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Startup Validation: Difference between revisions
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==== Workflow ==== | ==== Workflow ==== | ||
* How is the team working together? How do you imagine the company will work together? (Remote, in-person etc.) | * How is the team working together? How do you imagine the company will work together? (Remote, in-person etc.) | ||
* How are important decisions taken? How do you split work? | * How are important decisions taken? | ||
* How do you split work? | |||
* Are there core beliefs or principles that shape your work? | * Are there core beliefs or principles that shape your work? | ||
* Do you have one official managing director/ceo? | * Do you have one official managing director/ceo? | ||
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* Do you have strong established partners and service providers e.g. law firms to work with? | * Do you have strong established partners and service providers e.g. law firms to work with? | ||
* With whom are you working? | * With whom are you working? | ||
* How much budget | * How much budget do you allocate to different functions? | ||
==== Budgeting ==== | ==== Budgeting ==== | ||
* What costs did you have over the last years/months (since inception)? | * What costs did you have over the last years/months (since inception)? | ||
* Do you have a | * Do you currently have a budgeting plan? Are you willing to share it? | ||
* If you are not cash flow positive do you know how long your cash will last before you need to cancel the project? e.g. 9m month run away cash. | * If you are not cash flow positive do you know how long your cash will last before you need to cancel the project? e.g. 9m month run away cash. | ||
* How much money are you planning to raise in your next round? How are you planing to spend that cash? How much runway will you have | * How much money are you planning to raise in your next round? | ||
* How are you planing to spend that new cash? Do you already have concrete mapped out budget plans and projections? How much runway will you have? | |||
* Do you see a way to grow faster (or more sustainably) by making certain investments (hiring developers, hirings sales reps, advertising)? | * Do you see a way to grow faster (or more sustainably) by making certain investments (hiring developers, hirings sales reps, advertising)? | ||
* Are you planning (costly) investments in the near future? (Capex) | |||
* Do you currently receive a salary? What will your salary be after a successful funding round? | * Do you currently receive a salary? What will your salary be after a successful funding round? | ||
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* Where do you want to be in 5 or 10 years? | * Where do you want to be in 5 or 10 years? | ||
* How do you see your further growth journey? (e.g. further VC-Rounds, Exit) | * How do you see your further growth journey? (e.g. further VC-Rounds, Exit) | ||
* How fast do you need to grow in order to succeed? | * How fast do you need to grow in order to succeed? How long do you think the window of opportunity will stay open? | ||
* How soon can you achieve profitability? How much do you want to optimize for profitability? | * How soon can you achieve profitability? How much do you want to optimize for profitability vs. growth? | ||
* Which kind of longterm margin do you think is realistic? Why? | * Which kind of longterm margin do you think is realistic? Why? | ||
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* Which % marketshare do you think you can obtain and hold longterm. Why? | * Which % marketshare do you think you can obtain and hold longterm. Why? | ||
* How much revenue did you generate so far? | * How much revenue did you generate so far? | ||
* How much realistic revenue can you generate within your current step | * How much realistic revenue can you generate within your current step one niche/vertical/strategy? | ||
* | * Do you have expansion plans beyond that? Which verticals are you going to tackle next? When will you tackle those verticals? | ||
* What are you revenue growth projections? What kind of assumptions, targets, kpis did you set yourself? What is currently the limiting factor for growth? | * What are you revenue growth projections? What kind of assumptions, targets, kpis did you set yourself? What is currently the limiting factor for growth? | ||
* How do you market your product? How high are your Costumer acquisition costs and costumer lifetime value? | * How do you market your product? How high are your Costumer acquisition costs and costumer lifetime value? | ||
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==== Competition & Moats ==== | ==== Competition & Moats ==== | ||
* What is the endgame in your market? How strong are network effects? How much consolidation are you expecting to see? | * What is the endgame in your market? How strong are network effects? How much consolidation are you expecting to see? | ||
* What is the most valuable resource in your business? What will be the deciding factor which businesses are going to be successful | * What is the most valuable resource in your business? What will be the deciding factor which businesses are going to be successful in your market? | ||
* How will one business be able to take market share from the other? (Better product, pricing etc.) | * How will one business be able to take market share from the other? (Better product, pricing etc.) | ||
* Which types of moats are you hoping to build for your business? | * Which types of moats are you hoping to build for your business? | ||
* Are there any moats that competitors have which are not obtainable | * Are there any moats that competitors have which are not obtainable by you? | ||
* What are power dynamics between different | * What are power dynamics between different participants in your market? (e.g. between you and your vendors/partners and costumers) Is this visible by the way contracts are structured? | ||
* What are your two biggest direct competitors and who are your two biggest indirect competitors? | * What are your two biggest direct competitors and who are your two biggest indirect competitors? Do they already have similar products on the market? Are you seeing any similar products? | ||
* Which type of players are you seeing as your most serious challengers in the next years? | * Which type of players are you seeing as your most serious challengers in the next years? | ||
==== Clients & Partners ==== | ==== Sales (Clients & Partners) ==== | ||
* How much revenue are you targeting per client? | * How much revenue are you targeting per client? Will this revenue be one time or recurring? | ||
* How many potentially clients/partners did you already had talks with it? | * Does your business model depend upon collaborating with certain business partners? | ||
* Do you currently have clients/partners signed? If yes which ones? Which kind of conditions did you agree upon? | |||
* | * How many potentially clients/partners did you already had talks with it? Is it difficult to identify and start conversations with potential new clients/partners? | ||
* What are your conversion ratios at different stages of your sales funnel? | |||
* What are major hurdles you are facing in your conversion process? | |||
* How many different clients/partners do you need in order for your business to succeed? | * How many different clients/partners do you need in order for your business model to succeed? | ||
* How large is the pool of potential clients/partners you can work with? Which % of them do you need to sign in order to succeed? | * How large is the pool of potential clients/partners you can work with? Which % of them do you need to sign in order to succeed? | ||
==== Regulatory ==== | ==== Regulatory ==== | ||
* Which regulatory challenges are you or the industry facing? | * Which regulatory challenges are you or the industry facing? How fast is the regulatory environment changing? | ||
* How can you solve those challenges or even provide a solution for them? | * How can you solve those challenges or even provide a solution for them? | ||
* Are you able to fully comply with regulatory demands or do you need to take certain regulatory risks? | * Are you able to fully comply with regulatory demands or do you need to take certain regulatory risks? | ||
== Investmentcase & Exit == | == Investmentcase & Exit == | ||