In the startup world, you’ll hear a lot of stories about big ideas and how they are going to happen. So, they’ve created a unicorn that will change the world? That’s great, but you’ve got to find out – are they a unicorn, or just a horse in a headband?
A startup should be able to demonstrate why their idea is the next big thing. In other words, talk the talk and walk the walk. If the company has some traction and is making money, then they should absolutely show what’s working behind the scenes to make it grow. But what if they’re not quite there yet and haven’t made a lot of money?
If that’s the case, you need to ask questions to get a better idea of what they have in place.
How will they generate leads? What does that look like?
What is their current sales pitch/angle and how will it work for them?
Where are their customers coming from, and how do they make the sale?
They might have a great idea, but they’ll need to do more than just lay out a slide deck with goals they hope to achieve. A good startup must be able to back it up with a well thought out plan to accomplish those goals.
If they’ve done their homework and have clear answers and processes in place, it shows that they’re the expert — and that shows potential for investment.