This Is What VCs Looking For When Making Investment
Ever wondered what’s on VC’s mind when they trying to analyze your startup?
Venture capital (VC) do a lot of research to generate insight about you and your business. They has set their own goal, and of course it’s safe to say that they most likely to look whether you’ll help them reach the goal or not. Though there are many various opinion, but great founders, market, and product, are the most important considerations. Here’s why:
VCs look for the founder who want to change the world, people who will do something big. Ambitious founders are needed to tackle big problems. Moreover, VC’s look for people with raw mental horsepower. Jobs, Gates and Zuckerberg are sample of some brilliant people who get the world within their grasp. And investor want those criteria to see. VCs don’t only invest in a company or product but also in people who run the company. Founder is the top importance on this thing.
And then the market. VCs look into ultra-fast growth businesses that can returns their capital in the end of the day. In B2C startups, for instance, they will consider the motivation of the consumer to really want to use the product or service. A major reason why companies failed, is that they are tend to aim either far too small market, or even the market doesn’t fit the product. This is why startups have to know who their market.
After that, enter the product itself. Eventually you’ll deliver the product as a solution to the market, it’s the core yet it’s not the only consideration. Backed up by great entrepreneur could twist a so-so product become an actual winner in market for some occasion. Not to mention the differentiation needs in order to overcome any potential major competitors.