Learning From Business Plan Competitions

A young company can learn from competitions like New Ventures BC.

A young company can learn from competitions like New Ventures BC.

This year’s New Ventures BC competition wrapped up recently, kicking off the annual round of business plan competitions and VC forums. Winners are listed at newventuresbc.com. Congratulations to all.

It was a tough competition, and as someone who sat on several mentor panels hearing business plan presentations, I was quite impressed by the quality of many of the entries.

But, as usual, some weren’t as far along the track. So, to help other businesses launch and grow, I thought I’d share a few questions panelists asked regularly.  

What exactly do you do? Too many presenters emphasized the great credentials of their teams, or the size of their potential markets. But often they didn’t adequately explain what their businesses were about. Sure, they all did in a way, but not that clearly.  Lose the marketing speak and sum up your value proposition and the business opportunity in a sentence or two. Tops.

How are you going to make money at this?  I wanted to have just a piece of the action on the spreadsheeting that was done to convince judges these would be viable businesses that would eventually show a real profit. But all the bafflegab in the world can’t disguise the fact that your business might be more suitable for a niche – which isn’t a bad thing, by the way – than for scaling up to something that’s going to excite investors.

Isn’t this very similar to …? Each year with most business plan competitions, there is a lot of derivative stuff. Some business trend is the flavor de jour, and several companies jump on it. They don’t seem to realize that they’re all competing in the same space and aren’t all going to make it. So, find something that’s going to make your business stand out from the crowd.
 
This seems overly complex? Since the NVBC competition is sponsored by the BC Innovation Council, it tends to draw many technology startups. For some reason many of these fall down on the basic principles of product development and deployment: That, to be commercially viable, it has to work seamlessly and be easy to use. While the technology or science behind the product can be incredibly complicated, the business can’t be. The KISS rule should always apply. Don’t let the geek factor spill over to the business arena.

What’s your exit strategy? Contestants often focus so much on startup and launch they don’t know where they’re going to end up. These days, if you don’t have a clear plan for exit, i.e. sale, or some other form of ownership, within a few years, you’re dead.