Tuesday, September 27, 2011

Lesson #100: The Definitive Checklist for Startup Success

Over the last six months, I have shared many lessons with you on how best to build your startup.  Below is a checklist of the most important "must-haves" for any successful startup:

___  A good business idea--"secret sauce" solution to real world problem  (Lesson #1, Lesson #112)
___  A well-thought out business plan and recurring revenue model (Lesson #7, Lesson #78, Lesson #108 and Lesson #132)
___  A large and growing industry, where a big business can be built (Lesson #118)
___  A firm handle on current and future competition (Lesson #19)
___  Defensible barriers to market entry (Lesson #43)
___  An experienced board of directors or advisors (Lesson #12 and Lesson #45)
___  A deep network of colleagues in your startup ecosystem (Lesson #47 and Lesson #85)
___  A motivating and credible CEO (Lesson #14)
___  An experienced and backable start-up team  (Lesson #2, Lesson #27 and Lesson #83)
___  Appropriately compensated employees (Lesson #58 and Lesson #59)
___  Equity in hands of key managers (Lesson #9)
___  An entrepreneurial office culture (Lesson #13)
___  A healthy office environment with work-life balance (Lesson #18 and Lesson #55)
___  A religious focus on putting your customer first (Lesson #33)
___  The right product and pricing strategy (Lesson #20)
___  A profitable and tested "go to market" sales and marketing plan (Lesson #21)
___  Infectious enthusiasm and passion for business (Lesson #50)
___  A clear management focus on what you are building (Lesson #40)
___  Speed to market and knowing when to cut losses (Lesson #71)
___  Disciplined decision making skills (Lesson #87)
___  Flexibility to fine-tune model and navigate challenges (Lesson #8 and Lesson #31)
___  Persistence in goods times and bad (Lesson #29)
___  The right mix of intangibles that investors are looking for (Lesson #86)
___  Market timing and luck (Lesson #3)

And, more specifically, do not approach professional venture investors until you have acheived:

___  A good mix of the "must-haves" above
___  A sufficient proof of concept based on key milestones (e.g., revenues or visitor traction) (Lesson #122, Lesson #128)
___  Your planned go-to-market strategy tested and profitable (Lesson #120)
___  Meaningful customers under contract who would be solid references
___  A sizable pipeline of customers in the works
___  Key industry partnerships with brand-name marketing partners
___  Clarity you fit the types of investments your target investor makes
___  A fine-tuned elevator pitch, to get their attention
___  A credible "road map" for investor to realize 10x returns within 5 years (Lesson #140)
___  Realistic thoughts on potential exit options and buyers
___  A realistic expectation on valuation to attract capital (Lesson #32)
___  Clear handle on how much money you need, including cushion to last 18 months
___  Logical use of proceeds invested in future growth (not past debts)
___  A debt/equity investment structure that works for the investor (Lesson #109 and Lesson #116)

For this second list, please re-read Lesson #4--How to Raise Capital for Your Startup and Lesson #10--How Best to Approach VC's or Angel Investors.  And, be sure to watch this video presentation I made on How to Pitch Venture Investors.

So, keep this startup checklist handy.  If you check-off most of the items on the above list, you should be "off to the races" in building a winning business that should attract smart venture investors for your business.  Wishing you the world of success (and luck) in your entrepreneurial adventure.

For future posts, please follow me at:  www.twitter.com/georgedeeb

2 comments:

Wayne said...

After I have done everything on your list, how do I find the capital I need to get the business running?

Wayne Shrock, Founder and CEO
Continental Dove Lines, Inc.
Phone: 307-278-7273
Skype: wayneshrock
Email: wshrock114@aol.com
Web Site: www.continentaldovelines.com

George Deeb said...

Hi, Wayne. In the second to last paragraph above should be a good start. Lesson #4, How to Raise Capital. Lesson #10, How to Pitch VC's. Links above. Or just send me an email via the Red Rocket website and we can chat offline.