By Ragoo Raghunathan.
Three out of five (62%) Americans polled wanted to start a business and make their dreams come true. In a survey of 1,000 American non-business owners done by the New York Post as many as 37% have genuine aspirations to become their own boss and 25% of them said they would seriously consider it.
While there are 582 million entrepreneurs in the world, not all of them succeed, 22.5% of small business fail within the first year. While the startup environment is promising, you should definitely consider a few questions before starting a business or before reaching out to investors.
In a recent blog article on LinkedIn, Ian Mathews, the CEO of 5on4 (https://5on4.group/) suggested these questions that I thought would be interesting for aspiring founders or entrepreneurs in our audience.
1. What problem are you trying to solve? Is it widespread?
2. What pain will you alleviate or eliminate?
3. Is this problem real enough where someone will pay you to fix it?
4. How are people dealing with the problem without you? What competitive solutions exist?
5. How will you improve upon existing solutions? How will you supplant competitors?
6. How easy is this business to start? What are the barriers to entry?
7. If it is a simple business to start, what prevents others from quickly following you?
8. What will make your product/service unique enough to command a premium? How will you avoid a race to the bottom on price?
9. Will this business scale? Can it thrive without you doing all the work?
10. How will you get attention and attract new customers? Will those customers purchase once or repeatedly?
Depending on their background, an investor might put greater emphasis on certain of these questions. Some might dwell more on the marketing aspects, while others might be more curious about the engineering challenges. Regardless of their expertise and background they will all touch on these questions. If investors ask these questions before making a commitment, shouldn’t you also be asking yourself before you commit your time and effort?
You can find out more nuggets on Ian’s website at 5on4.group.