I review new Business Opportunities for a living. My Consumer Product Development and Marketing Consulting company is littered with presentations, executive summaries, product prototypes, and business plans. It is a tribute to the ingenuity and creativity of the people that the desire 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 project disappearance rate are vast and endless. However, there are some mistakes we see repeated time and time again when small businesses, entrepreneurs, and inventors seek to secure limited investment and product placement opportunities. Social networking sites are full of examples of innovators hurting their efforts and hard work because they don’t properly present their work.
The following are five of the most vivid and commonly repeated mistakes entrepreneurs make when approaching investors or potential project partners:
1. The website is live, but I don’t have a product yet!
This has become a thing of the past since setting up a website has become so easy. If you have a truly commercial product idea, but the idea is still just a concept, why would you telegraph the idea to competitors? There are corporate trolls who do nothing but search the internet for interesting ideas and products but with insufficient funds to scam. It pays to be a little paranoid. Having a website with nothing behind it is a sign that a non-professional is managing the project.
2. Declare a specific investment need before completing all due diligence!
When my Investment Banking and Venture Capital associates see a Business Plan that requests a specific, round-figure funding tranche, their hair stands on end. These round number requests always indicate a lack of depth in performing essential due diligence. I write business plans for my clients and I would never waste sources time by submitting a document that is not fully documented and backed up with assumptions that can be qualified, quantified and excitingly narrated.
3. I have been working on this project for 8 years!
Do not say more. Successful entrepreneurs are doers. Unless you’re trying to cure breast cancer or put a mouse on Venus, long-running consumer product development is indicative of a lack of commitment. No one wants to get involved in a project that is going to wander, rudderless, and without the passion and drive necessary to achieve success.
4. I have a billion dollar idea and I have no money!
Many people dream of achieving success and enjoying the freedom and success that entrepreneurship can bring. If you have a really great concept or product, there are ways to push the idea forward. The comment of the “trillion dollar” idea is a “say” that you are dreaming and that it is not realistic. Many people have little or no money to invest. Just don’t start your dance card by telling the pretty girl that you’re broke.
5. Investors love my idea but won’t invest!
No, they don’t love your idea. Maybe they don’t love you. Many first-time entrepreneurs listen to what they want to hear. The search 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 things, you will be recognized and supported, but it won’t be easy or simple.
We see these flaws displayed every day when we are approached by prospective employers. On social networking sites we see the same people continually stumbling around, blindly waiting for lightning to strike. Lightning strikes the earth every minute of every day. I have simply never been able to know exactly where and when the attack will occur so that I can pin it down.