Just stop it – There is no secret

Really, Just stop it.

In the last 7 days I have a couple of experiences with quite dramatic contrast.  On the one had I have been asked for a number of people (I’ll call them Startup Groupies) for support in getting their pitch ready for investors.  On the other hand I have been for coffee with a number of highly successful entrepreneurs whom are now investing as well as getting new projects off the ground.   The discussion with both camps has been around getting technology based startup’s off the ground.

The main thrust of the successful entrepreneurs/investors was ; Ideas are almost meaningless, Execution is everything.  The process discussed for deploying a startup went along the lines of:

1. Select an idea  that you feel is worth focussing on.
2. Tip in some of your own money & time and flesh the idea out with some quality research to turn your good idea into a great idea.
3. Determine your desired goals for the project.
4. Protect your position.
5. Have appropriate partners (from your network)  to tip in some time, IP, assets, customers and or money.
6. Create a tangible product or service and business.
7. Validate the product (visit potential customers to find what what they like and don’t like).
8. Validate the business model (visit potential customers to find how to sell it to them).
9. Start operating the business.
10. Speak to investors already in your network if you need investment to help you scale.

The whole process runs on the smell of an oily rag and serious investors don’t get pitched to until you have a validated business that could probably survive without investor monies.

The main idea of the Startup Groupies was ;  a great idea well communicated is the key to success.  Their desired process went along the lines of :

1. Have a great idea.
2. Flesh out the idea with a  bit of web based research.
3. Prepare an elevator pitch.
4. Prepare a presentation and rehearse it.
5. Get referrals into Venture Capitalists.
6. Pitch for Investment.

Now I don’t know anyone that the Startup Groupie model has actually worked for.  Sure I have read tales from Silicon Valley of the hot pitch that won the money, however I also know that for every hot pitch invested in, there was another 5,000 pitches that failed to get any attention. By the way, those tales also occurred on the other side of the world in a differnet culture with a much higher level of affluence, not here where our venture finance community is much more risk averse and money is in shorter supply.

However with the successful entrepreneur/investor around 3 out of 5 business started-up turned out to be winners.

So a message for the Startup Groupies -  Stop thinking there is a secret to avoid really hard work financed on the smell of an oily rag.  Just stop it.

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