Investors’ frustration vs. satisfaction:
It is frustrating for Investors to interact with “dreamers” who think they have the best idea or prospect business in the world, without any basis whatsoever. The same Investors have this sense of pride, satisfaction and success in funding true value making entrepreneurs.
What makes a difference between the dreamers and the true value makers then?
In general, they identify a need or a problem, and develop an idea about the response to that need or solution to that problem. Their gut feeling tells them that, with this idea, they could make a change, bring value to others and possibly make a good profit out of it.
In some cases, they start to convince others to buy-in to their idea for a possible business partnership or funding etc., generally in vain. In other cases, they share their thoughts with their close friends or family members who have no interest in the idea, but show some compassion and mental support.
Most of the dreamers, end up keeping their ideas in the warm…in their mind.
True value makers:
They may share the same triggers for their ideas as the dreamers, but their approach is somehow different. They realistically evaluate whether their idea is just a fade, or can lead to something important in their life and in the life of others. They develop the value proposition associated with this idea, study the fit of the idea with the market, etc. With this, the value makers will have a better chance to convince others about their idea, given the fact that most of their statements are data driven and deeply analyzed.
How to change from a simple dreamer to a true value maker?
Most people with valuable ideas give up quickly because they could not find a simple system to convert their idea to a value making opportunity or business. They spend most of their time online learning, learning and learning new information to end up feeling that they don’t know much. This is unfortunate because their ideas might have genuinely benefit others.
With its very affordable pricing formula, Vamaks provides a systematic way for idea or small business owners to change progressively from simple dreamers to nurtured entrepreneurs. This process helps them to save time, money, effort and to make sure that all necessary business components are considered.
Vamaks members know quickly that they should be prepared sufficiently before seeking for funds or any sort of partnership. How?
The very first step for the idea owners who join Vamaks is to complete the Sanity Check, a comprehensive assessment process (owned by Vamaks) distilled to:
- Allow to evaluate whether their ideas or businesses have a potential for true value creation.
- Help assess the extent of work they have done to take their ideas or businesses off the ground
- Activate thoughts about the sustainability of their venture.
- Help identify what was overlooked in the past unsuccessful venture if any;
- Provide support for stronger business model development;
The next step is the analysis of the results. At this stage, they have a better perception about the potential of their idea to convert to a valuable business.
Then, they start addressing the areas for improvement, and complete the missing tasks to increase the chance for the success of their venture. For this, Vamaks members are provided with the necessary tools and a very rich set of content. They also participate in an online forum where meet with like-minded members, mentors and investors.
If after the analysis of the idea is found not worth the time, effort and money, members will make that hard decision to stop it, knowing that it would have been worse if that information came at a later stage. No matter how others might think, this is a sign of success.
If the idea shows a good prospect to succeed, the owner of the idea will continue further and complete the financial analysis started earlier to check if any external funds are required to start a small business, and when would they be needed.
At this stage, Vamaks members can clearly present their project to Investors or others with confidence and with the ability to answer most of the questions, if not all.
Responsibilities of Idea owners:
First and foremost, the idea or business owner seeking funds shall be honest.
There are too many pitfalls associated with presenting projects to investors. First, there is something called “self-fulfillment prophecy”, that is, as defined by businessdictionary.com: “Any positive or negative expectation about circumstances, events, or people that may affect a person’s behavior toward them in a manner that causes those expectations to be fulfilled”.
Some naïve entrepreneurs believe so hard in their projects that they easily misguide the investors by their responses during their discussion or interview.
The second pitfall is rather advertent, like tweaking results or changing information from a business plan or other documentation to gain favor and please. This will prove to be disastrous for the entrepreneur for the only reason that all misbehavior acts will be unveiled sooner or later.
Let’s be more practical and let’s pick three scenarios about the behavior of idea owners (entrepreneurs), then you decide where do you want to be.
An entrepreneur presents a “seeming” concise business plan to a seasoned Investor with some fake niche market data. The investor’s gut feeling and experience don’t accept that information, so he digs deeper and discovers some disconnects in the information. You can imagine how embarrassing is the entrepreneur’s situation!
The entrepreneur presents fake data to an investor who trusts blindly the efforts made by the entrepreneur. This time, the investor doesn’t have any clue about the misleading data. So, he provides the fund against an agreed upon equity, and the deal is done. Sometime later, both parties realize that the response of the customers from that niche is not as planned at all, and the business is collapsing. This is a double jeopardy resulting in loss money, time and effort, and embarrassment.
The entrepreneur has done the necessary work, presented the project to the seasoned Investor, and addressed all the outcome without any tweaks whatsoever. The investor has enough experience to realize that the entrepreneur was focusing the efforts on the wrong niche market. So, he made his comments and suggested to modify the business plan accordingly. The new plan makes more sense and the business has a better standing now.
If you study your business idea from all the necessary angles and realize that its potential for converting to an opportunity is low, or it doesn’t bring a true value to others, you will be more successful than many entrepreneurs if you decide to stop it there.
Responsibilities of investors:
Investors have also their part of responsibility.
They must keep their word:
Unless there is a force majeure, or, the potential for the business has changed dur to some external factors, investors shall maintain their positions in front of the entrepreneurs.
Investors have ethical obligations:
Also, Investors have the ethical obligation to maintain the privacy / secrecy of the idea or the business model etc…even if it was not requested by the entrepreneur. Although Vamaks doesn’t provide any legal advice, Vamaks members are provided with sufficient tools to help them take necessary precautions and understand the importance of enforcing the non-disclosure and non-compete agreements etc. before making any arrangement.
Investors should share a win-win mindset:
It is in the interest of the investors to share knowledge. The more constructive information they give, the more they gain in the loyalty of the entrepreneur, that leads, in general, to a smoother partnership and a long-term business relationship.
Yes, there is a big difference between dreamers and true value makers in the entrepreneurship world. As an idea owner (or entrepreneur), you should put yourself in the shoes of the investor before seeking for funds. You would need to do some homework beforehand.
Idea owners have ethical responsibilities towards the partnership they seek with investors. Similarly, Investors have the responsibility not to fail the entrepreneurs by changing their mind without any valid reason. They should also keep the privacy and secrecy of the idea or the business model etc.
Vamaks provides an easy way to help idea owners change from dreamers to true value makers. The same way, Vamaks reduces the frustration of the investors.
Good luck with your endeavor,
B.M. from Vamaks