I regularly come across new startups as part of my scanning activity.
I’m also frequently approached (mainly on Linkedin) by new startups looking for investment which is thinly veiled as seeking my advice as a mentor.
The majority of them however don’t appear to have done their homework and don’t actually have a clue what I do for a living now or what I have spent years doing.
In a nutshell, I track TIPS – Technologies, Innovations, Patents and Startups and I use this research to help my clients build the future.
I am frequently approached for my opinion by a wide variety of organisations and I have a reputation for being quite vocal ….. which results in me regularly speaking and hosting panels at the likes of Money2020, Trustech (where I’m MC for the opening plenary sessions kicking off in Cannes later this month), CES (where I’m hosting a Blockchain session at the Digital Money Forum in Las Vegas in January), The Financial Services Club (where I’ll be talking about Igniting Innovation Initiatives in December) and a myriad of “behind closed doors” sessions with clients.
Whenever I come across a new startup proposition I go into full blown toddler mode – relentlessly asking “why” in order to try to figure out if they are likely to become one of the approximately 2 out of 10 startups that will make it past their 3rd year – the most common failure reportedly stemming from a lack of proposition validation / lack of product market fit.
Their first round of funding has usually come from “friends, family and fools” and you will not believe the number of relatively well bootstrapped but ultimately doomed propositions I come across where this group of people do not understand the market, the technology, the value proposition or indeed the go-to-market strategy and effort it takes to launch a successful startup. They are frequently caught up in the hype of buzzwords and the charismatic capability of the founder or co-founding team to sell them a dream based on a credible demo and thanks to InVision it’s pretty simple for anyone with a modicum of skill to make a really credible demo these days.
I’ll leave my own post-mortems for a future post.
When the sh*t gets real and they start looking for Angel / VC money, they occasionally find a few more “fools” that will be sucked in by hype but my clients and connections generally fall into the “sophisticated investor” category – they tend to do their own due diligence in order to come to an investment decision – which occasionally involves asking for my opinion.
If you’re unable to articulate a compelling differentiation between your proposition and the rest of the crowded startup market out there then maybe you should take a leaf out of Simon Sinek’s book and “start with why” – because I don’t care about your “how” OR your “what” you are going to do until you can answer that one, single question succinctly.
Photo credit: Foter.com (modified with permission)