Posts tagged ‘customers’

Focus on Customers Even When Seeking VC Dollars

March 3rd, 2009 by Greg Boutin
MaRS Discovery District, Toronto, Canada This ...
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I came across those two recent powerpoint presentations on venture capital and I thought they were nicely exposing some of the business inner workings.
The first one is by Jason Mendelson, a VC with the Foundry Group and Mobius Venture Capital, and was recommended to me by Hank Neyming. The second one is from Charles Plant of MaRS Discovery District, the innovation hub in Toronto. Charles communicates a rather negative view of venture capital, but it has the merit of presenting some of the important things to consider before seeking VC money. I especially like the call to focus on customers first. This is not always possible, but designing for a defined market certainly is, and anyone involved with tech commercialization will tell you it’s often the exception rather than the rule.
Overall, both presentations remind us that valuation is more of an art than a science, and a compelling business case is your best weapon to maximize it and obtain favorable conditions from VCs. A tangible business proposition and revenue model should be embedded in any venture early on, and refined as things evolve.
View more presentations from rosscarlson. (tags: vc venture)

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As Paths to Commercialization Narrow, Canadian Biotech Calls for Help

February 23rd, 2009 by Greg Boutin

My friend Fred Sweeney of VG Partners pointed me to this interesting call for help by the biotech industry in Canada, whose start-ups are finding it difficult to raise money to survive, let alone thrive. In these times of hardships, the ventures with the least obvious path to commercialization and revenue are the ones who suffer first and most. Given the lengthy development cycles and uncertain payout, biotech ventures evidently stand at the frontline of the crisis.

What all that shows is that a start-up should at all times be able to articulate the revenue model it is proposing to pursue. It should tie all its current efforts to this model, or “reverse-engineer revenue” as per the expression I coined at GrowthRoute. Doing just that provide three benefits: one, you stand in first row against competing start-ups when comes the time for VCs to hand out cash; two, keeping your eyes on the prize helps you identify where to focus your efforts today, and better allocate your current resources; three, spending some time thinking about how you will make money could point to nearer-term sources of revenue you may not have thought of.

Without a destination and a map to get there, you can have a tight ship and yet run it in circles. Better to never count on the government to get you back on track.

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