Comments on: Guide to Evaluating Startup Ideas http://www.tonywright.com/2010/guide-to-evaluating-startup-ideas/ Tue, 01 Nov 2011 20:51:00 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Darryl http://www.tonywright.com/2010/guide-to-evaluating-startup-ideas/#comment-601 Darryl Wed, 30 Jun 2010 20:10:32 +0000 http://www.tonywright.com/?p=245#comment-601 Point number 3 is indeed very interesting. Is anyone aware of any benchmarks for cost-of-acquisition for financial products? Point number 3 is indeed very interesting. Is anyone aware of any benchmarks for cost-of-acquisition for financial products?

]]> By: webwright http://www.tonywright.com/2010/guide-to-evaluating-startup-ideas/#comment-600 webwright Fri, 11 Jun 2010 11:01:59 +0000 http://www.tonywright.com/?p=245#comment-600 I've always been a fan of Pmarca's masterful startup post: "The only thing<br>that matters". He contends that the only thing is "the market". I tend to<br>agree. I've seen a LOT of mediocre teams see great success and a lot of<br>great teams fall flat. Here's the post:<br><br>*http://pmarchive.com/guide_to_startups_part4* I've always been a fan of Pmarca's masterful startup post: “The only thing
that matters”. He contends that the only thing is “the market”. I tend to
agree. I've seen a LOT of mediocre teams see great success and a lot of
great teams fall flat. Here's the post:

*http://pmarchive.com/guide_to_startups_part4*

]]> By: StartupDojang http://www.tonywright.com/2010/guide-to-evaluating-startup-ideas/#comment-599 StartupDojang Fri, 11 Jun 2010 09:05:23 +0000 http://www.tonywright.com/?p=245#comment-599 This is an interesting post. So if I were to choose a startup to join, I would put on my venture capitalist hat. Most VCs will tell you they do not invest in ideas, but rather the startup team. Sequoia invested in GOOGLE when there were already hundreds of search engines available, some of which had significant market share. At the time, GOOGLE could have easily been seen as a terrible idea. However, as we know now, GOOGLE revolutionized web search. Sequoia invested in Larry and Sergey as opposed to the idea. That is not to say the idea has no merit, but the team is highly weighted when compared to the idea.<br><br><a href="www.startupdojang.com" rel="nofollow">www.startupdojang.com</a> This is an interesting post. So if I were to choose a startup to join, I would put on my venture capitalist hat. Most VCs will tell you they do not invest in ideas, but rather the startup team. Sequoia invested in GOOGLE when there were already hundreds of search engines available, some of which had significant market share. At the time, GOOGLE could have easily been seen as a terrible idea. However, as we know now, GOOGLE revolutionized web search. Sequoia invested in Larry and Sergey as opposed to the idea. That is not to say the idea has no merit, but the team is highly weighted when compared to the idea.

http://www.startupdojang.com

]]> By: webwright http://www.tonywright.com/2010/guide-to-evaluating-startup-ideas/#comment-598 webwright Sat, 05 Jun 2010 06:09:27 +0000 http://www.tonywright.com/?p=245#comment-598 Yeah, don't get me wrong, I think Redbox is killing it. They have a great<br>short-term value prop and their growth is impressive! But if I was going to<br>dedicate my life to a startup and had a potential co-founder who was jazzed<br>about creating a RedBox competitor, I'd be leery. I think RedBox is on the<br>same train that Blockbuster is on, which is going over a cliff. Their<br>train-car is just farther back in line. Of course, who knows about timing?<br> RedBox might have 10-15 years of legs for all I know.<br><br>Markets are hard to guess about though. Everyone with a brain thought<br>search engines were a non-opportunity when Google came around. When the<br>first iPod hit the market, was anyone thinking that MP3 players was a market<br>waiting for someone to come in and clean up? Yeah, don't get me wrong, I think Redbox is killing it. They have a great
short-term value prop and their growth is impressive! But if I was going to
dedicate my life to a startup and had a potential co-founder who was jazzed
about creating a RedBox competitor, I'd be leery. I think RedBox is on the
same train that Blockbuster is on, which is going over a cliff. Their
train-car is just farther back in line. Of course, who knows about timing?
RedBox might have 10-15 years of legs for all I know.

Markets are hard to guess about though. Everyone with a brain thought
search engines were a non-opportunity when Google came around. When the
first iPod hit the market, was anyone thinking that MP3 players was a market
waiting for someone to come in and clean up?

]]> By: webwright http://www.tonywright.com/2010/guide-to-evaluating-startup-ideas/#comment-597 webwright Sat, 05 Jun 2010 00:18:14 +0000 http://www.tonywright.com/?p=245#comment-597 That's a fair point (regarding consumer/hockey stick). This is a startup<br>focused... My personal definition of "startup" is a "newish company that's<br>aiming for rapid growth and equity upside". Lots of people have different<br>definitions of a startup, which is fine. If your definition is radically<br>different, then take this post with a grain o' salt.<br><br>My examples are often consumerish (heck, I'm a consumer!), but I think these<br>generalize to b2b businesses as well. Solving a "hair on fire" business<br>problem is probably quite a bit more powerful than just about any consumer<br>play. That's a fair point (regarding consumer/hockey stick). This is a startup
focused… My personal definition of “startup” is a “newish company that's
aiming for rapid growth and equity upside”. Lots of people have different
definitions of a startup, which is fine. If your definition is radically
different, then take this post with a grain o' salt.

My examples are often consumerish (heck, I'm a consumer!), but I think these
generalize to b2b businesses as well. Solving a “hair on fire” business
problem is probably quite a bit more powerful than just about any consumer
play.

]]> By: webwright http://www.tonywright.com/2010/guide-to-evaluating-startup-ideas/#comment-596 webwright Fri, 04 Jun 2010 05:37:10 +0000 http://www.tonywright.com/?p=245#comment-596 I *almost *wrote a bit about people, but was trying to stick with evaluating<br>IDEAS... But your point is dead on-- people are damn important. Not only<br>for the success of the business, but for just enjoying how you spend your<br>day. I tend to be a bit contrarian on people-importance however -- I tend<br>to think the market is the most important thing by a wide margin. I'd take<br>a C level team working in a grade A market over the inverse any day (you can<br>always fix a team-- fixing a market is harder). Of course, I'm just being a<br>parrot here... See: <a href="http://pmarchive.com/guide_to_startups_part4" rel="nofollow">http://pmarchive.com/guide_to_startups_part4</a> I *almost *wrote a bit about people, but was trying to stick with evaluating
IDEAS… But your point is dead on– people are damn important. Not only
for the success of the business, but for just enjoying how you spend your
day. I tend to be a bit contrarian on people-importance however — I tend
to think the market is the most important thing by a wide margin. I'd take
a C level team working in a grade A market over the inverse any day (you can
always fix a team– fixing a market is harder). Of course, I'm just being a
parrot here… See: http://pmarchive.com/guide_to_startups_part4

]]> By: Willis F Jackson III http://www.tonywright.com/2010/guide-to-evaluating-startup-ideas/#comment-595 Willis F Jackson III Wed, 02 Jun 2010 02:52:47 +0000 http://www.tonywright.com/?p=245#comment-595 Nice post. I think you are wrong about RedBox though. In the long term, they are on the wrong side of the market. In the short term, they are cannibalizing staffed store sales (think Blockbuster) pretty hard by resegmenting the market. Nice post. I think you are wrong about RedBox though. In the long term, they are on the wrong side of the market. In the short term, they are cannibalizing staffed store sales (think Blockbuster) pretty hard by resegmenting the market.

]]> By: Willis F Jackson III http://www.tonywright.com/2010/guide-to-evaluating-startup-ideas/#comment-594 Willis F Jackson III Tue, 01 Jun 2010 19:52:47 +0000 http://www.tonywright.com/?p=245#comment-594 Nice post. I think you are wrong about RedBox though. In the long term, they are on the wrong side of the market. In the short term, they are cannibalizing staffed store sales (think Blockbuster) pretty hard by resegmenting the market. Nice post. I think you are wrong about RedBox though. In the long term, they are on the wrong side of the market. In the short term, they are cannibalizing staffed store sales (think Blockbuster) pretty hard by resegmenting the market.

]]> By: Vikas Shukla http://www.tonywright.com/2010/guide-to-evaluating-startup-ideas/#comment-602 Vikas Shukla Sat, 29 May 2010 09:59:00 +0000 http://www.tonywright.com/?p=245#comment-602 I originally stared the Finance and Stocks forum at http://diggsamachar.com/adrforum to discuss the stocks and ADRs ( American Depository Receipts) - primarily because I had good interest in the stocks and also to enable interaction and discussion about the stock market. It went very well. People posted relevant and good messages. To award some of them I enabled the signature which allowed people to put links to their blogs or website. But this led to the decrease in the quality of the people. How can I ensure that the quality of the messages do not go down when I enable signature ? I originally stared the Finance and Stocks forum at http://diggsamachar.com/adrforum to discuss the stocks and ADRs ( American Depository Receipts) – primarily because I had good interest in the stocks and also to enable interaction and discussion about the stock market.

It went very well. People posted relevant and good messages. To award some of them I enabled the signature which allowed people to put links to their blogs or website. But this led to the decrease in the quality of the people. How can I ensure that the quality of the messages do not go down when I enable signature ?

]]> By: webwright http://www.tonywright.com/2010/guide-to-evaluating-startup-ideas/#comment-593 webwright Fri, 28 May 2010 15:41:59 +0000 http://www.tonywright.com/?p=245#comment-593 Hi Arthur! Thanks for commenting!<br><br>I like #4 as a different animal. Insanely useful (or addicting-- like Twitter or World of WarCraft) is always my #1. But you can imagine a product that was insanely useful, but ONLY for left-handed dentists. Or mothers with twins. A lot of insanely useful products have small markets that are hard to break out of. Some small markets can expand (like Craigslist did out of SF or like Amazon did away from books).<br><br>But the #1 and #4 are definitely kissing cousins. Given that it's a big world you can always expand like Amazon did, I think #4 really is only a big consideration if you want to have a HUGE "change the world" impact. Maybe you only need 1000 true fans?<br><br>See: <a href="http://www.kk.org/thetechnium/archives/2008/03/1000_true_fans.php" rel="nofollow">http://www.kk.org/thetechnium/archives/2008/03/...</a> Hi Arthur! Thanks for commenting!

I like #4 as a different animal. Insanely useful (or addicting– like Twitter or World of WarCraft) is always my #1. But you can imagine a product that was insanely useful, but ONLY for left-handed dentists. Or mothers with twins. A lot of insanely useful products have small markets that are hard to break out of. Some small markets can expand (like Craigslist did out of SF or like Amazon did away from books).

But the #1 and #4 are definitely kissing cousins. Given that it's a big world you can always expand like Amazon did, I think #4 really is only a big consideration if you want to have a HUGE “change the world” impact. Maybe you only need 1000 true fans?

See: http://www.kk.org/thetechnium/archives/2008/03/…

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