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MenuIs my business idea feasible? Please give me feedback for letting me know the weak points of my idea.
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The application you're describing is probably useful, and can probably be sold... but that's not the question :)
The question is what it will cost you to acquire a new customer, and what you can charge that customer.
Before actually BUILDING this thing, see if you can get 10 potential customers to at least SAY they're interested. In exchange for their feedback during the development process, offer them free use of the product until it's released, and then for a year thereafter. If you can't close that sale, then either you or your product has a problem.
If you CAN get a handful of customers to agree to this "free participation as a development partner" arrangement, then move on to step two: get yourself a HUNDRED signed up. This is a larger number than you can pursue manually, which means you'll have to develop your sales pitch as a landing page on a website, figure out what language will be effective, decide where to advertise, and so forth.
Again, if you accomplish this, then you're very well along the way to making this project feasible. But if any part of the above seems impossible, or too expensive, or too confusing or scary, then don't bother wasting your time creating the system.
In other words, I'm saying you need to test whether you're capable of building a marketing engine to support the sales of this concept. I *assume* you're capable of creating the underlying product, but that's far from the only challenge.
I hope the above was helpful, and of course do feel free to look me up for a call if you'd like to discuss further.
I've launched a few businesses and projects and worked in startups for years so hopefully my insight is somewhat valuable. :)
This sounds like a good idea, but I think there are two questions you need to answer:
1. Is there any competition?
2. If not, why is no-one else doing this already?
If this isn't being done already it's probably because it's very difficult as this definitely seems like a good idea. If I understand correctly you're attempting to build a marketplace. I'm in the process of building a marketplace and have worked in a marketplace startup in the past. I can tell you it's extremely difficult because you have to market to both the supply side (advertisers) and the demand side (app developers).
Targeted Ads: if you're going to be bringing in advertisers to show their ads in mobile apps you're going to have to take into consideration the fact that each app may have a very different audience. That means you will need to customize which ads are displayed in which apps, which introduces a whole extra layer of complexity to your system.
Ease of Use: This needs to be extremely easy for the advertiser, customer and developer. If it's not easy for any one of the three groups it will not work.
Proof of effectiveness: Both the advertiser and the developer need to know that your system works. That means building in reporting, and probably tracking conversions for both the advertiser and the developer. Not an easy task by any means...
Pricing: This is extremely important. How do you make money? Make sure your incentives align with both sides of the marketplace. The developer wants to maximize payment they receive for displaying advertisements and the advertiser wants to minimize their cost to acquire a customer. You need to make sure that the better you do at meeting their incentives the more money you make. It will encourage you to build a better system and reward you for giving your customers what they need.
Last, but certainly not least, evaluate and see if there is reasonable way you can do this leaning on existing advertising networks. If you can minimize the work on the supply side (getting advertisers) it will greatly increase your chance of succeeding. Once you have a strong network of developers you can always go out and recruit your own advertisers.
If you want to chat more let me know and we can schedule a call. :)
You're asking for a lot of someone's time and expertise.
I'd recommend you book a call with an expert in the various areas of your business plan and invest a few dollars into flushing it out.
At a quick glance, your business plan is pretty thin. I'm a marketing consultant, so I'll pick on that: what you have isn't a plan. There is no actionable step or direction.
There is a need within in the industry for the service you're proposing, but, based on this outline, it won't get off the ground.
I encourage you to commit some additional time and resources to create a MVP - minimum viable product - that you can start with. This will give you a better sense whether your proposal is feasible.
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I have this social media idea,but no coding skills. How do I get someone to do the coding (cant afford to pay them) and not give away half of my idea?
Dilip was very kind in his response. My answer might be a bit on the "tough love" side. But that's for you to decide. My intention, just for the record, is to help you (and those like you) on your path to success. And that starts with having a viable philosophy about entrepreneurial-ism and business. And I'm going to answer this because I get asked some form / version of this question very frequently from newcomers to entrepreneurial-ism. The scenario goes something like this: "I have a great idea. It's amazing, I love it, and I just KNOW it's gonna make me a ton of money. But I have no money right now so I can't afford to (fill in the blank with things like "to build it / create it / market it / etc" or "to hire the required staff needed to work in my business to sell it / develop it / etc"). And I don't want to tell anyone about my great idea because I'm worried someone will steal it and make MY million / billion dollars. But I can't afford to legally protect it either... So how do I launch without the skills to personally create the product AND no money to hire anyone else to do that either??" The answer is ... You don't. Look - let's be honest. All you have is an idea. Big deal. Really. I'm not saying it's not a good idea. I'm not saying that if properly executed it couldn't make you a million / billion dollars... But an idea is NOT a business. Nor is it an asset. Until you do some (very important) initial work - like creating a business model, doing customer development, creating a MVP, etc - all you really have is a dream. Right now your choices are: 1. Find someone with the skills or the money to develop your idea and sell them on WHY they should invest in you. And yes, this will mean giving up either a portion of the "ownership" or of future income or equity. And the more risk they have to take - the more equity they will want (and quite frankly be entitled to). 2. Learn how to code and build it yourself. MANY entrepreneurs without financial resources are still resourceful. They develop the skills needed to create what they don't have the money to pay someone else to do. 3. Get some cash so you can pay someone to do the coding. You'll probably have to have some knowledge of coding to direct the architecture of your idea. So you will likely still have to become knowledgeable even if its not you personally doing the coding. (This is not meant to be a comprehensive list of options... And I'm sure some of the other experts here on Clarity have others to add - and I hope they do) To wrap up - Here's my final tip to you that I hope you "get"... It's FAR more valuable to have an idea that a very specific hungry crowd is clamoring for right now - One that THEY would love and pay you for right now - Maybe even one they'd pre-order because they just have to have it - Versus YOU being in love with your own idea. [Notice I didn't say "an idea that some as-of-yet-undetermined market would probably love"] I wish you the best of luck moving forward.DB
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What is the average series A funding round at pre revenue valuation for a enterprise start up w/cutting edge tech on verge of our first client.
With all respect to Dan, I'm not seeing anything like that. You said "pre-revenue." If it's pre-revenue and enterprise, you don't have anything proven yet. You would have to have an insanely interesting story with a group of founders and execs on board with ridiculous competitive advantage built in. I have seen a few of those companies. It's more like $3m-$5m pre. Now, post-revenue is different. I've seen enterprise plays with $500k-$1m revenue/yr, still very early (because in the enterprise space that's not a lot of customers yet), getting $8m-$15m post in an A-round. I do agree there's no "average." Finally, you will hit the Series A Crunch issue, which is that for every company like yours with "cutting edge tech" as-yet-unproven, there's 10 which also have cutting edge tech except they have customers, revenue, etc.. So in this case, it's not a matter of valuation, but a matter of getting funded at all!JC
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What companies have successfully implemented both B2B and B2C products or services? Which should I start with for the non-profit sector?
I would suggest the first question to ask is "what problem do I solve?" And of those people I solve problems for "who do I create the most value for?" In the non-profit world you need to add "How does my business help the non-profit run better and/or help the group the non-profit focuses on?" For example, if you've created a platform that drives donations, your company "has created a platform that helps you reach fundraising goals faster." What you don't want to do is market and sell to B2B and B2C audiences simultaneously. They have different ways of buying - a B2B audience needs to have their benefits quantified (using your thing makes me x amount more) - and it's extremely hard for a startup to be able to do both well. Better to start with one, execute really well and move into the other. Feel free to give me a call and we can dig into who your most valuable audience is.AV
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How much equity should I ask as a CMO in a startup?
Greater risk = greater equity. How likely is this to fail or just break even? If you aren't receiving salary yet are among 4-6 non-founders with equivalent sweat investment, all of whom are lower on the totem pole than the two founders, figure out: 1) Taking into account all likely outcomes, what is the most likely outcome in terms of exit? (ex: $10MM.) Keep in mind that 90%+ of all tech startups fail (Allmand Law study), and of those that succeed 88% of M&A deals are under $100MM. Startups that exit at $1B+ are so rare they are called "unicorns"... so don't count on that, no matter how exciting it feels right now. 2) Figure out what 1% equity would give you in terms of payout for the most likely exit. For example, a $10MM exit would give you $100k for every 1% you own. 3) Decide what the chance is that the startup will fail / go bankrupt / get stuck at a $1MM business with no exit in sight. (According to Allman Law's study, 10% stay in business - and far fewer than that actually exit). 4) Multiply the % chance of success by the likely outcome if successful. Now each 1% of equity is worth $10k. You could get lucky and have it be worth millions, or it could be worth nothing. (With the hypothetical numbers I'm giving here, including the odds, you are working for $10k per 1% equity received if the most likely exit is $10MM and the % chance of failure is 90%.) 5) Come up with a vesting path. Commit to one year, get X equity at the end. If you were salaried, the path would be more like 4 years, but since it's free you deserve instant equity as long as you follow through for a reasonable period of time. 6) Assuming you get agreement in writing from the founders, what amount of $ would you take in exchange for 12 months of free work? Now multiply that by 2 to factor in the fact that the payout would be far down the road, and that there is risk. 7) What percentage share of equity would you need in order to equal that payout on exit? 8) Multiply that number by 2-3x to account for likely dilution over time. 9) If the founders aren't willing to give you that much equity in writing, then it's time to move on! If they are, then decide whether you're willing to take the risk in exchange for potentially big rewards (and of course, potentially empty pockets). It's a fascinating topic with a lot of speculation involved, so if you want to discuss in depth, set up a call with me on Clarity. Hope that helps!RD
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