Billhighway Nonprofit Financial Management Solutions

Steve Robert, Billhighway CIO, shares advice for start-up entrepreneurs.

I had the distinct pleasure of being a judge at the recent Startup Weekend Detroit, which took place at the newly renovated Madison Building downtown, home of Detroit Venture Partners.  While every Startup Weekend is unique, a couple things stood out to me this time around – first, the space, which as successful entrepreneur Dug Song rightly puts it “Detroit’s Madison Building is the best startup office I have ever seen, from SF to Boston, Boulder, Austin, Shanghai, London, Tokyo, Zurich.”  Second was the crowd, each event gets bigger & better with more and more new faces.  I spoke with several people from out of the area, including Chicago and Philly, some having moved away from Detroit after grad school and referencing they wished this community existed a couple years ago, they may not have left!  There’s no doubt, the startup environment taking shape downtown is infectious.

As this was my 3^rd time judging, I’d like to offer the following to aspiring entrepreneurs.

1. Avoid creating another “me too” product, unless you can demonstrate a significant gap in their offering and a barrier to entry, you’re going to get eaten alive.  You should aim to bring something really useful and new to the market – something that people say to themselves “oh, wow, I’d consider paying for that.”
2. Get as many strangers (ideally potential customers) as possible to give you feedback. If you can’t offer a demo, a brief interview will suffice.  Listen carefully.  Validate what’s minimally required to address their pain and how much they’d consider paying for it. Customer signups, deposits and pull-ahead sales can add notable momentum going into the presentation.  Judges want to see evidence of potential customers, market research, focus groups along with anticipated acquisition advice
3. Explain how your team is uniquely skilled and able to execute on your idea.  Don’t be afraid to get personal, show passion, highlight the interest, dedication and capabilities your team has in solving the specific problem.  Relevant IP/domain knowledge is extremely helpful (but not necessarily required) and confidence never hurts.
4. Describe what you believe it will take to get your business to $1-3M in revenue.  This helps prove you’ve thought about how this could be possible, how many customers you’d need, how much they might pay, what investment(s) may be required, etc.  None of it needs to be correct, but it needs to be plausible.  If you already have some traction, perfect – lead in with that.
5. Demonstrate your vision is “fundable.”  Ensure the business model is plausible, then go on to explain why it’s probable.  Avoid any perceptions of a hobby, side-project, or lifestyle business, unless of course you already have serious traction.
6. Have a hacker co-founder.  If it’s a technology business, a resourceful developer can help bring the idea to life.  Having an MVP validated by even five people is far more valuable than a PowerPoint demo of its potential.
7. Discuss potential exit strategies.  Investors like to minimize risk and judges want to see vision – both like to know you intimately understand your space, how you align strategically or financially with it, and how big you’re thinking.  Is there a short/medium or long-term exit opportunity and who would be interested in acquiring you?  Again, be plausible, anything else is a red flag.
8. Sharpen your pitch.  Aim to achieve clarity and brevity; demonstrate to judges or future investors that your product/service can solve their pain, in a way that any potential customer can immediately understand.  Try to keep your verbal pitch to under 60 seconds, if possible intertwine the “story” with your demo.  Do an equipment/tech check in advance.  At Startup Weekend you get 5 minutes to pitch and they go fast, no sympathy is offered for botched presentations.

Next Steps.  If you are fortunate enough to have formed a great team and a compelling product or service (maybe even winning at Startup Weekend) – it’s time to start thinking about gaining traction, meeting investors and familiarizing yourself with Series Seed docs, which can help keep legal costs to a minimum.

It’s a lot to cover in five minutes, but an artfully crafted pitch by a charismatic presenter that incorporates the above items will help you stand out from the pack.  Be sure to also read How to Win at Startup Weekend and remember, it’s never personal – take the feedback and learn from it, iterate and use it as motivation!

Hope to see you at a future Startup Weekend or Grow Detroit event.