Here! This checklist has been borrowed, to a large extent, from Steve Blank, the serial entrepreneur (see Standford Technology Ventures, Quarter Roundup: what did we learn, Fall 2009).
- Idea: What’s the idea? New tech? Industry has changed? Regulation has changed? Existing market but you can be faster and cheaper?
- Innovation: Where is the innovation? Technology innovation vs. market innovation.
- End-user: who is the end-user? The decision maker ? The guy who pays you? Google users are not the payers. In the B2B space, the following happens all the time: the user is the marketing division; the decision maker (to buy) is the IT division; the guys who pays is the CEO, from his ‘special topics’ budget. Also segment, segment, segment! And think about the use case.
- Competition: who are the competitors? Do you want to be the only one in the market? Typically you don’t want to be the first mover. You want to be the first fast follower (e.g. google, amazon, ebay etc). Who could put yourself out of business in the first 18 months? Yourself! It’s all about execution
- Sales: What’s the channel to reach the customer? Channels might change over time.
- Marketing: how do you create end-user demand and drive that demand into your sales channel?
- Business Development: what does business development do? Deals? Sales? Partnering? Strategy?
- Business / revenue model: how do you organise your company to make money? Where does money change hands?
- IP / Patents / Regulatory issues: How and how long? If you were in biotech, it can take 10 years to go through all the approval processes. If you are Coca Cola, do you need a patent for your Coke drink?
- Time to market: how long does it take to get to market. Remember: things cost twice as much and take twice as long
- Product development model: how do you engineer it?
- Manufacturing: what does it take to build?
- Seed financing: how much? When?
- Follow-up financing: how much? When?
- Liquidity: how much? When?
When you work on your business plan, you will not initially have answers to all these questions – and some of these questions might only be answered in the execution phase. But eventually, you will need answers to all these questions. Otherwise, your business will probably be dead.