Posted by: David Croslin
angels, Funding, innovation, invention, Startups, Venture Capital
I have talked to thousands of startups over the last 15 years. And most of them make mistakes that dramatically limit their overall potential for success. An unbelievably small fraction of startups succeed and there are good reasons why.
A lot of us have come up with new ideas. The more we think about our new idea the more we expand the idea and define how the idea will be developed, deployed and sold. Eventually, we have a fully fleshed out vision of the future for our idea.
Now that we have a vision of our idea’s future implementation, we want to make it real. And that is when many startups begin to fail.
Presenting a complete vision of a product to investors with no intermediate marketing stages often will result in little or no funding. The risk of failure is too high. And the longer the time period is needed to bring the vision to market the more likely it is that the market will shift and the product will no longer deliver the same dreamed about market impact and resulting revenues.
Developing a complete vision with no intermediate marketing stages makes the assumption that the startup’s founders have a complete understanding of the potential consumer’s needs and wants as well as the optimal packaging and presentation of the product. Many startups deliver complete vision products to market only to discover they have made invalid assumptions or that new competitor’s products have shifted the consumer’s expectations.
I know of startups that have actually turned down funding because the founders of the startup felt that the investors did not ‘fully understand the vision and might limit the vision’. After years of searching, these startups have yet to receive funding under the terms of the ‘vision’. Many of these startups will probably never get funding and their vision will never be realized.
The same thing happens to many (most? ALL!) established companies. Millions of dollars and years of development time are spent on products that when brought to market are a complete failure. If the product had been staged more appropriately the company would probably have identified the issues early on and been able to shift the development path to a more appropriate vision.
A complete vision can sometimes lead to complete blindness.
This is #5 in a series of 50 mistakes that startups make.
I am looking for a company that I can work with on their road to success.
I am the former Chief Technologist at Hewlett-Packard and the Chief Product Architect at Verizon. I hold 25 granted patents that are referenced by over 400 other patents. I have started five companies and driven them to success. I have two startups in stealth. I was on the M&A committees at HP and Verizon.
Drop me a note or connect with me: firstname.lastname@example.org