Bootleg brothers brewery
  • Home
  • ENT 650
  • ENT 645
  • ENT 640
  • Contact
  • Home
  • ENT 650
  • ENT 645
  • ENT 640
  • Contact
Search by typing & pressing enter

YOUR CART

5/25/2017 4 Comments

Develop your dream team

Picture
Another key fundamental to early-stage investing is evaluating. Investors look at many components when evaluating a business to figure out whether it is a sound investment. Authors David Amis and Howard Stevenson have introduced The Harvard Framework in their book "Winning Angels" which list four elements to consider when looking at investment opportunities. These elements are people, business opportunity, context, and deal. Each of the four elements are crucial not only by themselves but also how they interact with one another. I will focus on one element in particular which is a key part of the startup and for investors.

With any business there are normally three types of people; the entrepreneur, the team, and the stakeholders involved. As a start-up, the entrepreneur is at the bow of the ship. He/she is the one who has taken the idea and turned it into a company. However, there is no "I" in company, or team for that matter.  As I am developing the business plan for bootleg brothers brewery I quickly came to the realization that I cannot do it alone. I need to find people who fit the culture, share in the passion for the products and services, and compliment the strengths and weaknesses of the other members. As Wade Myers said in "Winning Angels", "Capability, desire, availability."

For example, my brother and I have been working on starting a brewery for awhile now. He is currently a Head Brewer in Colorado and I have had experience in management and continuing my education. Yet, I recognize that we needed to assemble other members who could fill in the gaps where we lacked and compliment the team as a whole. Since then we have added two people who share in our passion and concept and add value to the business.  One model I used when evaluating our management team was a SWOT analysis. It was very helpful to see what strengths and weaknesses our team possessed and the opportunities and threats that may present themselves.

When looking for members to join your team there are a few suggestions given from the article, "5 Steps for Building a Great Startup Team". In the article it mentioned identifying candidates that were fans of the product, were able to start with a limited salary, or were in your network.

I also found an article where angel investors were interviewed on what they look for when investing in startups. Below are answers from two investors who were interviewed.

When asked what qualities she looks for in a founder before deciding whether or not to invest, Lauren Kolodny, Principal, Aspect Venture, said "there needs to be a good alignment between the founding team and the solution they are building or pain point they're addressing."

Om Malik, Partner at True Ventures & Founder of Gigaom, was asked what key elements he looks at when investing in a startup. He said, "People first and foremost. Ideas come next, and the potential market comes third. I think seed investors who are in for the long haul need to love the entrepreneur [enough to] have a fair and honest and constant communication while building the company."

As you can see, people play a major role when investors are evaluating a business. If you are an entrepreneur or in the early stages of your startup I hope the examples above will offer some insight.

https://medium.com/product-hunt/what-do-investors-look-for-when-evaluating-a-startup-3023a65c4160
https://www.inc.com/john-rampton/5-steps-for-building-a-great-startup-team.html
Amis, David, and Howard Stevenson. Winning Angels: The Seven Fundamentals of Early-Stage Investing. London: Pearson Education Limited, 2001. Print.
4 Comments
Mary Schuler link
5/25/2017 07:31:12 pm

Hello John,
Your blog is looking good.
I like the idea that the team is what will bring value to the company and be of great interest to the Angel Investors.
I see where your brother would compliment your team greatly. You say he is Head Brewer in Colorado. Is he working for a Micro Brewery or a brand name company now? Will his advice carry you through much of the set up process or do you hope to do this as a family business.
I always look forward to your blogs.
Keep up the good work!
Mary

Reply
Mackensie link
5/29/2017 01:13:18 pm

John,

Great article! It is very interesting how in the article you referenced they said that people come first and then the idea in deciding what to invest in. I would have thought it would be the other way around. I did not realize that evaluating the entrepreneur matter even more than the actual product or idea. This gives me a new perspective in angel investors and what they look for.

Thanks,
Mackensie

Reply
Brad Tanner link
5/29/2017 08:28:29 pm

My addition would be that the team member has to understand that you are the captain. And that it is a team that works together not something that they manipulate and control. The only time I have gotten in trouble was when I recruited someone to be on the team and they assumed that it was now "their" team. That led to power plays and miscommunication with other members of the team. You need teammates but they need to know that it's your team

-- Brad

Reply
Michelle Moore link
6/26/2017 11:41:36 am

Finding the right fit is a critical pillar to any relationship. I have found that when you work with people that are as passionate as you are then they will be loyal as well. Loyalty stretches farther that the lean times and loyalty reaches deeper than 9-5. One team, one goal equals one rhythm and one heartbeat. People play a major role at every benchmark of our success.

Reply



Leave a Reply.