Not too long ago, the best thing a start-up could do to find investors was to get other investors to vouch for it. But, today, the value of “social proof” has been significantly diminished.

1. Blame AngelList for an Advisor Bubble

Every company I see has some roster of advisors and/or soft-circled seed investors already committed. It’s gone from evidence of company traction to merely an execution step before hitting ‘publish’ on the AngelList profile.

The prominence of “Advisors” on the AngelList profile has artificially inflated the perceived value of attracting “name brand” confidants. This, in turn, has resulted in an advisor bubble, where people are constantly getting asked to “advise” in exchange for a small amount of equity (Naval at AngelList has mentioned looking at a better way to present this information on site). Often advising means very little beyond “let me put you in the investor deck.” [Personally, I’ve started to not disclose my relationship with some companies in order to allow us to focus on the product not a recognizable avatar for their About page]

As a result, most savvy investors are starting to discount (or at least push on) the value of an advisory board unless the founder can articulate why that’s important. For example, a friend of mine is building an app with a very specific target market. Within this market there’s a name or two that would really help him build credibility with customers, and thus he’s pursuing a strategic advisory relationship.

2. Abundance of Dollars

So many investors. Angel investors, incubators, early stage funds, later stage funds with seed side funds. And they’re all spreading little bets everywhere so any one of them deciding to back your company is less differentiated than prior.

3. Maybe Social Proof Doesn’t Work?

My personal experience is that the angel investments where I relied more on social proof, rather than on than my own direct relationship with the team, have been less productive (both in terms of returns and fun). So while investing syndicates are cultivated over time, the happenstance moment-in-time collection of a handful of investors seems to not add much value, especially when it’s a first-time entrepreneur. I’d go so far as to say a party round for me is now a negative signal in many deals because the lack of a lead investor suggests there might not be a single individual who really has a personal stake in the outcome.

A Quora question on whether social proof works as an investing strategy has an interesting answer from Naval who notes that if all investors rely upon social proof it changes the nature of the marketplace.

So if you’re a founder, don’t worry as much about signaling. Figure out who you want to work with, have a great rationale for involving them and then build a relationship.

For angel investors, if you don’t have time to actually understand a company and are just following social proof, you’re better off becoming a LP in an early stage fund and letting them do it for you.