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As mentioned in Jeff’s blog, we just released a pretty sweet video showing the excitement and value of our SpeedPitching luncheons. A lot of people have requested to attend as a spectator to see how it works, so here’s your chance.
Props to Joe Grover and his company Digital Mind Studios for putting together such a sexy video. Joe has been a great Junto Partner for the past 2 years and (as you can see) does amazing work.
We partnered with Sid Mohasseb (founder of Venture Farm and a member of the Tech Coast Angels) a few months back to put on a 2-day workshop on effective business execution. I spent the past 2 days participating in the workshop here in Costa Mesa, CA and here are the highlights:
Every entrepreneur should take the 2 days to go through the Venture Farm Institute workshop. It was a fantastic learning experience for me and everyone else involved.
Next on the list of “10 Signs of a Fundable Company” is 2-part: 1) Identify a target market, and 2) have a strong plan to penetrate that market.
Too often, entrepreneurs make a mistake by saying, “We are entering a $8 Billion market and all we have to do is get 0.1% of the market to make $8 Million in revenue!” There are 2 problems with this statement: 1) They are not referring to the Total Addressable Market and 2) they are taking a top-down approach to market penetration (which is very unrealistic).
Total Addressable Market: the precise market and customers that will purchase the product (not the entire market).
Once you have identified a market, the more important piece of the puzzle is to have a plan to penetrate that market. If you don’t have a solid market penetration strategy, you’ll have a hard time raising capital.
TIP: instead of selling customers one at a time, think about various channels or partners that already have relationships with many of your customers and sell through them. Investors love to see such a plan because you can penetrate the market much faster.
If you haven’t been to a FundingUniverse Speedpitching luncheon, Joe Grover and the crew at Digital Mind Studios put together a killer video clip that is as much an advertisement for Digital Mind as it is a great depiction of the event. Great work, Joe!
You have a great idea. You know it will be successful if you can get it out into the marketplace. But is your opportunity perishable?
Bill Payne, entrepreneur-in-residence at the Kauffman Foundation, explains an idea is perishable if it will “have no value unless commercialized in a limited window of time.” So what if your business idea could be classified as perishable? Bill offers a few suggestions.
1. Make sure the idea is both scaleable and fundable
2. Hurry, with patience
3. Consider shortcuts to the marketplace, such as development and/or marketing partners.
Bill explains, “It is always better to share a perishable idea and take a smaller piece of the pie than to see the window of opportunity disappear.”
Before investing in a company, it is important to know what type of exit strategy an entrepreneur is seeking. Whether through an IPO, a merger or acquisition, an entrepreneur should be able to convince you why and how they will exit.
Bill Payne, entrepreneur-in-residence at the Kauffman Foundation, explains this idea further. “Entrepreneurs must wear two hats, one as founder/employee and a second as an owner of startup companies. The founder/employee hat dominates the activity of the entrepreneur during the startup and operations of the company. But, the ownership hat is, in fact, more important to the entrepreneur, because a successful exit will have a lasting impact on the entrepreneur and his or her family. Successful entrepreneurs create wealth for their families; consequently, adequate attention to their ownership position in their companies is a critical but often overlooked responsibility of entrepreneurs.
Harvesting their ownership position is, in fact, their final and perhaps most important act as entrepreneurs. And executing the exit strategy is vital to the success of the investors. Consequently, a compatible exit strategy and harmonious execution of the harvest is in the best interest of both parties.”
I’ve spent the past two months watching the FundingUniverse AngelReady programs ramp up extremely quickly. While the process has been nothing short of exhilarating, I find myself faced with a growing challenge — a pressing, urgent, gut-wrenching responsibility to serve the explosively increasing number of entrepreneurs who are paying us to help them raise money.
It keeps me up at night. I have dreams that resemble a commercial from a few years back that featured a few people standing around a computer looking at an on-screen map as they launched a new product. At first, they celebrated as the first few orders popped up on the map. Then, as the number of orders on the map started popping up at an exponentially increasing rate, their celebration turned into panic as they rushed off to fill the orders. (If you can find the video, let me know so I can post it here.)
Fortunately, I believe we have the bandwidth to support the growth, so we’re far from panic mode. However, I don’t see an end in sight for this busy season at FundingUniverse. It’s going to be a wild ride.
At the 2007 Utah Technology Council Annual Members meeting on March 28, 2007, Brock Blake, CEO of Funding Universe, was recognized as the 2006 Emerging Executive of the Year.
Blake joined other distinguished 2006 Executives of the Year award recipients:
“I am humbled and honored to join such an elite group of successful executives,” Blake said.
Blake emphasized that while he is honored to receive the award, the recognition does not solely belong to him.
“While my name is recognized, this award is really a tribute to the hard work and efforts of the entire FundingUniverse team,” Blake stated. “I sincerely believe that. Our team is amazing. I am grateful to be a part of such a dynamic and talented group.”For the rest of the article, click here.
The next time you’re pitching an investor — whether it’s in their office, at an event, on the phone — repeat the following phrase 7 times before you walk in the door:
“I am selling my company, not my product.”
Pitching an investor is not the same as pitching a customer. When you pitch a prospective buyer, you want them to buy your product or service. When you pitch investors, you want them to invest in your company.
As with a good sales pitch, you want to cover the strongest points of the product that you are selling. While pitching your company, the points that are most interesting to the vast majority of investors are the traction you’ve made (sales, patents, past rounds of capital, sales and sales), your management team, market size/need and your business model. If you can convince them that these four elements of your business are rock-solid, it doesn’t matter what your product is. You’re likely to find success raising money.
The tendency of most entrepreneurs is to spend the majority of their pitch telling the investor everything about his/her product — how it works, how they thought of it, why it’s better than the competition. Of course it’s important to describe your product or service to investors, but it’s should take up no more than 2/5 of your presentation.