11 Questions For Start-Up Entrepreneurs
Concept of creative idea and innovation, Unique, Think different, standing out from the crowd.
1. What problem are you trying to solve?Do you know exactly what problem companies or individuals – and you – are trying to solve? Do you know what the absence of solutions costs today? How much would companies and individuals pay for your solution?
2. Is it a big problem or a small one? How big is the market for your solution?It’s important to tackle large markets. While niche markets can be fun – and sometimes very profitable – it’s smarter to develop products and services for larger – and growing – markets with a unique product or solution..
3. Has anyone else tried to solve the problem? How are they solving it? Have they been successful or unsuccessful? Why?Due diligence here is paramount if for no other reason than investors who conduct their own due diligence will find every one of your competitors. So you – the entrepreneur – must beat them to the punch – every time. Details about competitors is essential. What went right and what went wrong with the companies that have attacked the same market you’re after? It’s not only necessary to identify the competitors, it’s important to be able to recite their stories.
4. What’s your unique solution to the problem? What are the barriers to entry?Is it technology-based? If so, what’s so different about your technology solution? Do you have any current or pending intellectual property (IP)? What else is unique about you, your team, your technology and your plan? There needs to be a list, and ideally a long one. Can your solution be easily copied especially by deep-pocket large competitors? Or is it difficult to copy (beyond any IP)? How crowded is the space? The last thing you want to do is develop a product pr service than can be quickly and easily copied. First-mover advantage is almost always temporary. There’s a reason why Tesla’s market share is shrinking.
5. Is your “solution” a product or a service?Describe the unique features of your product or service: is it incremental or disruptive? You must erase all ambiguity here – at least as you launch. Over time, of course, everything will change, but clarity here is important not just for market testing but for investor confidence.
6. What are your founder strengths – and weaknesses?Why is your team solid? What is their product or service experience? Has it been successful or unsuccessful? What specific aspects of your entrepreneurial personality are critical for success and which will threaten it? Can you be objective about your strengths and weaknesses? Are there truth-tellers on your team?
7. How much money do you need to execute?How much to launch, how much to an MVP and how much to scale? These estimates are, of course, just that, but they must be tied to investments, projects and processes. There must also be clarity. Uncertainty – even though the whole launch estimation process is uncertain – is dangerous, since investors need a number (even though they too understand how squishy the number is).
8. Describe the projects and milestones necessary to launch?List the projects by name, tasks and (ideal) outcomes. Slates of projects not only help your investors understand where you’re going, but they also help you and the team understand what must be done. Make no mistake, the project identification and description process is a learning drill unto itself.
9. What are the revenue projections? What are projected expenses? What are the risks?Remember everyone will assume your revenue projections are hypotheses. The market will decide whether or not there's real revenue in your products or services. That said, you should provide revenue ranges with probability outcomes based on some data that’s reasonably well-sourced. Expenses are also hypotheses – and usually under-estimated. Risks straddle revenue and expenses and are almost speculative, but still must be provided even if they’re only best guesses. One of the major mistakes entrepreneurs make is to provide data around revenue, expenses and risks they present as “factual.”
10. What’s the fundraising plan? How many fundraising relationships do you have?The fundraising plan must be credible based on existing relationships you have with investors. Chase those relationships first promising that they’re the first and only ones you thought about calling as your start-up launched. If anyone smells that you’ll be cold-calling investors they’ll run for the exits. How persuasive is your pitch? Is it investor ready? Who are the pitch targets? What’s the pitch schedule?
11. How’s the pitch?The pitch itself must be short and compelling – and persuasively delivered. Find the best actor on your team – or anywhere. Find the best writer on your team – or anywhere. Find the best graphic artist on your team (which might be DALL-E or Midjourney) – or anywhere. Remember that pitching is performance art. Remember that pitches must adapt to the audience. Great salespersons, amazing pitchpersons, mesmerizing actors, captivating artists are all required to generate investments in your company.
If you can’t answer all 11 questions you’re not an entrepreneur – and you’re not investor-ready either. By the way, you need to answer all of these questions in 11 slides or less with a serious dose of videos, demos and stories embedded in “the pitch.” Presenting 11 dead PowerPoint slides may – should – get you thrown out of the room.
Source:
https://www.forbes.com/sites/steveandriole/2024/01/28/11-questions-for-start-up-entrepreneurs/?sh=653fd487da3d
