Having been paid to write business plans, I’m always interested in the parallels between launching start-ups and selling new products.
A young Aussie entrepreneur here provides his checklist of 10 reasons investors don’t invest in start-ups.
- Inexperienced management team
- No proof of concept
- No cashflow
- No understanding of valuation
- No clear path to exit
- The business in its current form is not scalable
- No strategic value
- Lack of focus
- Growth path not identified
- No understanding of points one through to nine
Whilst perhaps not the best constructed list of its kind (is point ten really serious for instance?) several of these points not only provide relevant checks for any business plan, but also relate well to a new product push.
Why would a potential customer ‘invest’ in your fresh wares if you didn’t have ‘proof of concept’? Or you don’t know the true ‘strategic value’? Or couldn’t show how you’d scale up?