Guest Author: Gary Jinks
Many entrepreneurs and startups do not understand the fundamentals of the “startup/entrepreneur” business model. As a result, they fail to deliver the right message to investors- and ultimately do not get funded. “Why You” is not because you have a great app or technology. A common mistake of entrepreneurs is too much focus on the product, technology, or engineering and not nearly enough on the business or “how are you going to succeed?” Your ability to deliver your value proposition and plan clearly, concisely, and with confidence is what gets you funded. Executing your plan is what gets you funded again.
In the same way traditional and franchise business models have their unique characteristics, so does the “startup/entrepreneur” model. It is based on explosive growth through private investment, not long term growth through debt (traditional) or buying an established infrastructure and branding (franchise.) It is critical to understand the investor/company relationship and how it affects ultimate goals and direction. More than 90% of funded startups have an acquisition strategy.
Sell your product to customers and your business to investors. Investors are not buying your product; they are investing in your team to make money. They must understand the opportunity, how you plan to successfully capture a piece of it, and must believe you can deliver.
“Alpha, Beta, MVP, and Launch” is not a plan. Nothing says “invest in us” more than knowing what you are doing, when you are doing it, and how much it costs. Many startups lose credibility with a poorly constructed plan that does not show the coordination between Product Development, Business Development, Operations and Funding Strategy. You must go beyond product development and exhibit business development, go-to-market, and funding strategy. How does it all fit together in your plan?
The Value Proposition
For investors, your value proposition is generally not your product. In most cases it is a combination of the team, the plan, and the product- in that order. Delivering your value proposition clearly and concisely is critical. You cannot get funded if you cannot communicate “why are you the right choice?” You must be able to do this using the “industry tools”- the one page Executive Summary and the Pitch Deck.
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President, GLJ Group
Managing Director, South Valley Angels
Gary is a dynamic speaker who blends a mixture of detailed and relevant information, insight and humor in a compelling and entertaining format. During his 20 year corporate tenure, Gary developed complex advanced technologies, managed multi-million dollar budgets, and developed high performance teams. As owner and president of GLJ Group, Gary has generated more than $300 million in new business for his clients. As the founder and manager director of South Valley Angels, he has worked with hundreds of entrepreneurs and early stage companies to develop their business and go-to-market strategies, plans, and launch. Gary’s unique perspective comes from his experience in startups, Systems Engineering, Operations, Business Development, and Project Management.