Guest blog: How to decide in which startup to invest

Guest blog: How to decide in which startup to invest

17-Jan-2014 by Patrick de Zeeuw

How to decide in which Startup to invest?

DemodayOn January 17th, the Demo Day of Startupbootcamp NFC & Contactless takes place in Amsterdam. 10 high potential startups, from seven countries, will pitch their businesses for an audience of 400+ investors. They all have developed products based on Wireless & Interactive technology. After 3 months of intense mentorship, inspiring workshops (f.e. about Business Modeling Tools for Startups – by Business Models Inc.), product building, and customer validation, they have the opportunity to find an investor for their idea. But how does an investor or VC (Venture Capitalist) select the right Startup?

Business Model Check for Venture Capitalists

CheckBMIWith our Business Model Check for Venture Capitalists, VC’s can check if the Startup has been working on all 9 building blocks of their business model (as defined in the Business Model Canvas) and not only on their product or their technology innovation! We recommend VC’s to take a look at the total Business Model: how does the Startup create, deliver and capture value? What channels are they using to market the product? What about their revenue model? According to us, VC’s should be asking the following questions:

1. Vision: What is the vision behind the Startup? Why do they exist? Do they have a winning aspiration? A strong vision drives the team and the business model forward.

2. Customer: Who exactly is the customer? Did the Startup test the idea with (potential) clients? What was the feedback? How many potential customers did the Startup actually meet in person?

3. Value Proposition: Does the Startup’s value proposition address a relevant job-to-be-done for customers? Does their product really solve a problem for the client? How many prototypes (minimum viable products) have they already built to test their value proposition with real customers?

4. Revenue: Are customers willing to pay for the value provided? How much revenue did they generate so far? And is their business model scalable?

5. Partners: Do they have the right partners to succeed? Who exactly are the partners they are working with right now, to build a better value proposition for their customers?

6. Resources: What is the sales capacity of the Startup? Are they great product developers AND can they sell their product? Do they have a diverse team with diverse capacities?

Download here the Business Model Check for Venture Capitalists.

We wish all Startups of Startup Bootcamp NFC & Contactless a wonderful Demo Day and all VC’s good luck with choosing the right Startup to invest in!

Patrick de Zeeuw

Patrick is a Co-founder of Startupbootcamp Amsterdam and board member of Startupbootcamp Global. He is an active angel investor, building media, online and mobile companies. Patrick was the former CEO of Endemol Belgium & Poland, the Founder of 3Circles Media, CCO of SBSnet, and MD of United Broadcast Facilities International and Unitedesign. He coaches Start-ups in the online & mobile industry and sits at the advisory Board at Netgamix & Mobitto.