After exploring the Entrepreneur’s wish list from VCs and How can VC funds differentiate themseleves, VC Cafe asked European and Israeli VCs for their wish list from entrepreneurs, or in other words, what should entrepreneurs be doing more or less of, to maximize their chances of success. Big thanks to everyone who collaborated on creating this list.
This is not yet another list of ‘how to be an entrepreneur’. There’s plenty of those out there, from much smarter and experienced people than me. Reid Hoffman’s ???list of 10 rules of entrepreneurship, for example, captures the gist nicely. These are general guidelines for technology entrepreneurs to consider, when pitching an early stage venture to investors.
1. Talk to customers – you’re not going to solve their problems unless you really understand what they are. Have you talked to 10 of your users about their experience before this pitch?
2. Focus your efforts and plan on how you can reach a large customer base at a cost-effective manner. Two point in this one. One is focus, and the other is being nimble, which means small, capital efficient, and flexible.There’s plenty of ways to keep costs low in the early stages of the business. For example, shared office space, outsourcing tasks to cheaper resources online, buying used equipment, ect.
3. Honesty/ Integrity. Be open, honest & frank about what you (& your company) do well & what you don’t. VCs aim to work with people they respect and admire as people – not just for their technical or business abilities. Being a straight shooter and being fair – in dealing with VCs, startup employees and partners is hugely important. Humility is a great asset, too :)
4. Focus on the user, but don’t lose track on your numbers. What are the numbers that drive your business, what KPIs do you measure, etc.
5. Carve your niche, but think BIG – big problems, big market, big ambition – if you shoot for the moon you may have a chance to see the stars (cheesy, but true). In a recent inteview to Business Insider, Philip James, co-founder of private wine sale startup Lot18, shows exactly what a ‘big niche’ is:
“I know that wine is a big market, I founded Snooth. So many people are like, well it’s kind of a niche product.
That’s fine, but it’s a $30 billion niche. It’s bigger than music, it’s bigger than Hollywood, and it’s bigger than DVDs and cinema. I guess you can call that a “niche.”
To be continued in part 2…