There is a widespread myth that the most important part of building a great company is coming up with a great idea.
This myth is reflected in popular movies and books: someone invents the Post-it note or cocktail umbrellas and becomes an overnight millionaire.
It is also perpetuated by experienced business people who, for the most part, don’t believe it. Venture capitalists often talk about “the best way to pitch your idea” and “honing your elevator pitch.”
Most business schools have business plan contests which are essentially beauty pageants for startup ideas. All of this reinforces the myth that the idea is primary.
The reality is ideas don’t matter that much. First of all, in almost all startups, the idea changes – often dramatically – over time. Secondly, ideas are relatively abundant. For every decent idea there are very likely other people who’ve also thought of it, and, surprisingly often, are also actively pitching investors. At an early stage, ideas matter less for their own sake and more insofar as they reflect the creativity and thoughtfulness of the team.
What you should really be focused on when pitching your early stage startup is pitching yourself and your team. When you do this, remember that a startup is primarily about building something. Hence the most important aspect of your backgrounds is not the names of the schools you attended or companies you worked at – it’s what you’ve built. This could mean coding a video game, creating a non-profit organisation, designing a website, writing a book, bootstrapping a company – whatever. The story you should tell is the story of someone who has been building stuff her whole life and now just needs some capital to take it to the next level.
Of course a great way to show you can build stuff is to build a prototype of the product you are raising money for. This is why so many VCs tell entrepreneurs to “come back when you have a demo.” They aren’t wondering whether your product can be built – they are wondering whether you can build it.
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