Augusto Coppola is the patron of InnovAction Lab, the largest event of its kind in Europe, involving young university students from all over Italy and potential investors. In the history of the event, there have been hundreds of encounters between aspirant startuppers and investors, and about thirty new companies created. It’s as if he’s the lynchpin in a very accurate mechanism. He designs and prepares the initial contact with the market, and checks and regulates the “engines” ready for the launch. On the eve of the next final of InnovAction Lab 2013, he’s given us the five most common errors he’s noticed in new startups.
1) Not knowing the market. Does the idea already exist?
“Young people often come to us with an idea without even having checked on Google whether it already exists or has been produced. They don’t check whether or not it’s on the market. There are lots of people reinventing the wheel and this shouldn’t be necessary because, really, the first thing to look at is if you’ve got any competitors and what sort of market you want to appeal to. So, my advice is: at least take a look on Google first.”
2) Not knowing the target market and potential customers
As often happens, the second error is a consequence of the first. As Coppola says: “Not only have they not checked whether it exists, they haven’t even consulted their potential customers to ascertain whether the idea might interest them, or how to best to present it. For example, amongst our startups, there’s one concerned with baby-sitting. I sent her off to talk to both baby-sitters and customers to learn what they can offer and what they actually need.”
3) Badly designed business plan
Presenting a badly designed business plan is a bit like making a mistake in your CV or wearing a dirty shirt to your first appointment. In fact, the internet offers lots of courses and advice about how to devise a business plan for presenting your idea, so you can at least go and read how to do it. Otherwise, as Coppola says: “the final effect is one of confronting people who are incompetent, or, worse still, arrogant, and who haven’t had the humility and intelligence to learn how to present their idea.”
4) Spouting a pitch which is too long or unclear
The pitch, the presentation of the idea to investors or to whoever is important should be the moment you put the greatest care into. These are the “fifteen seconds of fame” when you have to give of your best. And you can’t improvise your best. You have to know the market, and be clear in explaining your idea, its development, the goals you wish to achieve and your startup team. If you can’t put across your idea with enthusiasm, determination and conviction, who’s going to believe in you?
5) Not being humble
You must be humble. And have respect. Even if your idea is wonderful, don’t present a 5-year business plan: start with 12 months and let’s see who survives.