How much proof of concept do I need to get a good deal from investors?
My two-year-old software business has developed a mobile technology offering picture and text-based translation services for English speakers abroad. I’m keen to raise finance and pitch to mobile operators, but feel I need greater endorsement and protection first. How would you advise going about this?
A. Ben White of MessageLabs writes:
Have you commissioned any market research in the target countries to establish your product’s unique features and operating attributes? You also need to consider intellectual property protection in the form of a patent and you should consider trademark protection; a search via the online databases is a good place to start for free.
Raising finance can be difficult, so make sure your business plan and P&L (profit and loss) stacks up – how much money are you going to make and when? You need to consider how much you really need and whether you are convinced that you really want to give up hard-created equity. Could you do a family and friends round first?
The mobile operators are a hard nut to crack – they have seen it all before and they generally go where the water flows fastest. Do you really have to get them on board and could you enlist the help of a freelance group to help you?
Next, research capabilities, geographic coverage, target audiences and supplier partnerships of individual mobile operators – a bit of desk research will help you create a tailored presentation and eliminate time wasters. Make sure you know your target audience; you will only get one chance so make it count.
Greater endorsement could be achieved by partnerships with the likes of IBM rather than the operators. All the big systems integrators are looking at mobile applications and mobility is a hot button.