Hello, entrepreneurs! In this post, I intend to provide some suggestions to those of you who are in the process of pitching your venture to prospective investors, based on my personal experience as a consultant working for major companies and as an entrepreneur:
- Do some research: Before you can really break into an industry, you need to become familiar with it. You might be experienced enough in technical matters but you lack expertise in business and other softer areas, and that is perfectly acceptable! Spend more time with people in the business and try to see how they work on a daily basis. Ask them all the questions you need to ask and try to see the world through their eyes. Also do some proper internet research about the market on: what is the budget your potential customer has to spend on your product/service, what drives their decisions, what are their interests, how familiar are they with the technologies you expect them to use?
- Be transparent: No startup is perfect; no scenario is the best. There will always be weaknesses and threats, and investors are aware of that, but if you omit them or avoid mentioning them it looks like you overlooked them and this does not help convince people that you can take control of a business. Just be honest and mention those issues that are out of your control and could threaten your business before someone else points them out for you. Even better, try to explain how you can fight or minimize their effects by using your strengths and taking advantage of opportunities. Do not be afraid to explain that you need to do further research on some aspect or that you need money to improve some weak area you are dealing with.
Do not underestimate users: As technical experts, there are many times when we think WE know what our customers will need better than they do. We take it for granted that they will think our product is super-cool and feel there is almost no need for them to give us their feedback. We welcome and celebrate those compliments and thumbs up we get from them, but categorically disregard the negative opinions or suggestions, alleging that the user probably did not understand our value proposition or might not know what they want. We just need to take a look at the most successful apps (Google, Facebook, Twitter) to understand that their first main goal was to attract users with useful tools, nice interfaces and reliable services and only after that, they started making a profit out of their traffic. Facebook did not start selling ads before it had many users; not until 2012, when it had 1 billion. It is true that users are always reluctant to change (especially those coming from traditional retail, finance and health verticals), but we need to do our best in order to offer a good value proposition and a fantastic user experience that can make their efforts to give our products a chance worthwhile. Try to see what things you can do better than your competitors’ or alternative products/services, and try to focus your surveys and user evaluations
– Agustin Baretto ’15 (MS)