The key to the management team is experience in the area of the new business. First time CEOs need to have substantial operating experience. In addition to the CEO most startups have two other executives on board. Depending on the business, they could be financial, operational, manufacturing, scientific, technical, or other. Again, industry-specific expertise needs to be highlighted. Startups without a full management team could create an “Advisory Board” staffed with non-paid volunteers who provide advice. Typically, they have substantial industry experience and can augment the management team.
Pitching to Angel Investors: Defining the Target Market
In an earlier post, we talked about framing a compelling customer problem for a potential investor--but to truly get their attention, your target market must be sizable. In other words, there needs to be a lot of customers with that problem that are ready to pay for your solution!
I usually break the “target market” category into three pieces: Available, Serviceable and Beachhead.
The Available Market is typically anyone who could potentially purchase the company’s product or service. Look for numbers in the billions to truly be compelling.
The Serviceable Market is the sub-segment that would most likely be a strong candidate to purchase the company’s product or service. This number is usually in the millions of dollars.
And finally, there’s the Beachhead market, which is the first set of customers the company will pursue. The company should list beachhead customers that are in the pipeline which shows market validation.
Conveying these three items in your business plan and pitch presentation will show an investor that the market cap is sizable, that there are may companies willing to buy your product, and you have a solid go-to-market strategy.
Best Regards,
Hall T.
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