While trying to decide how to post something profound to start the year, I came across this post from Ben Dyer at TechDrawl:
Ben talks about a few relevant things. He is an angel investor and he mentions the fact he looked at over 1000 deals in 2009. WOW!, that's 5 a day and the point is that in the Southeast, we have done a good job on the quantity of deals. But, now the focus has to turn to the quality of the deals.
Looking at more than 1000 deals sheds some great insight into those comapnies that are likely to make it and those that are not. Ben challenges us to think about when it's time to move on to the next opportunity.
I'll leave you to ponder your existential thoughts and share them with Ben on his blog post. It's the "quality" thing that caught my attention.
Ben is right about the need to focus on becoming more sustainable, even while you are raising capital and the point I'd like to add is this: Don't develop the perfect product. Rather, develop the product that delivers the basic value proposition your customers are looking for to solve their pain. This approach does a few things for you:
- It brings focus to the customer's pain
- It gets your product in the hands of users so the real feedback process can begin
- You don't spend time (and your precious capital) developing features that won't make a difference
- IT"S ABOUT THE CASH!!!! You get to the market earlier, which brings in revenue and captures market share, which builds value, which differentiates you among the other 999 deals Ben will look at in 2010.
Don't develop the product you want customers to have. Develop one that solves their problems and there is only one way to find that out....ask them....before you give them your solution. Once you know what they need, get it in their hands as soon as possible and sell, sell, sell!
If your solution does not solve a problem at a price customers are willing to pay, perhaps you are "dogfood.com" and that's how to tell when it's time to move on. (a nod to Guy Kawasaki...)
Bottom Line: 2009 was a tough year to raise capital. You still have to do it in 2010 but make sure you are focusing as well on getting into the market as soon as possible. That is the pathway to sustainability.