Many entrepreneurs think that if they have a brilliant idea, they can easily get funded. They immediately embark on a fundraising journey, pitch at multiple investor meetings, and are flabbergasted why, to their genuine surprise, the answer is consistently “NO”.
What is the problem? Why is it so hard to raise money even if you have an idea that can be worth billions? “CAN” is the key here, as we discuss in this article and the corresponding video.
The concept of “great craftsmanship”
In his interview, Steve Jobs, a visionary inventor and entrepreneur, discusses what it takes to transform disruptive ideas into ground-breaking products. He introduces the concept of “great craftsmanship” - a key ingredient to make the transition succeed . It further follows that just because you have a great idea, it does not automatically mean that you also have the great craftsmanship required to create a great product based on that idea and to build a great company.
That is precisely why investors are reluctant to give you funding just based on an idea. You must prove you can execute first.
Who can raise money on an idea?
An experienced entrepreneur. If Steve Jobs walked into any venture capital office and said: “Give me $10M (or $100M), I want to work on a new product”, he would easily get it. In fact, VCs would be fighting over who gets to invest in Steve Jobs’ next venture.
The reason is that he has a proven successful track record of launching and scaling companies. He understands what it takes, the processes that must be put in place, how to hire the right people, and how to react to market feedback. In summary, he knows how to get things done.
What about the rest of us?
The rest of us must first demonstrate to investors that we have this great craftsmanship to make the magic happen and make them a lot of money.
You can show investors you have great craftsmanship by creating a stellar MVP, writing a thorough business plan, and generating product traction.
What is an MVP? - A glimpse into your craftsmanship as a creator.
What is a business plan? - A glimpse into your craftsmanship as a CEO.
What is product traction? - A glimpse into your craftsmanship as a marketer.
While your ideas may be great, even brilliant, they alone are not enough to secure funding. To learn more about how to evaluate the financial feasibility of your ideas, take our Course #2.
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