10 Point Business Startup Checklist💪
Ten points from Jason Calacanis and the team at LAUNCH that will help get your startup off the ground
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1) Are you solving a problem that has personal relevance?
Will your passion for your product and your dedication to your customers endure even during the toughest times?
Does your mission hold enough significance for you to prioritize it above all else?
Consider exemplary missions like:
Robinhood's pursuit of financial inclusivity
Calm's mission to normalize self-care and mindfulness
Eight Sleep's commitment to enhancing sleep quality and monitoring
Does the problem resonate with you on a profound level?
Not every venture aims to revolutionize global issues like Tesla's efforts in reducing carbon emissions.
Building a B2B sales tool is valid, as long as it resonates deeply with you.
However, if your sole motivations are wealth or fame, success might remain elusive.
2) Can you build a great product?
Do you possess these essential skills?
Developer: Can you build something from scratch?
Product Manager: Do you know what to build and how to get there?
UX/UI Designer: Can you create a user experience that's not just good but great?
If not, fret not! You can learn these skills for free online—no excuses.
Alternatively, explore no-code/low-code solutions to create a Minimum Viable Product (MVP) without diving into complex coding.
Or can you leverage No or Low-Code solutions!
We leverage tools like Notion, Zapier, Typeform, Bubble, and Squarespace, Beehiiv to streamline our processes.
3) Can you recruit elite talent to join your team?
Can you assemble a team of elite individuals who complement your skills?
For instance, if you excel in sales and vision but lack technical expertise, are you capable of recruiting a technical co-founder to handle product development?
If you're unable to build a product yourself, can you persuade skilled individuals to join your venture?
Does your venture offer a compelling enough opportunity to attract world-class engineers, designers, and salespeople?
Key factors that appeal to high-caliber talent include:
Equity: Offering a stake in the company to compete with lucrative salaries in big tech.
Lucrative opportunities: Think Uber, Airbnb, Stripe, Shopify—ventures with immense growth potential.
Meaningful work: Companies like Tesla (EVs) and Blokable (Housing) attract talent by addressing significant societal challenges.
4) Do you have a bias towards action?
Great founders thrive on action, not complacency.
If you prefer a laid-back work environment, dislike long hours, or avoid nights and weekends, the founder's journey might not suit you.
Founders are on call round the clock, tackling challenges from Sunday dawn to Saturday dusk and everything in between.
5) Pick a business Model that investors understand and love!
Your business model will depend on the type of product or service you're offering. But try to pick a simple one which investors can understand and love.
SaaS (Software as a Service): Ideal for generating recurring revenue, SaaS models are beloved by investors for their predictable income streams. Each payment cycle starts with nearly 100% revenue retention from the last cycle.
Fintech: Combining SaaS fees with transactional revenue, Fintech models—like those of Stripe, Shopify, and Plaid—are highly favored. They offer a dual-income approach that investors find appealing.
Marketplaces: While challenging to establish initially, marketplaces become unstoppable once they achieve scale. By taking a percentage of each transaction, they create a sustainable revenue stream. Examples include Amazon, Uber, and Airbnb.
However, it's crucial to steer clear of business models that may deter investors:
Direct to Consumer: Unless backed by a powerful brand or elite acquisition strategy, DTC models often exhibit lower margins and slower scalability.
Hardware: Historically low margins and slow scalability make hardware models less attractive to investors. Consider integrating a software component or offering Hardware-as-a-Service (HaaS) to enhance appeal.
Advertising: Relying solely on ad revenue requires massive scale, which can deter investors due to skepticism. Google and Facebook are prime examples of companies that have succeeded with this model but are exceptions rather than the norm.
Service-based: Typically lacking venture-scale potential, service-based models are often unappealing to investors and may not align with their growth objectives.
6) Do you know what problem(s) your product solves?
Identifying Your Product's Purpose
Understanding the problem(s) your product solves is pivotal for shaping your product roadmap.
Another framing of this question is "Why does your product exist?"
Examples:
Superhuman exists to streamline email communication.
Uber exists to facilitate faster and more affordable ridesharing.
Shopify exists to simplify online entrepreneurship.
Customer Importance and Current Solutions
Assess the significance of the problem to your customers.
Determine how they currently address it.
For instance, do they rely on Gmail, traditional taxis, or manual spreadsheet solutions like Excel?
Advantages of Your Solution
Highlight how your solution surpasses existing methods.
In the realm of technology, the answer typically revolves around being faster, cheaper, and/or better.
Uber, for example, offers faster and cheaper rides.
Superhuman makes email communication faster and more efficient.
Credibility and Deliverability
Winning founders understand that credibility is crucial.
Delivering on your promises builds trust and credibility with customers.
Consistently meeting customer expectations is key in this competitive landscape.
7) Can you explain your startup in one simple sentence?
Jason's OSS Rule
Emphasizes the importance of succinctly explaining your startup's core purpose in one clear sentence, devoid of buzzwords.
Investors appreciate simplicity and clarity in company descriptions.
Examples from well-known companies like Slack, Coinbase, and Uber demonstrate the effectiveness of this approach.
Alignment in Branding and Messaging
It's essential for branding and messaging to align with this simple sentence across all platforms.
Consistency in communication ensures clarity and reinforces the company's purpose.
Employee Understanding
Every employee should be able to articulate the company's purpose clearly.
This ensures consistency in communication and reinforces the company's mission.
Simplicity and Success
Simplifying both explanations and product development is key to success.
As Einstein famously said, "Everything should be made as simple as possible, but not simpler."
Customers won't grasp your value if your company's purpose isn't clear and concise.
8) Building an MVP (Minimum Viable Product)
An MVP is the simplest version of your product that you can launch.
Don't hesitate to launch your MVP; it doesn't need to be perfect.
Remember Reid Hoffman's advice: "If you're not embarrassed by the first version of your product, you've launched too late."
Considerations Before Building Your MVP
Assess your ability to build:
Can you code? If not, are you familiar with tools like Bubble or Webflow?
Do you have UI/UX experience or a good understanding of user experience?
Do you have a background in growth or sales? If not, can you create a growth model and a go-to-market plan?
Define the minimum:
Your MVP should solve a customer's problem, but it doesn't need all the bells and whistles.
Assess viability:
Will customers pay for your solution? This is crucial for your MVP's success.
Consider if a landing page is sufficient:
Depending on the complexity of the problem you're solving, a landing page coupled with a form might be enough for an MVP.
However, for real traction, you'll likely need more functionality.
Evaluate the potential of no-code tools:
No-code platforms can help you build an MVP efficiently.
If you can achieve traction with a no-code MVP, you'll be better positioned to attract investor interest.
9) Market: Are you creating a new market or servicing an existing one?
Consider whether you're pioneering a new market or catering to an existing one.
Spotify and Calm as Case Studies:
Spotify: Targeted an existing market with a clear demand—music enthusiasts. They recognized the universal appeal of music and aimed to provide unlimited access for a small monthly fee. The challenge lay in navigating complex rights issues that had hindered previous music startups like Napster.
Calm: Unlike Spotify, Calm ventured into uncharted territory. They didn't have a pre-existing market; instead, they contributed to the creation of their market. By launching an exceptional product at the right time—when society was increasingly embracing self-care—they helped cultivate a demand for their offering.
The Role of Great Products:
Creating Markets: Exceptional products have the power to shape and create markets rather than merely catering to existing ones.
Examples: Uber, Airbnb, and Calm are prime examples of companies that not only identified existing needs but also played a pivotal role in shaping the demand for their services.
10) Be able to pitch your startup effectively and concisely.
Effective Pitching: Jason's Rules
15-Second Product Introduction: Capture attention by succinctly presenting your product within 15 seconds.
Illustrative Examples: Incorporate real-life examples of people using your product to demonstrate its value.
Synchronicity: Ensure alignment between your verbal pitch and what's displayed on the screen for seamless communication.
One Slide, One Message: Keep slides simple and focused, delivering one clear message per slide.
Show, Don't Tell: Utilize performance data, customer testimonials, and process steps to illustrate your product's effectiveness instead of relying on text-heavy or vague descriptions.
Remember the OSS Rule
Craft a simple, jargon-free sentence explaining your startup's core purpose.
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