For entrepreneurs pitching investors: make sure you’ve included “exit” thinking.<\/p>\n
I see a lot of entrepreneur plans with the usual stuff on how the product\/service will be developed, how it will be marketed, how much capital is needed, and how the business will grow. The frequently missing item is the exit analysis<\/strong>: is there a plausible path for $1 invested to be worth $10?<\/p>\n Investors invest to generate a return. You can build a business with the greatest {revenue|users|uniques|units sold|subscribers} in the world, but if it’s not valuable<\/em>, it doesn’t matter. Some basic exit analysis against comparables (public companies, acquisitions of similar companies, funding rounds) may surface investment flaws, such as: low-margins, poor scalability (e.g. many services-centric businesses), and capital inefficiencies (e.g. $50m needed to make a company worth $100m).<\/p>\n Avoid the embarrassment in the VC conference room: do your exit analysis homework.<\/p>\n","protected":false},"excerpt":{"rendered":" For entrepreneurs pitching investors: make sure you’ve included “exit” thinking. I see a lot of entrepreneur plans with the usual stuff on how the product\/service will be developed, how it will be marketed, how much capital is needed, and how … Continue reading