Senior Marketing Manager
The fault, dear Brutus, is not in our stars, but in ourselves.
– William Shakespeare
Because a high percentage of startups fail, entrepreneurs are clearly making some pretty costly mistakes somewhere along the line. Let’s hear about mistakes entrepreneurs can avoid. Here are some tips straight from Amber Rae on Fast Company’s blog. She discusses five mistakes that her entrepreneur friend, who recently launched a water filter business, will never make again:
- Deciding on partners or cofounders too early
- Not firing fast enough
- Trusting experts, rather than your gut
- Settling for “good enough” instead of pushing toward ideal
- Caring about hype, not revenue
Our CI investment team couldn’t resist chiming in. Here are a few additional mistakes they’d like to point out:
- Not understanding what your customer wants
You may have a very cool and exciting technology, but do your customers want it? If they don’t, you’re sunk. You need to do some research early on with prospective customers and measure their level of interest before investing countless hours and resources in development and marketing.
Being unable to articulate what problem your product or technology solves
Investors, in particular, will want to hear a clear, focused and concise description of what problem your innovation solves. They’ll also want to know how you can turn the innovation into revenue quickly.
Neglecting to do your homework
This covers a gamut of things, but we’ll use the example of pitching to investors. You need to find the right
investors to pitch to. Investors have different foci and sweet spots, and you need to research which ones are a potential fit for your venture. Otherwise, you’ll waste valuable time – your time and theirs.
Trying to do it ALL yourself
We find that many entrepreneurs don’t ask for help and want to take on all aspects of running a business themselves; they can’t rely on anyone else to do things right. Well, all you Type-A folks out there, you’re just going to have to loosen up a bit and… delegate! One person cannot do it all. Entrepreneurs must leverage resources by delegating to other staff (setting expectations and then measuring performance/results later) as well as advisers, board members, investors and trusted service providers.
Good nuggets to file away as you launch your new venture…!
While Connecticut Innovations’ risk capital/equity investment team focuses primarily on assisting homegrown technology entrepreneurs and startups, we are stepping up efforts to reach out to and recruit entrepreneurial ventures residing beyond our borders – in the U.S. and other countries. We have been active in recruiting and relocating new ventures for many years, so we will build on that experience in the months ahead. In the past five years, we have recruited 19 companies from six states and four foreign countries. Last year alone, we recruited six companies to Connecticut.
Yesterday we announced our investment in one of these companies, Advent Technologies Inc. (Advent), which is in the process of relocating its headquarters from Athens, Greece, to East Hartford, Connecticut. The company also plans to establish R&D and manufacturing operations here in Connecticut.
We welcome Advent, a developer of innovative renewable energy technologies, to Connecticut and look forward to assisting the company as it settles into its new home in East Hartford.
To learn more about Advent, see our CI press release and the Advent website.
Russell E. Tweeddale
Managing Director, Investments
First launched in January, CI’s TechStartSM Fund was created to spur technology innovation and business formation by providing initial capital of $25,000 to entrepreneurial teams. The intent of the funding is to allow startups to pursue the viability of a technology concept or business and determine whether additional funding might be obtained to launch a business.
The initial nine teams selected for funding participated in a 10-week TechStart accelerator pilot program that started on March 5. The program provided the teams with mentors, professional resources, and guidance in launching a new business. At the conclusion of the program, the teams pitched to a large turnout of investors and garnered high interest.
CI is now ready for round two. In the coming weeks, CI will be following up with applicants, investors and mentors in an effort to facilitate collaboration and further strengthen the program. The Fall 2012 TechStart schedule is as follows:
– Applications Open – June 15
– Early Application Deadline – Aug 1
– Application Deadline – Aug 15
– Finalist Presentations – Aug 29
– Notification of Selection – Early Sept
– TechStart Accelerator Program Begins – Sept 17
This time, the TechStart Accelerator Program will run for three months in New Haven.
Learn more about TechStart in our press release and read all of the program highlights and criteria for both the TechStart Fund and the TechStart Accelerator Program on our website at www.ctinnovations.com/TechStart.
Program Analyst, Business Development
The VentureBeat blog recently featured a valuable checklist of important legal considerations for startups. The list appears in a blog post authored by attorney Scott Edward Walker, founder and CEO of Walker Corporate Law Group PLLC. Walker, who has been a corporate attorney for more than 17 years, crafted this list based on common mistakes he’s seen startups make.
The list is worth reviewing if you are contemplating launching a new technology venture.
President and Executive Director
The recently released Startup Outlook 2011 report, produced by Silicon Valley Bank, summarizes responses and perceptions of 375 U.S.-based high-tech startup companies. The results are encouraging but shed light on areas where the business ecosystem could be a bit more business friendly.
Of the companies surveyed, 83 percent plan to hire this year. This is great news, particularly as this number is up by 10 percent compared with last year. The report also notes that the companies believe “business conditions have improved and are improving further.”
However, startups are concerned about the regulatory and political environment (e.g. new regulations, healthcare reform, etc.) and access to equity capital; they view these as “their largest impediments to growth.”
Greg Becker, CEO of SVB Financial Group and Silicon Valley Bank, notes that the data in the report “clearly shows that technology companies met or beat their 2010 revenue targets, are still experiencing improved business conditions and are creating U.S. jobs. There is no question that the innovation sector is making a tangible impact on the U.S. economy and our ability to compete globally.”
To read more about the Startup Outlook 2011 report and access it directly, click here.
President and Executive Director
View comments / leave a comment
There is encouraging news for entrepreneurs who launched new businesses during the current recession… Their firms tend to show “resilience in job creation and durability.”
In an article published recently by the Ewing Marion Kauffman Foundation, Robert E. Litan, vice president of research and policy at the Kauffman Foundation, notes, “Even starting a company during a recession adversely affects the new firm for only a limited time…While a recession has a negative effect on a company’s employment in its first few years, a recession does not impose lasting consequences on startups…Firms started during the current recession can expect their employment to catch up with longer-term companies in the years to come.”
Read more in a new study by the Ewing Marion Kauffman Foundation, “After Inception: How Enduring is Job Creation by Startups?”
President & Executive Director
View comments / leave a comment