What do investors look for in a startup?

It’s obvious. It’s a tautology. Everybody says it. You have to be working with some of the best people in the industry you’re in. You’ve to have a great team.

A great video Interview with Venture Hacker Naval Ravikant answering the age-old question:

What do you look for in a startup?

Investors look for two things that are paramount above all:

  1. Great team: It’s obvious. It’s a tautology. Everybody says it. You have to be working with some of the best people in the industry you’re in.
  2. Huge market: Niche markets just don’t work because the first idea never works. You always have to change the idea, so you need room to maneuver in a big market.

There are three more factors that investors look at:

  1. Difficult technology that is compounding over time.
  2. A proprietary distribution channel. A clever viral marketing, or partnership, or whatever strategy that gives them a leg up over competitors.
  3. A direct monetization model. Something more than throwing up 10 cent banner ad CPMs.

Read more at Venture Hacks.


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oCricket

Brajeshwar posted this article on Sat, Sep 27th, 2008 at 5:47 am
Categorized under Asides, Startups and has the following tags

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