A bright, overarching vision is an important thing in selling investors on a company. The trick is to recognize the series of tasks that need to be accomplished in order to realize that vision. It’s just not possible to reach the final vision without constant blocking and tackling along the way. It’s also critical to realize that these interim proof points are the prerequisites to attracting the interest of investors.
I run into a lot of companies that want to jump from the startup idea to the completed grand vision. It’s entirely possible that a startup can raise an angel round largely on the strength of the grand vision. Once that’s accomplished the focus of the investors (and by necessity the founders) changes from potential to actual results. These days, results are about demonstrating traction. And traction is about getting and keeping customers. It’s about knowing your cost of customer acquisition and lifetime value of the customer cold.
This is hard work; it is far less glamorous than announcing new products and honing your pitch for investors. But it is what works. It’s what puts you in a position to keep raising capital and it’s what actually builds value for you and your investors. As the challenge of getting Series A investment increases nationwide this is literally the difference maker for the companies that get financed as opposed to those that are forced to bootstrap.
Given this, why do many teams spend a lot of time on matters that don’t provide the hard evidence you need to make progress with investors? Psychology and personal comfort levels are no doubt part of the issue. Most people like to work on tasks and parts of the problem that they are most comfortable with. Obtaining proof points by rigorous testing of assumptions and strategies is not for the faint of heart. It requires clear-eyed focus on process, perseverance and a willingness to be taken where the data leads you. That said, the rewards of this discipline pay off over and over again. Even if you don’t plan or want to raise outside capital, the testing path should still be part and parcel
So, the focus should be on the step by step proof points that will build your vision. That’s what will put you in the position you want to be in when 2016 arrives. This focus should permeate all decisions of the company. Is the money I’m about to spend something that advances the proof points that I need? Is the team as currently constituted the right team to prove the things we need to prove? Is the customer request a distraction or something that aids the company in proving it’s value? It’s 2013 now, not 2016!