Robert Ochtel’s Blog

An Experienced Approach to Venture Funding

Entrepreneurs, Bringing a Product to Market Requires Commitment

Planning, whether it is strategic, tactical or product planning only goes so far.  Sooner or later you have to get off the planning sideline and begin to bring your product to market. The decision as to when and how to bring your product to market requires commitment.  This commitment takes many forms, not least of which is the decision on how to initially fund your start-up company.  Today with many angel and venture investors requiring a working prototype, and even revenue before they will invest, it is often up to the entrepreneur to determine how to fund their initial product offering. More often than not, the monies for funding a given start-up company comes from the pocket of the company’s primary founder and visionary. In most cases, this decision to fund the start-up company and get its initial product to market is a big one and should not be taken lightly, as it can affect an entrepreneur’s financial stability, their personal relationships, and ultimately their future.  In what follows is a short discussion on issues the entrepreneur must concern themselves with once they have made the decision to fund their initial product development to bring their product offering to market.

Pick a Hard Date

One of the first things to consider, once you have decided to bring your product to market through self-funding, is when are you planning to introduce your product to the market.  This can be a date, month, an event, etc., but you must pick a “hard” date.  Why, because nothing really starts to happen until you pick a “hard” market introduction date. Once done, this hard date puts a stake in the ground that everybody on the team knows they must meet.  More often than not, trade shows are great events in which to introduce your product offering to the market, as they provide a natural forum to introduce your product offering via the press, talking with customers, and meeting with potential strategic partners. By picking a hard date you are telling your team we need to hit this date and it is their responsibility to make it happen.  It also provides a point in time in which to judge your progress on product development activities. Finally, picking a hard date provides a reason to go back and talk with you potential customers.  They ultimately will not be interested in you, your start-up company, or your product offering until you provide them with a time frame as to when your product will be available in the market. This also provides them a time frame, if interested, as to when they can “touch” and “feel” your product offering to determine if it fits their needs.  So pick a hard date, it will allow you to support both internal development activities and external business development activities with your customer base.

 Focus on the Details

Once you have picked the date for your product introduction, you need to sweat the details of your development.  This includes not only developing a schedule, but understanding all of the details of the development, including:

  • How you are going to staff the development?
  • Where are the unknowns?
  • Which tasks will take longer to develop?
  • Which development tasks do I prioritize over others?
  • What features, functions and capabilities do I move to the next development phase?

Knowing and understanding the details of your development requires time and effort.  Nothing will happen by itself.  You need to delve into the details of all aspects of your development, so they you can have a predictable out come.  This is especially true with limited funding.  You do not want to be caught short of funds in the middle of development.  So, you need to take the time to determine all of the details of the cost of your development. This includes getting multiple bids on all aspects of your development.  Once you have a handle on this, you can have some assurance you are going to hit your cost and schedule targets.  This does not mean that there will not be road blocks along the way, but if you have done your homework, you will have minimized the adverse affects of any of these unforeseen issues which then will allow you to meet your development cost and delivery schedule goals and objectives.

Manage the Schedule

Finally, once you have picked a “hard” date and understand all of the details of the development, you need to take a hands-on approach to managing the schedule.  As we all know, everything tends to move out in time to the right.  So, given you have a hard date, you need to be on top of the development by managing all aspects of the schedule, from the locating and hiring of individuals and development teams, to the ultimate delivery of the final product offering, and everything in between.  This schedule management takes lots commitment, time and effort.  If you do not spend the appropriate amount of time managing the schedule, in the end, you will not meet your commitment date.  Also, it should be remembered that schedule slips in minor parts of the development can have a major affect on your overall schedule. So take the time to manage all aspects of your development schedule.  It will pay dividends in the long run.                              

Bringing a product to market requires commitment. At the point in time that an entrepreneur makes the decision to self-fund their product development, the game then changes from a planning activity to a product development and execution activity.  Now, as an entrepreneur, you need to be on top of your game to meet all of the development commitments. This includes picking a hard date to introduce your product into the market, focusing on and understanding all of the details of the development, and managing the schedule to ultimately bringing your product to market.  By doing this, you will provide yourself a chance for success and smooth your development path to meeting your goal of bringing your product to market within budget and on schedule.

This information was taken from Robert’s new book: “Business Planning, Business Plans and Venture Funding – A Definitive Reference Guide for Start-up Companies”.  Available at www.amazon.com.

Advertisements

September 6, 2010 - Posted by | Venture Capital

No comments yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: