Coming up with an idea may seem easier if you haven’t come around formalizing it into a business proposition. Out of the many innovative concepts that our youngsters come up with every now and then, most of them don’t even make it to the finalization stage especially when they are on their own. Hence, the most viable option would be to seek guidance by pitching your idea to an organization which have an experienced team of successful entrepreneurs on-board with them.
But why do many of these startups fail to make the final cut? As an upcoming entrepreneur, you would be aiming to put all kind of efforts to get shortlisted by one of the leading seed funds like 10xC. Every year we go through numerous applications by Pakistani startups and so we have a very clear sense of which startups make the cut and which don’t. Since applications are currently open for our next round of investment, we’d like to go through some of the possible reasons that could see your application being rejected by 10xC:
1. Lack of IP Protection
We strongly encourage startups to come up with new ideas that would be implementable in our local surroundings in the coming future. Hence, first and foremost we make sure that the applicant’s idea is their own and that it hasn’t been copied from another source in which case they would fail to make the final round of selection.
2. Limited Scaling Potential
While assessing hundreds of applications we receive, one of our major areas of focus is the scaling potential of the proposed idea. Some ideas are quite innovative but don’t offer much opportunities when it comes to transforming into a full-fledged business. Hence, it’s quite necessary for the startup founders to make us understand what mechanism they would be following in order to accomplish their set of goals.
3. Absence of Revenue Model
Most of the applicants get rejected because they lack a proper business model which would also include a defined system for revenue generation. Being a seed fund that would invest at least PKR 1 million in their respective businesses, the founders need to show us that they would be putting all that money to maximum use and have also decided upon future plans for revenue generation.
4. Probability of Risk Factor
Since 10xC is a seed fund where many investors provide the initial investment to its funded startups, we need to be very mindful of the risk factor involved. Your application should provide all the right answers as to how you aim to minimize the risk factor and how you will be safeguarding your business interests against all those possibilities.
5. CTO’s Mandatory Requirements
Probably the most fundamental aspect of your 10xC application is the CTO’s role within your startup company. Our guidelines clearly state that the CTO should have equity within the company and is expected to fully dedicate himself to the business proposition. He shouldn’t be a part of another organization with his motivation being to make money from both ends.
Applications are now open for our next round of investments which begins in August 2017. Apply here.