Source | Entrepreneur : By Komal Nathani
Amid a host of questions posed by the startup community on our social media pages every day, the most common are the ones related to hacks of raising investment or how to impress an investor or what are investors’ choices in the market.
To come up with a sound reply that can solve the most common yet biggest problem startups face today, we decided to approach a few investors to learn about their views on this.
Talking to about 40 investors on how they evaluate a startup, we received mainly two types of responses from VCs. Value proposition and team — these are the two key areas that investors consider before selecting a startup.
However, many budding entrepreneurs are still clueless about these two clauses as they still consider profitability as the only factor that matters.
Entrepreneur India had a chat with a few venture capitalists to get a holistic view of how they evaluate and select a startup while betting high on it.
Repetitive Ideas in Market
Speaking about how a lot of startups adopt the “me too” approach while starting up in India, Arpit Agarwal, Partner, Blume Ventures, said, “We receive, on an average, about 400 startup pitches a month and most of them arrive with cold and irrelevant ideas. It is rather easy to filter out the request for funding a movie or a manufacturing plant.”
“For us the balance of founding team is very important. Having at least one strong tech co-founder is a big plus and having all founders with no relevant experience is a big negative,” he added.
Asked about what lacks in Indian startups? Agarwal said, “There’s nothing that is lacking in Indian entrepreneurs. They are the most ambitious and capable people, generally. He believes that what can be improved is the exposure to real massive scale problems. “Very often entrepreneurs are scratching their own itch and their inexperience in problems of real India (call it ‘Bharat’) comes to fore. With just an iota of inspiration, a lot can become better,” said Agarwal.