Think It Through

I ran across this article a day or two ago which contains some good advice, from somebody who's in the business of investing in startups, Stu Phillips of Ridgelift Ventures. He writes that one of the most common problems he sees, with new ventures and small business', is "failure to think things through."

A good list of common issues:

• How does the product fit into the customer's environment?
• What is the sales strategy - how do you make more on the sale than it costs you to get.
• What is the likely response of your competitors (especially if they are large and profitable – read well armed!)?
• How is value built for the investors (M&A or IPO)?
• What is your contingency plan when things (inevitably) go wrong?
• What do you need to do to raise the NEXT round of investment at a better price than the current round?

The point is that this thought process takes place BEFORE problems arise.