That is really the purpose of the beta test. Early users know that this is in early stages -- but they can provide you very valuable feedback. Many local startups have been extremely successful in launching companies following Lean Startup principles -- get your minimally vialbe product out there and then get feedback early and iterate.
Cupcakes! All kidding aside, I think we are seeing alot of activity in the food space. Look at trends around specialy restaurants - burgers, cupkakes, frozen yogurt. Also a lot around organic, locally grown foods.
There is also a blurred line in my cases between tech and non tech -- a lot of product companies now sell on line. Is that a product or tech because they have a website. Startups around improving education and healthcare have no shortage of problems to solve.
It is very hard to get angel funding for non-tech business -- I actually wrote a blog post recently on this very issue. I'd suggest talking to a bank and trying to get a small business loan. The reason angels don't invest is often because there isn't an exit strategy. A hair salon can generate nice profits for the management, but angels typically like to see a return from an M&A transaction.
I still think the limitations on the keypad may limit ipad use currently vs. laptops b/c you still can't type that fast, but I can see how the penetration of ebooks might change that. I'm seeing a lot more people use ipads in meetings, so I imagine students will be adopting as well.
The one that will be the most profitable will be the one you are most passionate about. I don't mean to sound cliche -- but starting a business takes a lot of time and risk, if you aren't passionate about it it isn't worth it. Talk to a lot of people and rethink possible business models that might take your idea in a different direction where it could be "more" profitable.
Our network does not -- there is a local venture firm called DC Community Ventures that looks for double bottom line -- for profit but socially impact. There are some "philanthropic" funds that don't seek a return but invest in non profits. NewSchool Ventures is an example of that kind of fund. Most investors give philanthropically to many causes, but see investing as a for-profit activity. That being said, Ryan Seashore from CodeNow presented to the Dingman Center Angels and made a great impression! I'm hoping to see a number of our angels get involved with that organization.
A cousin and his wife recently started a business which is now, months later, on the verge of failing. (i.e. they haven't paid rent on their office, laid off most of the employees, owe money to the IRS for taxes not paid, etc.) This is not a surprise as he did not have a good or vetted business plan, and ignored common sense things like talking to the free advisors available in our city's chamber of commerce program, setting aside money for start up mode, making an appointment with an accountant to plan for taxes, etc.
In the meantime, he is sending out lots of emails asking for us to vote for their business in a contest or refer our friends - I don't mind clicking a link for a contest, but I won't refer them for work as I can't be confident they will be around to follow through. They also convinced dozens of family members and friends to invest in their business to the tune of several thousand dollars (or more) each - if this business goes under, none of this will be repaid, is my understanding.
I did not invest, other than friendly emotional support, knowing this would likely fail, but my question is - when it comes to this point, what can family and friends do, if anything? When it goes under, the folks who invested will likely drop them, so I might be one of a few people they have left who will still talk to them! I love my cousin, but he's an idiot who never should have gotten himself into this mess.
Sounds like you'd done well keeping your relationship family-only with this cousin. I'd stick with that and not make references (sorry cuz) BUT try to help him think through what has gone wrong this time and what he could have done differently. Most successful entrepreneurs have failed at one point, but they want to prove they can succeed the next time. He just may have to find new investors this time around.
You are welcome. This issue comes up very often, so you are not alone in this dilemma. Investors at all stages rarely sign NDAs because they often speak to so many companies and can't be precluded from an investment opportunity. If you aren't already in prototype or beta testing stage, you are probably too early to even talk to investors. Select advisors that you know and trust for early feedback -- and then conduct market research to determine if you are solving a problem or creating a product that potential users will find valuable. I think there are very few example of investors stealing an entrepreneurs idea -- they have reputations on the line as well.
I always suggest the CEO should pitch b/c at the end of the day you are also the chief selling executive. Investors want to feel comfortable that you will be able to sell to customers or other partner who you need to sell on your vision. Like anything, pitching takes A LOT of practice. We spend a lot of time coaching students and local entrepreneurs on their pitches b/c it is for more than just raising $$. Find some advisors and coaches who will help you -- you'd be surprised how much progress you can make. Also, find the venues where you feel comfortable. Pitching investors doesn't have to be in a crowd, one on one meetings are also very successfuly in buiding rapport.
The local restaurant scene is very competitive, so the old adage on location holds true. If you are in a less desirable area, you'll have to spend more $$ on advertising to drive traffic. If you already have a brand, then I'd say you could sacrifice location, but as a new restaurant you could end up with cheap rent and a lot of leftover pizza.
This is a hard question without knowing more about the business. I think you can learn more by talking to your customers -- do they like your product but aren't comfortable with price or delivery? Are customers happy to try something for free, but don't see enough value to pay for it?
There are a couple of ways to go about it -- think about the things that you are most passionate about -- and the things that drive you crazy. What are your "I always wish there was a place to do this..or a way to do that?" Where do you see people waiting in lines...and why? Talk to your friends and colleague about the businesses they've always wanted to start. My mom is a great example, she retired and started getting into writing because she always kept a journal. Now she is thinking about starting a business that gets groups of people together to write about shared experiences.
I know the answer "it depends" is not very satisfying, but hard to give a blanket answer. Any startup can benefit from a variety of experiences and expertise -- some from school, some from working in different types of organizations. For highly specialized and high tech industries, advanced degrees are obviously valuable and add credibility. MBA's can be valuable as startups grow and need to be able to analyze new markets, analyze strategy and help grow organizations.
Entrepreneurs have thick skin, so they usually appreciate the "no" rather than thinking they have a committment. Answer in the same way you'd answer in a typical professional relationshp, give reasons but perhaps also offer to give some advice or feedback if you are interested. Also give honest opinion, particularly around the business model. You aren't doing any favors by sugar coating b/c I'm sure they value your advice.
I had recommended the Business Model Generation book in one of my previous posts. The planning canvas is a GREAT way to get started before writing a full business plan. Business plans are used more for internal planning, while a shorter executive summary or canvas can be used to get early feedback on your idea.
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