It depends on the quality of the idea. I’m a firm believer in Derek Sivers‘ calculus, which goes like this:
AWFUL IDEA = -$1
WEAK IDEA = $1
SO-SO IDEA = $5
GOOD IDEA = $10
GREAT IDEA = $15
BRILLIANT IDEA = $20
The real value, of course (as other answers here have noted), comes from executing on the idea. And to see how that calculation works, check out Derek’s classic, seminal article on the subject:
*original post can be found on Quora @ : http://www.quora.com/David-S-Rose/answers *
Image via Facebook.com
Every entrepreneur needs to be honest about their strengths and weaknesses, and realistic about their reasons for choosing the startup route. For any entrepreneur, even the best business opportunities, if entered for the wrong reasons, will likely fail. Some of these reasons seem obvious, so forgive me for restating, but I still hear them too often.
Statistics show that at least 50% of new startups fail within five years, and many of the survivors eventually fail. If you don’t want to be part of these statistics, consider all the alternatives to starting your own business, especially if you have one of the following perspectives: Read more
Eric Ries image via Fast Company
The popular view of a real entrepreneur is someone with a big vision, and a stubborn determination to charge straight ahead through any obstacle and make it happen. The vision part is fine, but successful entrepreneurs have found that the extreme uncertainty of a new product or service usually requires many course corrections, or “pivots” to find a successful formula.
This reality has fostered a popular startup approach which dramatically improves the efficiency and speed of these corrections, pioneered by Silicon Valley entrepreneur and author Eric Ries. His popular book on this subject, “The Lean Startup,” lays out how today’s entrepreneurs use continuous innovation to create radically successful businesses. Read more
Industry Experts, Invested Interests
In very general terms, roughly 1,500 startups get funded by venture capitalists in the US, and 50,000 by angel investors. VCs look at around 400 companies for every one in which they invest; angels look at 40.
There are several million “startups” that are formed each year, so one way of looking at it is that there are several million “great people with a good idea who give up because they just cannot get initial funding”.
On the other hand, those VCs and angel investors spend all their time proactively seeking the best companies they can find, and despite their concerted efforts at picking the best of the best, fully half of the ones they do fund will go out of business with a couple of years. Looked at that way, of the 50,000-60,000 deals that get funded each year 30,000 of them should not have been funded (let alone the other few million who wanted funding)… therefore there are no really great people with really great ideas who go unfunded.
Of course, the reality lies somewhere between those two extremes, but my personal guess, as someone who is familiar with the issue from both sides of the table, is that “lack of available funding for truly deserving deals” is not one of the biggest challenges facing entrepreneurship in the US.
*original post can be found on Quora @ : http://www.quora.com/David-S-Rose/answers *
Image via eHow.com
Once you have a potential investor excited about your team, your product, and your company, the investor will inevitably ask “What is your company’s valuation?” Many entrepreneurs stumble at this point, losing the deal or most of their ownership, by having no answer, saying “make me an offer,” or quoting an exorbitant number.
I’ve written about this before, but it’s a mysterious subject, and I’m always learning more. This time I’ll use a hypothetical health-care web site company named NewCo as an example to illustrate the points. Read more
Google's Larry Page image via Coolspotters.com
A while back, when a startup founder mentioned to me that he wasn’t sure he had the personality to be an entrepreneur, I realized how important that insight was. My first thought is that if you are more annoyed than energized by expert advice, team suggestions, and customer input, then you should probably avoid this line of work.
Actually, it’s more complicated than that, but that’s a good start. After working with entrepreneurs for more than a decade, I have developed a good “radar” to quickly recognize mentalities that will likely pass the test of investors, employees, and customers. Read more
As I write this, days after the 2012 presidential election, I’m probably not alone in feeling relieved that the political jeering and soapboxing that reached a feverish pitch during the seemingly endless campaign season has finally subsided. Yet amidst all the partisan cheerleading and name-calling, there has been some discussion of substance. One particular four-letter word has been used pervasively by candidates of all stripes: Jobs.
Enter your email address to subscribe to the Gust Blog.
You can unsubscribe at any time.
