At this point, your value is the research that you have done and the
ideas
that you have. You must now convert that "need" in the marketplace to a
revenue generating solution model that you want to propose b/c a VC will
not
bet on you for your research but your research and your PLAN!
Here's what I would do:
1. Come up with a business plan.
2. Work on a prototype (even if it's not functional, but something to
visualize your ideas)
3. Come up with an "Elevator Story". If you had 30 seconds in an
elevator
with an investor, what would you say about your company?
4. Prepare to answer questions about barrier-of-entry, competitors,
revenue
streams, and the problem that your solution is solving. If it's a
service
solution, why wouldn't a company want to buy a product or implement it
themselves? Plus, how much money do you need, how would you spend it
and
for how long? What's the revenue projections for the next year?
5. You might start seeking investors within your own family, friends,
etc.
6. I would work with your future clients to investigate that the
solution is
good...you might also find an investor in them.
7. Then start looking into things like garage.com and roundzero.com to
meet
investors and pitch your idea. You can also try these incubators such
as
idealab.com, ehatchery.com, intendchange.com, ctp.com, ac.com, etc.
(they
provide $$ and management experience for equity).
8. If you get #6, then companies like *BLATANT PLUG* Synapta *END PLUG*
provide the technology portion of the equation for Internet startups.
I tend to think that investors like to see their entrepeneurs invest
their
own hard in cash before they invest theirs. (I would) I know companies
where the entrepeneur started off on credit card charges/debt to finance
their operation and eventually succeed in an M&A.
As for the online service, this may not be as hard of sell as you might
think. Most VCs will make sure that you pick one or the other (either
product or service) and not try to do both. Plus, these days, VCs like
to
the service option, because that is the way the world is going. While
you
might be attracted to the product option because of the easier model for
revenue generation, the managed service model most likely will be better
route (of course it depends on the solution).
good luck, (boy, I'm long winded today.....apologies)
/kso
Kuldip Oberoi
Synapta
http://www.synapta.com
1129 San Antonio Road
Palo Alto, CA 94303
ph: 650.962.7287
fx: 650.967.3701
[email protected]