A venture usually goes through three stages. The first is Venture Proposition which involves deciding, shortlisting and finalizing a Proposition. The second is creating a Venture Plan. And then after the venture is launched, the on-going work of Venture Management which involves building and growing the Venture up to and beyond the point where it provides a financial return to investors.
How would you and I go about finalizing a proposition? It would probably follow a few natural steps. But our path for Venture Proposition is just designed to ensure that we turn those natural steps into a systematic process. And then follow each step without skipping over any one of them because of excitement or oversight.
First, an idea comes to us. How does it occur to us? In a hundred different ways. Because we encountered that problem or current trends indicate a new opportunity, or because we’ve worked with clients or partners who’ve faced it before, and so on.
The tagline of Prototyze is ‘Ideas to Business’. We’re not (yet) trying to create a process of generating ideas. We’re currently focused on asking “AFTER an ideas comes to us—no matter how it comes to us—how can we assess if it can be turned into a viable business”
This is the usual path and our processes which map that path of turning Ideas into Businesses.
- First we need to understand the Landscape of the sector. Why? Because choosing the sector (and estimating potential target market-size) is a critical aspect for most investors. Often it is more important than even the leadership
- List possible Propositions, finalize a shortlist and prepare to score them comparatively to select ONE. How?
- Create a Proposition Summary for the final proposition(s), and validate whether or not we should create a venture around this proposition, both internally as well as through external advisors or evangelists.
After this, we create a Venture Plan. This has 4 elements:
- A Venture Blueprint document that captures the proposition, competitive differentiation, Go-to-market strategy, Business model, Competitive landscape, Product and Technology roadmap, People Plan. Key Annexures to this (A) Venture Hypothesis document that outlines the key hypothesis we will be evaluating the venture against; (B) Venture Milestone document that lists the milestones on a monthly and quarterly basis
- A Venture Highlights note which is a simple summary of the Venture Blueprint in <500 words, designed to be easily sent by email and serve as an introduction to the venture
- Financial MIS that includes a P&L and cash-flow projection for 3 years as well as the key metrics that we track, and an initial 12-18 month budget
- Investor Presentation which is just the above content in a visual, slide-centered format, and answers some of the typical questions investors have for new ventures.
This is broadly equivalent to what is traditionally called an ‘Information Memorandum’ in investment banking. However, our Venture Blueprint is usually shorter (8-12 pages instead of the 40-60 pages of a typical Info Memo) and written in a more practical, interesting and intelligible—therefore less formal or legal—style.