My Entrepreneurial Scorecard

davey.crainLists of entrepreneurial qualities abound on the web.  After a couple years of working with entrepreneurs and start-ups, I’ve come to the conclusion that while entrepreneurs in aggregate do exhibit many similar personal qualities, the success of their start-up is a different issue altogether and tied to a much more  extensive set of factors.

So my personal “scorecard” for initial evaluation of entrepreneurs includes both personal factors and opportunity factors.  I typically look at four factors in each category.  What follows is a quick overview of my thought process in an initial meeting with an entrepreneur.

Personal factors

There’s an old cliche in the investment community that they would rather invest in “an A team with a B product, then a B team with an A product.”  This speaks to the importance of the people involved in any start-up, and I tend to judge the entrepreneur before I judge the idea.  Following are the four factors that weigh heavily in my evaluation of the personal side of the entrepreneurship equation.

  • Passion and Commitment

  • “Inner Circle” support

  • Realism

  • Ownership

Finally, on my scorecard, it’s highly important that the entrepreneur takes  ownership for their own success.  Any entrepreneur who demonstrates in any way a mindset that their success is dependent on the actions of other people presents a huge red flag and is a topic I will immediately address.

Opportunity factors

Even an A team needs something to sell, and when I say “opportunity” I mean the product, service or concept the entrepreneur has at the core of the start-up.  The questions below speak primarily to the bulk of my current clients: high-growth potential start-ups in the technology space.

  • Something that’s real

  • Market need, and a way to get there

  • A team that can deliver

  • Profitability

Your thoughts?

So that’s my scorecard, what do you think?  It’s not intended to be anything other than an initial vetting tool as obviously deeper information is needed to truly judge the potential of any start-up.  However, as a tool to evaluate early stage entrepreneurs and their businesses it has served me well and I can tell you that many of these areas are also important to my peers.

Entrepreneurs – how do you fare against this scorecard?

[Editor’s Note: You can read a more in-depth article on this topic on Dave’s personal blog.]

davey.crain is Director of Entrepreneurial Services for MAGNET’s High Technology Business Incubator.

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Posted by MAGNET Ohio in Entrepreneurship

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