“Wanted. Men for hazardous journey. Low wages. Bitter cold. Long hours of complete darkness. Safe return doubtful. Honor and recognition in the event of success.”
In 1907, Ernest Shackleton issued a challenge: journey with him, literally, to the ends of the earth. A perilous trek where failure was imminent, but if you survived, the promise of honor and recognition would be yours. This challenge is familiar territory for any entrepreneur. The risks inherent to starting a thriving business in today’s troubled waters are immense, but we know of no work more fulfilling. At Kickstart, we recognize and accept risk; nevertheless, we look for four factors within our investment considerations to help mitigate these dangers before going onboard with a new venture.
1. The Management Team
– Venture experience, strong track record
– Domain knowledge, industry & local relationships
– Vision, drive, judgment
– A team Kickstart can comfortably work with
2. The Market
– Large, growing opportunity
– Sustainable competitive advantages
– Customer validated value proposition of product/service
3. The Technology
– Protected intellectual property
– Broadly applicable platform technology
– First Mover or Best-of-Class advantage
4. The Deal
– Favorable pre-money valuation, reasonable terms
– Milestone driven plan, budgets
– Probable liquidity alternatives 3-7 years
– Sophisticated, capable, like-minded co-investors
The response to Shackleton’s ad was incredible. He was inundated with requests to join his crew. The funding climate today is no different. Competition abounds and capital is scarce. We are unable to fund every deal, but we carefully review every business plan that is submitted. We like business plans that present a lot of information in as few words as possible. The following business plan format, within 15-20 slides, is all that's needed:
One Line Pitch
- Define the company/business in a single declarative sentence.
Team
- Founders & Management
- Board of Directors/Board of Advisors
Problem
- Describe the market pain.
- Outline how the customer addresses the issue today.
Solution
- Demonstrate your company’s value proposition to make the customer’s life better.
- Show the status of your product.
- Provide examples of traction.
History
- Set-up the historical evolution of your category.
- Define recent trends that make your solution possible.
Market Size
- Identify/profile your target market.
- Calculate the available market, served available market, and share of market.
Product
- Product line-up (design, features, functionality, intellectual property).
- Development timeline.
Competition
- List competitors
- List competitive advantages
Business Model
- Revenue model
- Pricing
- Average account size and/or lifetime value
- Sales & distribution model
- Customer/pipeline list
Financials
- P&L
- Balance sheet
- Cash flow
- Cap table
- The deal