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30 Questions Investors Ask During Fundraising

This post originally appeared on Thoughts on Tech Startups and Venture Capital.

We’ve written a lot here about fundraising and how it is a complicated, and at times, confusing process. To fundraise effectively you need to prepare and have a strategy, understand different types of investors, understand how much to raise and create an investor pipeline.

We also talked about a fundraising deck and how you put it together. In addition to the deck, it is helpful to prepare answers to typical questions that investors tend to ask.

Below we discuss the typical questions you will hear from investors and discuss how you might go about answering them.

1. Who are your customers, and what problem are you solving for them?

Investors are looking for a simple and clear answer of who you are selling to. They also are looking to understand how clearly you know the pain point, and how big of a problem it is for the customers.

This question also opens up a conversation about founder-market-fit, as well as helps investors think about the size of the opportunity.

2. What is unique about your solution? What is your unique insight?

Investors want to understand how you are proposing to solve the problem, but more importantly, they are looking if you have unique insight. Has anyone else thought about this before? How is it different from other solutions? Do you have a secret?

Seriously, investors want to know this because the more differentiated you are, the more defensible the business might become in the future.

3. How does your product actually work?

Investors naturally want to see the demo of your product, because a demo is worth 1,000 words. A lot of investors want to fund product-obsessed founders – founders who get lost in details of the product, who are super thoughtful and nerdy about features they built, and really understand customer needs.

Always show your product to investors and make the demo awesome.

4. What are your KPIs? How do you measure growth? How do you know you have product market fit?

What numbers do you use to drive the business? Lack of clarity or hesitation is a major red flag for investors. If you as a founder aren’t clear about your metrics or not measuring the right things, investors won’t believe that you can grow the business.

Investors want to make sure you understand and measure your conversion and sales funnels, activation, retention, magic moment, churn, CAC, LTV, etc. Investors want to know how you think about KPIs, look at your dashboard and understand how you think about growth.

They will likely dig in on how you think about attaining product market fit as well.

5. What is your traction to date?

The question of traction is really two-fold. First, investors are literally asking what is your traction. Second, and more important, how do you define traction?

Many founders mistake progress or effort for traction. On the other hand, investors think of traction as revenue and paying customers or significant growth in weekly and monthly active users.

6. What is the size of this opportunity/total addressable market?

How big is your market – a question that matters to a lot of investors. Why? Because VCs economics force them to only focus on very large markets. VCs look for big markets with lots of money so that when they own 20 percent of your business, they get a meaningful amount to return all or a portion of their fund when you exit. Otherwise, they don’t make money.

In addition, investors expect you to size accessible markets and do the calculation bottom up. Too many founders say they are in $1BN+ markets without realizing that, because of their business model, they can’t be addressed.

Spend time sizing up your actual addressable market using your pricing and growth projections.

7. What are your CAC and LTV?

This is another typical question that investors ask founders during each round of financing to establish how fluent they are in the business.

In the early days, founders are expected to know the terms and have an idea of what the numbers are, but it’s fine to say that you are early, and the numbers are likely to change in the future (typically CAC goes up and LTV goes down).

The cost of user acquisition conversation leads to the conversation about channels, marketing and advertising spend. If you are B2B company with direct sales, you will talk about cost of sales and how it will change at scale.

Life-time value of the customer is equally important. How long does it take to pay back the amount it cost to acquire this customer? How much money will you make on the average customer?

The LTV conversation touches on churn, revenue per customer and enables investors to understand how you think about your whole customer lifecycle.

8. What is your business model?

Naturally, investors want to understand how you make money. They want to know who your customers are and how are you planning to charge them. This question combines not just pricing, but strategy and tactics. If you make money indirectly, via advertising, they would then focus on how your acquire customers.

If you are a marketplace, the conversation turns to whether you are going after supply or demand and the incentives to be on the platform. What will be the expected average revenue per user? Will you have recurring revenue? All these questions get explored when investors ask about your business model.

9. How did you come up with your pricing?

This is probably a less common question in the early stage, but it is an important one. Investors are looking for you to demonstrate that you’ve done customer research and competitor research. They are also looking for you to acknowledge that you are early and the pricing is likely to change.

In addition, if you are currently free or have a free tier, investors will look to understand when are you planning to get rid of it and what the implications will be.

10. What are your unit economics?

Unit economics give essentially an inductive case for your business. For example, for Uber, a unit would be either one ride or one driver, depending on how you model it.

The key thing in unit economics analysis is to capture all associated costs and revenues and then see if you are actually making money. Some startups have poor unit economics initially and say they will optimize costs later.

Many investors, however, are now weary of this approach because as you scale, new challenges and new unforeseen costs may arise.

11. What is your go to market strategy?

The go to market strategy question is a really important one and is often misunderstood. Investors ask this typically when founders say that their product works for everyone. Investors are skeptical, as experience says that focusing on a vertical or a segment is typically better.

For example, if you are building developer tools, you could initially focus on freelancers and individual developers. Then once the product is solid, you can move upstream to mid and large enterprises. Tesla had the opposite strategy. It first made a high end car and has been moving downstream.

You can also focus on a specific vertical. For example, if you are a security software provider, you can first focus on insurance companies or law enforcement agencies. Having a focus narrows down the opportunity but allows you to really perfect the product and sales.

When talking about your go to market, investors are really looking to understand your strategy and why you think it will work.

12. What are your customer acquisition and distribution channels?

How are you planning to acquire customers? In the consumer world, you have paid and unpaid means. You can advertise or you can use content marketing, social channels and word of mouth. Investors want to understand how deeply you understand your channels.

The challenge is that most obvious channels often do not really work or aren’t cost effective. That is when you start your CAC via Google or Facebook ads is just too high. Investors are looking to understand if you figured out a growth hack / have an insight on how to acquire customers quickly and efficiently.

In the B2B world, investors want to know if you have an unfair advantage, like you’ve worked in the space before and have a rich rolodex. They are looking to understand if you are able to secure key partnerships that can help you distribute the product faster and win the market faster.

13. Why now?

This is a question that often goes unasked, but is certainly on the investors mind. Timing is everything, and really understanding why now is the time for your company to win is important. The VC industry is full of examples when something was too early or too late, and as a result, it didn’t work or didn’t get as big.

Before Facebook, there was Friendster, before Google there was Alta Vista. Even Uber wasn’t the first company to think of on demand rides, and AirBnB wasn’t the first company to let people host people in their apartments.

Before the current wave of VR and AI, there were at least 3 other waves. Why do we believe now is different? Why do we believe now it will actually happen? Some argue that we finally have enough cheap computing power and have evolved other key technologies necessary for VR and AI to go mainstream.

When investors are asking “Why Now?”, they are really asking about conditions of the market, context and state of society – dozens of factors that will make a difference between success or failure this time around.

14. Why you? What is YOUR Founder-Market-Fit?

We’ve written here before about the importance of Founder-Market-Fit and how most investors pay close attention to it. Investors don’t want to fund accidental founders. They want to fund people with deep domain expertise, massive vision and passion. Investors want to get to the bottom of why you started the business – do you have unique insight and unfair advantage?

15. Where did you grow up? Where did you go to school and work?

In addition to understanding if you know the space, investors want to understand if you are resilient and smart. The question about where you grew up is really a question about how hard you have had to fight through your life to get to where you are. If you grew up in a well to do family where you didn’t have to struggle, investors may not be as excited about funding you compared to, let’s say, an immigrant.

There are no hard and fast rules of course, but the environment you grow up in often defines your level of resilience. When things get difficult, and they always do, will you walk away? When you get knocked down, will you get back up?

When asked where you went to school, people look to see if you went to a top school, what you studied and what you learned. Sometimes this conversation leads to a common connection. Sometimes it is just a starting point for learning more about you. Investors are looking to assess your level of intellectual curiosity and honesty.

16. How did you meet your co-founders?

This is another interesting question that doesn’t have a clear cut right answer, but is telling to investors. If you say you met at a hackathon 3 months ago, what you are saying is that you don’t really know each other well. Investors may think that the connection between you and your co-founders isn’t solid. If you are saying that you’ve been friends since high school, investors know that you trust each other.

However, they also know that you haven’t worked together. Friends don’t always make the best business partners, and startups have ruined thousands of friendships.

Most likely, investors are looking to hear that you worked together before, ideally in another startup and ideally for a while. This would imply that you get along socially, but more importantly, you can make things together under a stressful environment.

17. Who are your competitors and how are you different?

We’ve written here before how to think about competition. Investors are looking to understand how knowledgable you are about competitors and what is different about you. If you say you don’t have competition or if you bad mouth them, it is a red flag. Simply acknowledge competitors, and highlight what they are doing well. Explain how you are different and why.

18. What is your vision, your true north?

Some founders stumble on this question and this is a red flag for investors, particularly for VCs who want to back founders with big vision. What do you want your company to be in 10 years? This question reveals not only how you think about the business long term, but whether you plan for it to exist a decade or more. If your plan is to sell quick, you won’t have a broad long tem vision.

Similarly, a question about your true north is an important one. It reveals what you aren’t willing to compromise on. Great companies are always flexible on their path, but not flexible on the destination.

19. What milestones will you achieve with this financing?

We touched on this topic in our How Much Capital Should You Raise post. This topic is complex and founders often approach it with a naiveté. A typical answer might be expressed in terms of specific product milestones and scaling of the team. This is not what investors are looking for. They want to understand tangible business milestones you will reach with the capital you are given.

There are really two outcomes investors are looking for – either profitability, which is very rare in early stage startups, or the follow on financing. That is, investors are asking if you get funding and then execute and hit specific milestones, will you be fundable again? For example, if your plan says you raise $1MM, and then grow 20 percent MoM to achieve $40MRR in 12 months, to you this may sound great, but to investors it is clear that it will not be enough to raise a series A.

It makes sense to really think through your milestones and where you want to land and why.

20. How much will you be burning per month?

This is a pretty straightforward question that follows from your financial model. A few things to pay attention too: a) Your HR costs should roughly be 70K-100K per head. b) Investors will look for clarity around advertising spend — in the early days, before strong product market fit you should not me spending a lot of money to acquire customers and c) Investors will look for any outliers, anything that jumps out as out of ordinary or unusual.

21. What will be your MoM growth in customers and revenue?

Another straightforward question based on your financial model. As a startup, you need to make a growth assumption. The trick is that you don’t have a ton of historical data to back it up. Whatever data you do have, include it in the model and explain it, because it helps establish credibility.

Also, avoid cookie-cutter 20 percent MoM year round growth assumption, as it may come across as sloppy. Really think through seasonality and other factors that may influence your growth. Do your customers pay you right away or not? Does your cash in the door trail booked revenue? Reflect all the nuances in the model and your revenue forecast.

22. When will you be profitable?

Historically, many of the best startups have reinvested their revenues into the business and sacrificed profitability in favor of growth. Since the financing market has become tighter, profitability is fashionable again. Becoming profitable is important for many reasons, but the main one is that it allows you to become self sufficient and control your destiny.

When you are profitable, you are no longer in need of external capital in order to survive. Investors are looking to understand how you think about profitability, and tie this to the conversation about your burn and the need for follow on financing.

23. Why is your business defensible?

VCs want to know what happens to your business over time. Assuming you can get a lift off, investors want to know what happens year 5, year 10, etc. Why? Because this is a typical horizon over which more successful startups go public or get acquired for a significant return. Long-term defensibility is difficult to predict. That’s why many investors look for natural monopolies, winner take all markets and businesses with network effects.

This is a complex and important topic that is less likely to be top of mind for the founders, but is certainly something investors are paying a lot of attention to.

24. What is your intellectual property?

If you are startup that is creating a new technology, investors want to know about your IP. Are there things here that can be patented? What is the true innovation in your business? While software patents haven’t been effective in recent years, depending on the type of your business and depending on what kind of investors you are talking to, IP can be an important topic.

25. What is your tech stack?

This question will be particularly relevant for startups that are working in AI, VR, dev tools and other areas that require deep tech. Some investors, particularly technical ones, will want to nerd out with you on your stack.

26. What are the key risks in your business?

This is one of the hardest questions investors will ask you – why might you fail? This question is a probe for a) how do you think about risks in your business b) do you acknowledge risks and c) most importantly, are you self-aware and intellectually honest. Great founders bring up and face risks head on. They don’t try to shove them under the rug and ignore them.

Risks vastly range from building incorrect products, to the market not being there and to key distribution deals falling apart. Whatever it is, be prepared to talk about risks and show that you’ve been deeply thinking about them.

27. Who is the natural acquirer for your business?

Investors aren’t likely to ask you this question, but they will certainly think about it. Investors are putting money into your business to make more money, and historically, since the IPO market is tight, most successful companies are acquired.

Although you have no plan to sell your company, it is good to think about who might bite in the future and why.

28. How much capital did you raise so far and on what terms?

This is a simple question – just tell investors exactly how much you raised, whether you did it on the note or via equity. Don’t stumble or hesitate, because that would be a red flag.

29. Who are your existing investors?

This is another straightforward question.

30. How much capital are you raising and what are the terms?

You should have clarity on how much you are raising based on the financial model. Depending on where you are in the fundraising process, you may not have the terms set yet. If you don’t have the terms set, then just say so – investors will completely understand.

 

And now please tell us what we missed. Share the questions that investors asked you during your fundraising conversations.








What To Do When Your Fundraising Is Not Going Well

One of the worst things that can happen to a CEO of an early-stage company is to be in the state of perpetual fundraising.

Here is how you can tell that it may be happening to you:

  1. You have been fundraising for a while
  2. You are fundraising and running the business at the same time
  3. You don’t have strong interest from investors
  4. Investors aren’t engaged / don’t ask a ton of questions
  5. Investors keep telling you it’s early / to keep them posted

The list can go on, but you get the point.

You are wasting your time because you aren’t prepared and the timing is likely off.

Please go and read my popular post about 9 seed funding gotchas and I will be right here when you come back.

Disorganized, prolonged fundraising is exhausting and harmful for your company and your personal brand.

So what can you do?

Here are some things for you to consider to help the situation.

Do the Gut Check

Be honest—are you really READY to fundraise?

Have you prepared enough, or are you going out too early? When you go to bed at night and think about it, like really think about it, are you really ready?

The best way to fundraise is not to go out early, but to first prepare and answer a whole bunch of key questions about the business and the opportunity.

Think about questions like: why are you the right team, why are you going after this opportunity, why now, how do you know this is needed, what are the early indications of product-market fit, what is the business model, what are the unit economics, how are you going to acquire the customers, what is the pricing, what will this business be like in three years from now, who are the right investors, why would they invest, how do you get in front of them, what will be important to them—etc, etc, etc.

The nerdier you get about fundraising, and the more prepared and disciplined you are, the higher the chance you will be able to get it done faster.

If you aren’t ready, pause, go back, prepare, read my posts on fundraising and particularly on building a deck and pipeline, and then go back to the market.

Build Investor Pipeline

Assuming you passed the gut check, and you really feel like you are ready, next assess whether you are able to get in front of enough qualified investors.

Like sales, fundraising is a numbers game. If you don’t have a strong enough pipeline, you can’t get to the finish line.

Every single NO should cause you to add 3-5 more prospects to the top of the funnel.

If you are early on in the process, particularly a first-time founder without a strong network, you will find that fundraising is taking a long time because you aren’t even getting that many meetings.

Your fundraising process is stretched over weeks and months, but you aren’t seeing a lot of investors. As a result, you obsess over every single opportunity, like a few conversations you are having instead of focusing on having a lot more conversations.

What you need to do is to pause and focus on filling up your pipeline with 20-30 new investors. Just keep filling the pipeline, but do not take the meetings. After you have the pipeline filled up, THEN go and pitch everyone. This strategy will help you get a real signal and have a chance at creating momentum in your round.

Understand Investor Feedback

Assuming you have enough in your pipeline and you are meeting a bunch of investors in a short period of time, you really need to understand their feedback. What is the reason that people are saying NO? Do you not have enough traction? Is the space not interesting? Is the opportunity too small? Is it something else?

Whatever it is, your job as a founder is to avoid happy ears, parse the feedback you are given and really take it to heart.

If you are early and don’t have enough traction, then you need to understand the milestones people expect and go build the business until you hit them.

Investors may tell you that they don’t believe in the market size, or in unit economics or in your customer acquisition strategy—whatever feedback they give you, whatever the signal is, go back and address it. Understand the pushback, do research, get data, execute and come back with a fix.

Also, know that there are more subtle things that people won’t necessarily tell you about. For example, investors may not believe in the founding team and don’t see strong founder-market fit. Investors may not like the space. They may have issues with well-funded competition. If the issue is more subtle, try to really figure out what it is.

The bottom line is whatever the feedback is, no matter how tough it is, go back and address it.

Pre-seed Fundraising Strategy

Now let’s look at specific strategies for types of financing.

Your pre-seed round is truly an idea stage. You don’t have a product and you may not have your team fully assembled. You are super, super, super early. Read this other post I wrote first.

If you are a first-time founder, focus first on your friends and family, people who really know you and already think you are great. Get at least a little bit of their capital, and maybe even your personal capital so that you aren’t at zero. Being at zero is the worst state.

Don’t spend any time with VCs at this stage; you are WAY TOO EARLY.

You can raise capital from angels, but the key things are to a) get a little first from friends and family, b) target the investors correctly, and c) figure out milestones.

To build a correct list of potential investors, talk to other founders and ask them who the pre-seed stage firms and individuals were that funded them. Research, research and research some more to build the right list, otherwise you will be massively wasting your time.

Only specific funds and individual angels invest so early, so your job is to find investors whose strategy it is to fund the companies at your stage.

Next, think through all the tough questions you will be asked. Do the gut check—do you know the market, the customers, competitors, etc.? The more fluent you are in the problem and the business, the higher the chance you will get the check.

Lastly, clearly define milestones you are going to hit with the pre-seed round.

A typical milestone at this stage would be shipping the product. A better one would be shipping the product and getting a few early customers. No investor wants to give you a check to support your burn.

Investors want to fund you to the NEXT MILESTONE.

In the case of pre-seed, the key question an investor needs to answer is what milestones will enable you to raise a seed round. That’s really the meat of getting the pre-seed check—articulating milestones and metrics that will get you to the next round.

Seed Fundraising Strategy

Everything that we said for the pre-seed applies to the seed round as well.

Keep in mind that the bar is now higher in the seed round. You can’t be pre-product; you need to know your customers and you will likely be expected to have early traction. The game overall is upped significantly compared to pre-seed.

In addition, since the amount of capital you are raising is larger, you need to spend more time on identifying more relevant investors and getting introductions to them.

In terms of targeting investors, start with angels and micro VCs and try to get a few hundred thousand committed. Don’t spend a ton of time early on talking to venture firms, as they take longer and most of them would still think you are early.

By getting several hundred thousand committed on the round, you will be able to create momentum and will have better chance of getting larger checks.

Start with small checks—get to 1/4 or 1/3 of the round then shift focus to larger checks.

Also, how much capital are you asking for? 1.5MM – 2MM may be too high. Review your financial model. Can you make things happen with 1MM? If so, revise your model to be more capital efficient.

It is always better to start lower and then, based on the demand, over-subscribe vs. starting high and never getting there.

Series A Fundraising Strategy

It’s really tough to raise Series A if you don’t have strong metrics. Some founders raise on a story, but they are either repeat founders or working in the hyped-up spaces. Most founders will need really strong metrics.

There are exceptions, but if you are already generating revenue, you will be judged by your a) MRR/ARR and b) MoM Growth. However, strong metrics alone won’t get you a check. Not in this market, anyway.

The dance to raise Series A involves identifying the right firms and identifying the right partners, then getting to know them and letting them get to know you. It will also involve a lot of guts and luck.

Clearly assess how much appetite there is in the market. You should have a gut feel.

If the demand is not there, cut the burn (you should do it anyway), and go back to building the business.

Focus on getting to profitability.

Get feedback from the investors on what your metrics need to look like and keep them posted every eight weeks or so. Assuming you are growing well and hitting profitability, the investors will likely be open to another conversation.

In conclusion, fundraising is stressful, complex and needs to be done thoughtfully or else it is extra painful and takes way too long.

A lot of founders get fundraising wrong.

Do not fundraise randomly and perpetually. By doing so, you are literally harming your company and your personal brand.

As the CEO/founder, have the strength to listen to feedback, understand that you are not ready, pause, regroup, improve and go back to the market.

And lastly, get help! Read up, connect with other founders and get 2-3 key advisors on board. You don’t have to do this by yourself.

 

Techstars helps entrepreneurs succeed. Interested in joining the worldwide entrepreneur network? Learn how.

Originally posted on Alex’s blog.








8 Tips for Dealing with Competitors

Competition is a strange topic. It is both underrated and overrated. This may seem like a contradiction, but it really isn’t.

Startups often don’t spend enough time understanding the market and spend too much time worrying about competition once they launch.

In this post, we look at different aspects of competition and how a startup can deal with its competitors.

Do the Market Research Before You Launch

Before you launch your startup, you need to study the market. Startups are about the opportunities, and to identify an opportunity, the founding team needs to do market research.

The worst way to start the company is to start without understanding the market.

Just identifying the need and talking to customers is not enough. Part of the initial research is also understanding the competition. Who else is working on this problem? Are they small startups or big companies? How long have they been at it? How are they doing? Are they succeeding? If not, why not?

Understanding the competition is critical, because the opportunity may actually not exist.

Sure, customers may want the product, but competitors may already have a good enough offering. Founders rarely spend enough time doing market research and really understanding existing competitors, yet it is a critical part of launching a successful company.

Beware of ‘No Competitors’

There are a handful of red flags that turn off investors. One of them is when the CEO of a startup says, “We have no competitors. No one else has thought about this, we are the first ones!”

No matter how you look at it, saying you have no competitors is not a good thing.

First of all, by definition, all good ideas are competitive, and all real markets have competition. Lack of competition may imply lack of opportunity. Either there is no customer need, or the opportunity is small and not compelling.

More often than not, investors know the market better than founders and can name competitors better than the founders. This is also a bad situation, because it means that the founders either didn’t do their homework or did it poorly.

Either way, when a CEO says his or her company has no competitors, this creates immediate concerns and trust issues for potential investors.

Know Your Past and Future Competitors

When investors think about opportunities, they don’t just think of them in the present moment. The founders are expected to know about competitors who failed in the past and about potential future competitors as well.

For example, people have worked on Artificial Intelligence and Virtual Reality before and those efforts didn’t quite succeed.

Many startups are working in these spaces again and say that this time things will be different. While that may very much be true, the investors want to know what exactly is different now, what conditions didn’t exist before, and why this time is going to be different.

Similarly, it is important to think about who else may enter the market. This is a much more difficult dynamic to predict because by definition, predictions are difficult.

Investors often ask the founders what would happen if Google or another large company went after their market. While not possible to predict, it is good to think about this question and be ready to answer when asked.

Figure out Your Competitive Differentiation

Market research and studying your current, past and future competitors eventually boils down to one thing—what is your differentiation?

What is your unique insight? Why and how are you different? Why does this difference matter enough for you to win?

This is why having Founder-Market Fit is particularly important. Founders who have experience in their specific market typically have unique insights and are able to come up with offerings that are differentiated.

A good differentiation is typically product, go-to-market or sales advantage. Product advantage is created when your product is substantially different in how it works from competitors’ products.

Go-to-market advantage is based on channels that you are able to secure that no competitors can lock in. Sales advantage is typically based on your experience and deep understanding of the customers.

Keep Track of Your Competition, but Ignore the Noise

Most founders spend too much time worrying about competition on a daily basis. News is extremely noisy—someone launches something every day. If you follow every single bit of news from every one of your competitors, your life is likely a major emotional roller coaster.

In the end of the day, it is not what your competitors do, but rather what you do that matters more. You don’t have control over product releases, sales and PR of your competitors—all you can control is your own business.

Focusing on creating the best possible product that your customers love is your best defense against competition.

Instead of reading daily news about competition, set up a quarterly, or at most monthly, review of both competitors’ news and more importantly, products. This way you can keep track of what’s happening without the stress involved in following your competitors daily.

Accept and Play “The Idea Exchange” Game

When I was running my startups, I remember that feeling I would get when a competitor launched something that we had previously launched. A competitor stole our idea! Even worse, they executed it better, and no one gave us credit for being first.

Founders often complain about this situation. The reality is that this is now an accepted reality. Today, companies readily copy products and iterate on each others’ ideas. There is no protection for ideas; they are basically free to take.

Founders should just stop complaining and assume that their ideas will be copied.

The product and the business needs to be able to survive in the environment where pieces of UX and user flows are being copied.

In exchange, you as a founder benefit from taking ideas from your competitors’ products. Much like they copy your ideas, you can copy their ideas.

Build Relationship with Your Competitors

While sharing secrets with competitors is a bad idea, being friendly in general makes sense. Competitors are typically the most knowledgeable folks about the space besides you, and it is interesting to talk to them and get their perspective, again, without revealing too much.

Founders tend to run into their competitors at conferences and events, and naturally have the opportunity to connect. By building the relationship with your competitors you are both helping co-create the space, and getting to know your competitors as people.

You never know what the future holds. It may make sense for you to join forces or create a partnership. Markets with big opportunities tend to consolidate, so investing in a relationship with your competitors is likely a net positive for you.

Win with Your Heart and Mind

Once you are in the market, you compete on the product and your unique approach to the problem. No one but you knows exactly what you think and what you are building.

You win because of your unique approach, not because your competitors did or didn’t do something, copied or didn’t copy you.

Ultimately, competition does not matter nearly as much as your vision and your resilience.

You win by imagining the future and taking your customers, your company and the world there. You win with the product that is unique to you, with the business execution that is yours.

No competitor can take it away from you because they don’t see the world the same way. Your competitors aren’t you.

The best founding teams have their eyes set on the vision, their true north, and go there, regardless of what the competition does or doesn’t do.

The best founding teams win with their hearts and minds.








How to Generate Ten Demos Per Week with Sales Outreach

A few months ago, at Gorgias (NYC ’15), we decided it was time to open up our beta program to more companies. Therefore, we started looking for companies that we thought could be a good fit for our product. Here’s the method and the tools we used to generate ten demos per week.

For context, our product is a helpdesk, which enables companies to handle all their customer service in one screen.

Our outreach process was composed of three steps:

  • Get a list of targeted companies
  • Try to get a warm intro to this company
  • If you can’t a warm intro, send a cold email to the right person at the company

Step 1: Generate a List of Targeted Companies

A good place to start is to look for companies that are similar to your current customers. For instance, some of our customers are box businesses. It turns out there are several websites that list all box businesses (like Cratejoy). We used Kimono to scrape these lists and generate a csv with the details of each company. Kimono helps you generate a csv out of those 162 companies in seconds.

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We also looked for companies using competitive products. In our case, we looked for companies using Zendesk.

There are a ton of tools out there to help you with that, our favorite tools are Clearbit Discovery (very rich data) and Buitwith (pretty cheap: $300/m for about 4000 companies). Clearbit provides you with 58 data points per company. 

Once you get the list, it’s time to exclude all the companies that won’t be a good fit. You don’t want to spend time in later steps with people who’ll never use your product.

To identify companies that have repetitive customer service, we used the number of Twitter followers, and checked that companies had a Pinterest & Instagram account, as our current customers do.

Step 2: Try to Get a Warm Intro

The most efficient way to connect with a company was to get a warm introduction to one of their employees.

We started doing this manually: for each company, we checked the list of employees on LinkedIn to see if an employee was 2nd degree to us. Then, we sent a forwardable email to our common connection:

Hey Alex,

I’d like to get in touch with {company} and I’ve seen you know {employee}. Given they get repetitive support requests, I thought it would be interesting to connect with them. Could you please pass them this note?

Romain

— — —

Hi {employee},

{your pitch to the employee here}

— — —

In 60% of the cases, the employee would opt-in for the intro.

It turns out it’s easy to automate this process using Selenium scripts on LinkedIn. Given a list of companies, the script returns a list of employees who are 2nd degree to you that you can contact.

The script’s output: second degree connections who work at the target company, plus your common connection with them.

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Then, all you need to do is select the employee you want to contact, and then ask your common connection to introduce you 🙂

We’ve shared the script on Github if you’d like to try this technique. Thanks Brice Maurin for helping here 😉

Step 3: Alternatively, Send a Cold Email to the Right Person

If you don’t have a common connection with the company, your best option is now cold emailing.

Targeting is your best ally here. First, identify the role of your ideal target. In our case, this was the Customer Support Manager or the CEO.

Then, we used the Clearbit Sheets (an add-on on Google Sheets) to find who this person was for each company. The cool thing is that it also gives you their email address. Clearbit helps you find the right point of contact along with their email. 

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Now, you can set up an email campaign to get the attention of this person.


The conversion rates here can vary a lot depending on your audience/product. In our case, we had 10 demos for every 750 target companies, which was our weekly objective. For each company, we tried to get warm intro, which would lead to 3 demos, and then go with cold emailing to get another 7 demos.

If you’ve tried a similar process, please share your experience. And yes, if you’re tired of your current helpdesk, we’d love to give you early access to Gorgias.

At Techstars, we believe in full transparency. Check out this complete list of all of the companies that we’ve ever funded.

 

This post was originally published on Medium








Demo Day Round Up: Fall 2016

Fall is in full-swing here at Techstars with the addition of 64 new companies! Techstars recently had seven Demo Days across the globe, including Berlin, Mobility in Detroit, Barclays New York, London, Techstars Retail in partnership with Target in Minneapolis, New York City and Chicago. Phew!

Here’s a quick round up of the highlights:

Berlin Class of 2016

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Techstars Berlin’s second Demo Day, held at the iconic Kino International, showcased 10 companies from six different countries with products ranging from machine learning and AI, to SaaS and mobility.

Techstars Managing Director, Rob Johnson, opened the event and Executive Director, Greg Rogers, provided welcoming remarks. It was an exciting day to celebrate the 2016 class with investors, mentors and other founders from the Berlin startup community!

Congratulations to the Berlin Class of 2016!

 

Techstars Mobility, driven by Detroit Class of 2016

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Techstars Mobility hosted its second annual demo day in downtown Detroit on September 8. It was a showcase of the growing collaboration between startups and the automotive industry.

Over 2500 attendees from 12 different countries watched as 12 startups pitched their businesses impacting the future of automotive and transportation. These startups were building businesses around autonomous, connected vehicle, shared services, mapping, and big data and analytic technologies. Three of the 12 companies announced partnerships with the program’s title sponsor, Ford Motor Company.

The entire demo day was live streamed and that video can be watched on YouTube here.

Managing Director, Ted Serbinski, announced that Techstars Mobility has brought two additional high-growth startups to Detroit: Mapbox and Polysync, the latter of which is a Techstars Ventures investment. These companies will be opening their Detroit offices out of the Techstars Mobility space, joining Oblong who opened their Detroit office last year.

Bob Caza, Director of Communications at the North American International Auto Show, expanded on Techstars Mobility mission to expose more startups to Detroit by announcing that  we’re opening applications to bring 50+ mobility, automotive, and transportation startups to the 2017 Detroit Auto Show.

To capture this growth of the startup community, coupled with the entrepreneurial resurgence in Detroit, we debuted a trailer for Long Haul Films who is developing the documentary Restarting the Motor City. This is a feature-length documentary about the creators, innovators and entrepreneurs who are reimagining Detroit. They are breaking free from the shackles of 20th-century thinking to create a new model for cities across the globe.

Congratulations to the Mobility Class of 2016!

 

Barclays Accelerator, Powered by Techstars in New York Class of 2016

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Techstars Barclays NYC’s second Demo Day Event was held at the Edison Ballroom in the heart of the Theater District. Ten cutting-edge FinTech companies showcased products solving problems in real estate, capital markets, security, banking and the freelance economy.

Joe McGrath, the CEO of Barclays Americas, opened the evening with a warm welcome and recognition of the impact of Barclays’ programs around the world, which have seen collective valuations rise 190% from their pre-accelerator valuations.

Greg Rogers, Executive Director at Techstars, introduced the companies to the 600+ attendees including investors, mentors, Techstars alumni and community members. Jenny Fielding, the Managing Director, closed the event with a special thank you to mentors and Jon Zanoff, Entrepreneur in Residence, for their tireless devotion to this class and role in these companies’ success.

Congratulations to the Barclays New York Class of 2016!

 

London Class of 2016

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Led by Max Kelly, the Managing Director of Techstars London, the 2016 program kicked off with new offices, a new fund and a great new class. Within the class, one-third have PhDs and there are 19 separate nationalities! The variety of industries is astonishing – from grease to graph databases, from aid to artificial intelligence.

Each company presented their pitches to a packed venue during Demo Day, which took place on September 20 at the Royal Institution in London.

It is always exciting to be in the front seat of this kind of innovation.

Congratulations to the London Class of 2016!

 

Techstars Retail, in partnership with Target Class of 2016

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Techstars Retail’s first Demo Day, held at Orchestra Hall in Minneapolis, showcased eleven companies with products ranging from voice search, machine forecasting, visual registries and retail experience bots. More importantly, all these teams were able to demonstrate their accomplishments they achieved over the summer.

Techstars Managing Director, Ryan Broshar, welcomed almost 1,000 attendees then opened the evening with an inspiring message and fun facts about this year’s class. Target’s Chief Strategy & Innovation Officer, Casey Carl, shared welcoming remarks and reflected on his experience as a mentor. It was an exciting day to celebrate the 2016 class and the broader Twin Cities startup community!

Congratulations to the inaugural Techstars Retail Class of 2016!

 

New York City Class of 2016

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For the 2016 class, Techstars NYC experimented with a new take on Demo Day. Rather than live pitches Managing Director, Alex Iskold, introduced Exclusive Investor Preview and Investor Only Demo Day.

As with our previous classes, this was a diverse group of founders solving a wide range of problems. In addition to six teams from NYC, we had teams from Rochester, Atlanta, San Francisco, two teams from Philadelphia, a team from the UK, a team from France and two teams from Canada. Of these 15 companies, five have women CEOs.

The new Demo Day format was a hit among founders and mentors, and aligns with the spirit of innovation at Techstars.

Congratulations to the New York City Class of 2016!

 

Chicago Class of 2016

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Techstars Chicago’s seventh Demo Day, held at House of Blues in Chicago, showcased the latest ten startups selected from a pool of thousands of applicants. Companies ranged from a wearable hardware device enabling parents to keep track of their kids to enterprise and B2B software solutions, and showed both the diversity and high potential of the midwest startup ecosystem.

Techstars’ Managing Directors, Troy Henikoff and Brian Luerssen, along with Excelerate Labs co-founder, Sam Yagan, welcomed a packed house filled with notable investors and entrepreneurs. Chris Gladwin opened the afternoon with a keynote on the need for grit in operating his business to the recent 1.3 billion dollar sale of Cleversafe to IBM. It was an exciting day to celebrate the 2016 class and the broader Chicago startup community!

Congratulations to the Chicago Class of 2016!

 

Get a head start on your own entrepreneurial journey. Apply to an accelerator program. Applications close on October 15th.








Meet 15 Startups from Techstars NYC Summer 2016 Program

This post originally appeared on Thoughts on Tech Startups and Venture Capital.

We are delighted to introduce 15 Startups that are finishing our Summer 2016 Program today. As with our previous classes, this was a diverse group of founders solving a wide range of problems.

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In addition to 6 teams from NYC, we had teams from Rochester, Atlanta, San Francisco, two teams from Philadelphia, a team from the UK, a team from France and two teams from Canada. Of these 15 companies, five have women CEOs.

The founders have made real progress, and grew their revenues and customers during the program. Here are Techstars NYC Summer 2016 Investor Pitches:

Electronic Gaming Federation (EGF)

Electronic Gaming Federation organizes and produces college sports.

Email Tyler Schrodt, CEO of EGF

Forestry 

Forestry offers developers a new way to build and manage websites.

Email Scott Gallant, CEO of Forestry

Grubbly Farms

Grubbly Farms is producing a sustainable, insect based, food source for pets, aquaculture, and livestock.

Email Sean Warner, CEO of Grubbly Farms

Healthie

Healthie is a web and mobile platform for dietitians and nutritionists to manage their practice.

Email Erica Jain, CEO of Healthie

IOPipe

IOPipe provides a toolbox for developing, monitoring, and operating serverless applications.

Email Adam Johnson, CEO of IOPipe

LeBlum

Leblum lets consumers buy top quality flowers directly from the growers.

Email Sarah Corrigan, CEO of LeBlum

MindMate

MindMate is a platform for Alzheimer’s patients, families and care centers.

Email Susanne Mitschke, CEO of MindMate

MyFin

MyFin is the easiest way to manage and save your money.

Email Nathaniel Harley, CEO of MyFin

OnFrontiers

OnFrontiers is a platform that helps businesses connect with experts around the world.

Email Brian Caouette, CEO of OnFrontiers

Patch Homes

Patch Homes provides home equity financing at 0% interest and no monthly payments.

Email Sahil Gupta, CEO of Patch Homes

Pollen

Pollen is a marketing automation platform that enables online retailers to acquire new users more simply and cost effectively than Facebook and Google.

Email Zack Werner, CEO of Pollen

ProcessOut

ProcessOut is the smart router for payments that saves money by optimizing each transaction.

Email Cyril Chemla, CEO of ProcessOut

Purple

Purple is the easiest way to stay on top of the news and be informed. Ever.

Email Rebecca Harris, CEO of Purple

Skopenow

Skopenow is a people search engine for discovering fraud and evaluating risk.

Email Rob Douglas, CEO of Skopenow

Skywatch

Skywatch provides API access to the world’s satellite data.

Email James Slifierz, CEO of Skywatch

Thank you Mentors and Speakers

As always, we’ve had an amazing support from our mentors. They spent the time with the founders, gave feedback and engaged during the program.

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Techstars NYC Summer 2016 Mentors

Here is the thank you video that founders made for mentors:

We also had an amazing group of mentors who held weekly office hours, and focused on covering specific verticals.

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Every week during the all hands companies did shout outs and thanked most helpful mentors. We are excited to present Most Helpful Mentor Awards for Summer 2016 Program:

Most Helpful Overall Mentors award for Techstars Summer 2016 goes to Kevin King, Dane Atkinson, Chris Fraser, Soraya Dorabi and Maya Baratz Jordan!

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We also had amazing speakers who came to share their stories, and give founders feedback on their companies. Fireside chats were fun, insightful and really engaging.

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What Founders Learned in the Program

Tyler Schrodt, CEO of EGF:

Take the advice of your mentors seriously, but your path is ultimately your choice.

Fundraising is a full time job.

Scott Gallant, CEO of Forestry:

The importance of building a personal network of mentors and peers

How to prepare for fundraising (the best coaching on the planet)

Sean Warner, CEO of Grubbly Farms:

Networking – you always here networking is important, but seeing the outreach that Techstars has taught us how to properly utilize our / Techstars network, mainly looking at mentor engagement.

Defining growth through KPIs – there are many ways to monitor growth and though qualitative measurements are important, quantitative measurements are easier to distinguish growth over time.

Erica Jain, CEO of Healthie:

How to focus on the important stuff: Techstars has a tradition of “big rocks” – the premise being that you can fill your days with lots of activities, but at the end of the day, if you don’t execute on certain things – whether it’s achieving a certain metric or reaching a milestone – the company isn’t actually moving forward, even if you’re “always busy”.

That relationships are everything: Whether it’s with employees, mentors, co-founders, customers, or investors, building strong and genuine connections is ridiculously important, and incredibly rewarding.

Adam Johnson, CEO of IOPipe:

The power of giving first. There’s so much energy and momentum within our class by helping each other out. No requests were unanswered during our time at Techstars. The give first mentality did not end with our class, many alumnus and friends of Techstars went out of their way to help out. It was simply amazing.

I was surprised by how much impact the high energy of all the startups going through the Techstars program had on IOpipe. It was a constant motivator to keep pushing for as much progress and growth as we could within a short amount of time. Our investors have been so impressed by how far we’ve come in a short three months. Techstars definitely played a huge part in that.

Setting weekly big rock milestones to push us harder every week has been a great motivator for us to keep the eye on the ball, and re-think what’s most important for us. IOpipe will continue this exercise long after our time at Techstars.

Sarah Corrigan, CEO of LeBlum:

Don’t abuse the Pivot. Intuition and data combined are sufficient guides and indicators of whether or not your company has a reason to exist. Consider peoples’ doubts, but never cater to them.

Accept Criticism Gracefully. A start-up starts out scrappy but eventually has to evolve into a well organized operation of systems and standards. As a founder that means that you to have to be willing to accept faults, recognize what needs to improve and be willing to make changes – without delay. So, don’t be a sh!tty human, and if you are being one – stop being a sh!tty human, immediately.

Susanne Mitschke, CEO of MindMate:

Pick ONE KPI and execute ONLY on that

Say “NO” to stuff that doesn’t move the needle! Be hard on that!

Nathaniel Harley, CEO My Fin

Marketing automation – how to think about the different states – activation, magic moment, and retention. Being very early and in product building mode, we really honed in on the activation state…. need to still work on magic moment / retention. I obviously learned this before, but it’s much different for MyFin than it was for Spoon. App is very different than content site.

Prioritization – as a team, we’ve gotten much better at doing daily sprints, focusing on what’s most important, and constantly re-prioritizing based on where we’re at, feedback, etc.

Positioning – one of the hardest things to do is narrow down the focus of the company into a few sentences. It’s been extremely helpful to get down to the essence of what we’re building, and how to articulate to people.

Sahil Gupta, CEO of Patch Homes:

Be firm yet flexible in my approach. Whether is product, market strategy or fundraising – listen to what people are saying.

Become better at using data to validate hypothesis and drive decision making.

Zack Werner, CEO of Pollen:

I have been raising money for a long time, and TS helped me get a MUCH better understanding of how to talk to investors and create a funnel for investment.

It was great for my team to learn how to operate in the same space and with a structure for operation.

Rebecca Harris, CEO of Purple:

How to define KPIs, set goals for growing them, and develop a process for achieving those goals.

I learned so much about fundraising.

Rob Douglas, CEO of Skopenow:

Thinking like a CEO – Growth strategies (sales and business development), pricing, getting ready for scaling, and finding the right hires.

Understanding the VC world – the ins, outs, and in-betweens of VC communication from intros to closings…#ABC

Thank you Associates!

Huge thank you to our associates, they’ve done an amazing job! Sara, Alli, Susan, Jay, Kashif, Dan, Mike and Oliver – massive thank you for your hard work and dedication – you were SUPER HELPFUL to founders and Techstars.

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Techstars NYC 2016 Crew

Tweets from Investors and Founders

Good luck, Techstars NYC Summer 2016!

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Electronic Gaming Federation (Techstars ’16)

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Forestry (Techstars ’16)

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Grubbly Farms (Techstars ’16)

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Healthie (Techstars ’16)

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IOPipe (Techstars ’16)

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LeBlum (Techstars ’16)

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MindMate (Techstars ’16)

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MyFin (Techstars ’16)

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OnFrontiers (Techstars ’16)

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Patch Homes (Techstars ’16)

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ProcessOut (Techstars ’16)

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Purple (Techstars ’16)

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Skopenow (Techstars ’16)

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Skywatch (Techstars ’16)

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Techstars Demo Day Experiments

At Techstars, we have a culture of innovation and experimentation. Our strength stems from our diversity and distributed nature. Every Techstars location adds its own local flavor and experiments constantly. We tweak the program content, how we engage mentors and corporate partners, and also how we help our founders connect with investors. We then share what works and what doesn’t to make the network better over time.

No matter if you are going to a program in NY, Boston or Cape Town, you will get the very best Techstars Demo Day experience.

A New Take on an Old Idea

Since early 2007, our Demo Days have consistently attracted hundreds of investors and community members. Demo Days are powerful community celebrations and an effective way to connect the founders and investors. Techstars companies have now raised more than $2.5B and Demo Day has been a huge part of that success.

For the past couple of years, we’ve been experimenting with additional ways we can improve and optimize this connection in addition to Demo Days.

It started back in Boulder in 2014 when Nicole Glaros, then a Managing Director and now Chief Product Officer at Techstars, launched an investor-only Demo Day for active investors.

The idea and the formula was quite simple: investors were split into groups with about 20 investors per room. The CEOs walked from one room to another and gave their Demo Day Pitch. After the pitch, investors did a quick Q&A and the founder moved onto the next room. The investors had contact information for every founder and were able to reach out directly.

This was followed by the traditional Demo Day, which was more of a community celebration, and most of the investors who were at the private event also attended that Demo Day.

An Improved Experience for Everyone Involved

This new format was an instant success. Both investors and founders loved the intimacy of the setting and the ability to interact and ask questions. Over the next few years, other Techstars programs experimented with a version of this setup, including our Seattle and Chicago programs. Jenny Fielding just ran an invite-only investor Demo Day for our FinTech program in NYC.

Our Chicago program recently rented 10 suites in a hotel with eight active investors per room. The only folks who participated were people who wrote checks in a previous class. CEOs did the pitches followed by Q&A. In addition, Chicago added another tweak – investors had five minutes to discuss the company amongst themselves. Once again, investors and founders loved the format.

This year Techstars NYC is building on the experiments from other cities and rolling our own experiment. We are introducing Exclusive Investor Preview and Investor only Demo Day.

The Investor Preview

The Investor Preview is invite-only and takes place before the Demo Day. To get invited, you need to have invested in at least one Techstars NYC company within the last four years. Each investor is pre-matched by us with six companies based on their investment focus. Before the preview, investors get elevator pitches from all companies in the class and can ask to swap out one or more companies. Similarly, founders can opt-out of the meetings with investors whom they don’t want to meet.

During the preview, each investor comes in for 2.5 hours and has six 25 minute meetings. During the first five minutes of the meeting, the investor watches the video of the company pitch and then spends 20 minutes doing Q&A with the CEO. After that, the investor moves onto the next company. When there is a mutual interest to continue, the founder and investor exchange contact information. So far we’ve gotten hugely positive feedback on this format from both investors and the founders.

For the Investor only Demo Day we are trying a new format as well.

The Investor Only Demo Day

Again, the Demo Day is invite-only for investors, but it is not required that you have previously invested in one of our companies. The Demo Day on 9/29 will take place in the Techstars NYC office, where 15 CEOs will have stations much like you would have at a conference. We issued 200 investor tickets for 10 a.m., 200 investor tickets for 11 a.m., 200 investor tickets for noon, etc.

When investors come in, they can quickly connect with each CEO or go to a theater space to watch video pitches. Techstars staff will walk around and help investors quickly send the contact information to all companies they want to follow up with.

We anticipate an amazing turn out this coming Thursday and look forward to everyone’s feedback.

The best companies constantly tweak and iterate. At Techstars, experimentation and improvement are part of our DNA. This is what we tell our founders and this is what we constantly do internally. Not only do we have cool new tweaks this year, we’ve already been thinking about new things that we will be doing in 2017.

Do you have ideas for how we can enhance Demo Days or do anything else better? Please leave a comment here or email me at alex.iskold@techstars.com.








Barclays Accelerator, powered by Techstars in NYC Demo Day








Action and Idea Lists for Lean Startups

Startups are easily overwhelmed with ideas. They have a ton of their own, and they hear a lot of advice from others. How do you actually take all of the ideas and prioritize, focus, execute and grow?

Here is a simple system inspired by Agile software development that can help you do that. It’s a spin on the traditional to-do lists that helps you keep it simple and actually execute.

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1. Iteration

The key to getting things done is to set goals and divide time into chunks to hit each goal. If you don’t have goals, then you are just doing stuff, but not clearly making progress. Let’s call a chunk of time to hit a set of goals an “iteration.” The duration of any given iteration can vary – it can be 1 day or 2 weeks, but not much longer than that. At Techstars, for example, we measure time in weeks, since we are trying to accomplish a lot in just 13 weeks. Every week has its own set of goals, so every week is its own iteration. The tasks you do during the iteration go onto the Action List.

2. Action List

The first rule is that the Action List can only have 10 items (or less!) at any given time. The #1 to-do is what you are working on now. To-dos 2, 3 and 4 are pretty solid – unless there is a drastic change in your world, they will make it to the #1 spot soon and you will work on them. To-dos 5-10 are a little less solid; you might not actually get to them, or you may tweak or even delete some of them. But as of now, you do intend to execute them during this iteration.

That’s really it in terms of Action List setup. You work through it one to-do at a time. Intensely focus on each task and crush it. Make sure you do it as thoroughly and as completely as possible.

Every time you check off an item, take a quick moment to celebrate. Every small win is the opportunity to smile and relieve stress.

3. Idea List

This is what every single person, from CEO to an engineer to a social media manager, gets wrong. They get excited about a new idea, drop what they are working on, and start working on the new thing. This is the worst possible way to get things done. The task at hand is left unfinished. Most likely you will have to go back to it, but you will by then lose the context and the flow. Most likely you will keep adding new tasks, and you will find yourself context switching all the time. As a result, no tasks will be done well. You are going to create half-baked things and nothing will really work.

Remember, you are not necessarily smarter right now than you were 10 minutes ago or a day ago or a week ago. If you made a decision in the past to schedule the task, respect yourself and finish it.

Of course there are sometimes exceptional cases when you can cancel the task at hand, but it should be very rare. In any case, the new task shouldn’t replace what you are working on now.

It doesn’t even make sense to stick new ideas into the Action List yet. That list has already been prioritized, and it’s not yet clear where the new idea would fit. For that purpose, you will have another list, called the Idea List. The new tasks ALWAYS go to the bottom of the Idea List. ALWAYS.

The Idea List can also only have at most 10 items. Why? Because you don’t need to add every single idea you have or you hear to any list at all. In fact, quite the opposite – the default should be to NOT add. Every idea first needs to prove itself to you.

Like things in the real world, the ideas need to compete for your attention and win before they make it to the Idea List.

You need to hear an idea over and over from your customers, co-workers, advisors and yourself. Once it becomes obvious, then the idea will get a spot on the Idea List.

4. Prioritize: Append, Trim and Delete

Regardless of the length of your Iteration – 1 day or 2 weeks or anything in between – in the end of the Iteration, you will re-prioritize. To do that, first append all items from the Idea List to the bottom of the Action List. It does not matter if the Action List is empty or the Idea List is full.

You then re-prioritize everything based on your current understanding of the world and trim the Action List to again be 10 items only. After that, place the 4 runner-up ideas on the Idea List and discard the rest. Don’t be afraid of this step. The ideas will come back if they are great ideas.

Give this a try and let me know how it works out for you. Using another system? I would love to hear about it in the comments.

 

This post was originally published on Alex’s blog