Investors and entrepreneurs align on at least one thing:
“There is no formula on succeeding with startups.”
In fact, both parties will be the first to admit that there are more lessons they could share on failure rather than success, as the probability of failure far outstrips that of success.
However, there are some useful notes I have assembled in recent years on what I would look for in assessing new startup opportunities as well as looking for a cofounder.
New Startup Idea Assessment
- Is it a billion dollar market? VCs love big markets, the tough question is “are you willing to go after niche markets regardless if others believe in it or not?”
- What are the existing alternatives (competitors)?
- How painful is the problem/ inefficiencies?
- Who is this a problem for (users)?
- What could be my moat/ defensibility?
- Why am I the right person to solve this problem?
- What would 5x / 10x experience be like?
Potential Cofounder Assessment
- Common beliefs and values e.g. falling in love with problems not solutions, customer first, alignment on first principles, being willing to hire and fire based on values.
- Grit and determination — not give up when the going gets tough in the face of adversity.
- Complimentary skillsets — strong where I am weak. Perfect founding team has strong Commercial, Product and Tech skills.
- Genuine joy to work alongside as you will likely spend more time with your cofounder than you partner or children in the early years of building your startup.
- A partner that is intelligent, has high integrity and works hard.
- Someone willing to join you in finding a solution for many users with a problem.
Working in or creating a startup has exploded in popularity in the last decade as young people day dream about working fast and hard for a few years creating a small company that could create life changing wealth and opportunities. Although this outcome is rare, it is possible and chances improve the more new founders learn lessons from former entrepreneurs such as the underlying principles outlined above.
Check out the 25 Lessons I Learned from Successful Entrepreneurs for more!