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Journey from an idea to business


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This is an interesting 5-M Model to evaluate whether a new business idea hold the potential to become a sustainable business. It also shows the process and stages of angel investments.

Published in: Business
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Journey from an idea to business

  1. 1. Journey from an Idea to a Sustainable Business The Steps, Challenges and some Quick Tips
  2. 2. The Steps Early Stage Funds / Crowd - Funding Idea Idea Initial Scaling up Evaluation Incubation/ Market Prototyping Feedback 5 M test Incubators PE/VC Funds
  4. 4. Mmmmm…
  5. 5. Mmmmm…• Movement• Marketability• Management• Monetisation• Mitigation
  6. 6. Mmmmm…MovementAbility of the idea/business to attract consumers and scale up reach• Does the service/concept holds ‘real value’ for its targeted consumers• Will it ‘Lead’ the markets for tomorrow and holds the potential for creating disruption• Will it attract even the competition to look up at it• Will it attract other vendors to create an ecosystem around itWe don’t want USD 0 Million ideas……we want USD 0 Billion ideas
  7. 7. Mmmmm…Movement • Versatility and ease of usage • Innovative form factor • Moving the ecosystem • ‘Viral’ potential • Enabling other value-adds
  8. 8. Mmmmm…Movement • Emerging middle class with no time to shop for kids • Brands willing to offer support • Travel industry growing by huge leaps • Convenience of use
  9. 9. Mmmmm…MarketabilityAn idea may move people…but will people really give their money to take it• Is the timing right?• Can existing distribution networks support the product/idea• Is the product a ‘Me-Too’ or just small incremental difference from existing options• Product demand estimates / benchmarks• Who are your consumers – and do they have wherewithal to buy the service?• Has the idea being sample marketed?
  10. 10. Mmmmm…ManagementWe invest in people…and its people who make or break a business• Domain specific experience• Complementary team skills• Experience of mentors, if any• Other associations – such as working partners• Right resource planning
  11. 11. Mmmmm…MonetisationIt’s all about the money, honey!• Initial projections – careful analysis of expenses and revenues – for one year• What are your revenue streams• Value – Cost analysis• Usage of Funds
  12. 12. Mmmmm…Monetisation MythsSome ‘Danger Signs’ you should look at• We will get Million eyeballs – and hence Million dollars in advertising revenue• The Founders will take salaries home• We will grow 200% by year 2• Our break even will be achieved in less than a year• We will exit in year 4
  13. 13. Mmmmm…MitigationPlan without risk-analysis is the biggest Risk!• What risks do you foresee – and how do you foresee mitigating them• How well-equipped are you…or will need to be…when risks arise• Pessimistic market projections – worst case scenario
  15. 15. Stages of InvestmentWhere does one invests• Have an idea• Investigate the market• Creating a prototype• Demo of product & services • Solid business plan • Interested clients • Some initial sales • Key Management in place
  16. 16. Stages of Investment…Where does one invests• Success in market place• Hiring sales, marketing & operations team• Office & manufacturing space• Purchase of further equipments • Growing quickly • New production facilities • Invest in marketing • Product development • Fire fighting, keeping the wheels on
  17. 17. Evaluation ProcessStart FUNDING Opportunity Negotiation Due Diligence Introduction Initial Screen • Valuation • Management • Presentation • Management • Ownership • Marketing • Executive Team • Control • Production summary • Business Plan • Management • Financials • Forecasts • Legal Contract
  18. 18. Thank you !Satish KatariaConsultant - DARECybermedia India