by: Geoff Ficke
Want to Kill a New Business Opportunity? Avoid These 5 Often Repeated Mistakes
I review new Business Opportunities for a living. My Consumer Product Development and Marketing Consulting firm is besieged with presentations, Executive Summaries, product prototypes and Business Plans. It is a tribute to the ingenuity and creativity of people that the urge to invent is so common. Unfortunately, very few of the projects we review will ever see a retail store shelf.
The reasons for this dismal rate of project demise are broad and endless. However, there are a few mistakes that we see repeated over and over as small businesses, entrepreneurs and inventors seek to secure limited investment and product placement opportunities. Social media sites are replete with examples of innovators handicapping their efforts and hard work because they do not properly present their work.
The following are five of the most vivid and commonly repeated mistakes that entrepreneurs commit when approaching investors or potential project collaborators:
1. The Web-Site is up, but I do not have a product yet!
This has become a golden oldie since setting up a web-site has become so easy. If you have a truly commercial product idea, but the idea is still a concept only, why would you telegraph the idea to competitors? There are corporate trolls that do nothing but search the internet looking for ideas and interesting but underfunded products to rip off. It pays to be a bit paranoid. Having a web-site with nothing behind it is a signal that a non-professional is managing the project.
2. Stating a specific investment need before completing all due diligence!
When my Venture Capital and Investment Banking associates see a Business Plan that requests a specific, round figure funding tranche their hackles go up. These round number requests always indicate a lack of depth in performing essential due diligence. I write Business Plans for my clients and would never waste a sources time by submitting any document that was not fully documented and supported with assumptions that could be fully qualified, quantified and excitingly narrated.
3. I have been working on this project for 8 years!
Say no more. Successful entrepreneurs are doers. Unless you are attempting to cure breast cancer, or put a mouse on Venus, a long running Consumer Product Development is indicative of a lack of commitment. No one will want to become involved in a project that is going to meander along, rudderless and without the passion and drive required to achieve success.
4. I have a billion dollar idea and no money!
Many people dream about achieving success and enjoying the freedom and success that entrepreneurship can provide. If you truly have a great concept or product there are ways to bootstrap the idea. The “billion dollar” idea comment is a “tell” that you are dreaming and unrealistic. Many people have little or no monies to invest. Just do not lead off your dance card by telling the pretty girl that you are broke.
5. Investors love my idea but won’t invest!
No, they do not love your idea. Maybe they do not love you. Many first time entrepreneurs hear what they want to hear. The hunt for resources is intense and incredibly competitive. Venture Capital, Investment Capital, Merchant Bankers, Angels and blind pools consist of people who are successful and know potential success when they see it. If you have the right stuff you will be recognized and supported, but it will not be easy or a straight line.
We see these defects displayed every day when being approached by prospective entrepreneurs. On social media sites we see the same people continually stumbling about, blindly hoping lightning strikes. Lightning strikes the earth every minute of every day. I have just never been able to know exactly where and when the strike will occur so that I could corral it.
Geoff Ficke has been a serial entrepreneur for almost 50 years. As a small boy, earning his spending money doing odd jobs in the neighborhood, he learned the value of selling himself, offering service and value for money.
After putting himself through the University of Kentucky (B.A. Broadcast Journalism, 1969) and serving in the United States Marine Corp, Mr. Ficke commenced a career in the cosmetic industry. After rising to National Sales Manager for Vidal Sassoon Hair Care at age 28, he then launched a number of ventures, including Rubigo Cosmetics, Parfums Pierre Wulff Paris, Le Bain Couture and Fashion Fragrance.
Geoff Ficke and his consulting firm, Duquesa Marketing, (www.duquesamarketing.com) has assisted businesses large and small, domestic and international, entrepreneurs, inventors and students in new product development, capital formation, licensing, marketing, sales and business plans and successful implementation of his customized strategies. He is a Senior Fellow at the Page Center for Entrepreneurial Studies, Business School, Miami University, Oxford, Ohio.