:
1. Market risk: if you build it, will customers buy it?
2. Team risk: do you have the team you need at this stage,
and will you have the ability to build the team you'll need down the road?
3. Technology risk: is your team capable of building the
product or service?
4. Finance risk: is the business model financeable?
How do you reduce those 4 risks to an acceptable level? The biggest single step in that direction is to build the product, and get users (better yet, paying customers). That proves a lot about the market, your team, and the feasibility of the technology.