UK Venture Capital - Technical Vetting
Introduction
A new generation of investors have arrived, well versed in
the black arts of the Internet and high technology. Buzz-words
and lingo will no longer cut any ice if an examination of
your plan reveals a defficiency in your technical research.
This is especially relevant when your plan has not yet been
turned into a draft. More and more investors and funders are
realising that projects stand or fall on the depth of their
technical research. Small differences even in scripting language
can make or break an idea. Your level of knowledge on these
subjects will heavily influence your costings for developement
and importantly your expected market penetration as Boo found
out to its cost when its launch was plagued with technical
hitches which ruined its impact and spoilt all chances of
success.
Why?
Let's illustrate this with a typical project, the old "portal"
number as an example, rough around the edges, underfunded
yet with enourmous potential. You have given birth to the
scheme and now need to reassure the investors that his risk
has been minimised. This is more important than any grand
ideas or the end game. This game is 1% inspiration 99% making
your investor relaxed enough to get involved. You outline
the plan, and through all your polished presentation of your
aims, figures and concepts he or she is wondering whether
there is enough "geek" in you to do business out
in cyberspace.
Technical research is extremely time consuming and can double
the costing you have submitted and thats if your lucky enough
to make the right choices throughout. Many of the best ideas
come from those with no technical background (as do funders!)
but this is scant comfort for the hardened investment professional.
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How exactly will you track sales on affiliate sites?
Does that system really work compared to...?
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What's your hardware and software suppliers technical
support like compared to others?
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Is your plan complex enough for today's demands? Where
once a list would do, now a live relational database with
intelligent agents is a minimum for most sites.
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Will a sophisticated audience really be impressed by
your site or has it already been done before?
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Has the database to generate pages you were sold been
properly compared to the hundreds of other options on
the market. Is it fast or effecient enough long term?
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Will he or she be paying thousands to sort out errors
in your scripting before the lauch only to learn that
the language you have chosen won't allow some of the functionality
you hoped?
How?
Here's the hard part as you've probably realised. Finding
someone to give you professional advice impartially is near
impossible. It simply isn't enough to ask " a friend
who knows computers", or your local lad in his bedroom
with the specs and thermos. Much like choosing a lawyer you
need to know that if hauled in front of the House of Lords
they and their work won't crack under pressure. High street
solicitors rarely win when up against the Capital's top firms
and with so much money and heartache at stake its essential
to know you are well prepared.
For those on a real shoestring we have seen people who have
undergone this process themselves. After all who better to
know the ins and outs of a plan that the author. This will
usually take around 6-8 months, and should't cost much more
than £15K-£20K in hardware and software tests,
phone calls and books/training courses. Many entrepreneurs,
possibly due to their nature find this attractive and it is
an invaluable skill set for later life. The major drawback
here is that by the time you've finished you can bet (we'll
give you outstanding odds) that someone else will have rolled
their plan out before you and the avenue is closed.
What does it involve?
Essentially a deep analysis of all the elements upon which
you will be relying, from your site to your in-house systems.
In many cases the wise investor will reverse engineer and
hack your sites and systems to look for holes...
For example an average vetting will analyise site efficiency,
navigation, O/S's, Server hardware, data transfer, all scripting
languages, database platforms, workflow and groupware software,
contact management, stock and inventory databases, web languages
and server platforms, desktop clients, mass mailing post office
systems among a variety of other considerations specific to
your plan. Don't believe for one minute that words are sufficient
to quell an investors anxiety in this vital area. More and
more funds and individuals rely on firms with veteran programming
and technical teams to vet ideas in detail, especially when
this involves software. Your team will also be "interrogated",
as one recent member of a float complained. Make sure they're
up to it.
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