Differences Between Inventors and Entrepreneurs

Inventors and Entrepreneurs both have new ideas, some of them quite unique. Yet, both have different perspectives on these ideas.

The “Shark Tank” TV show allows potential Entrepreneurs to pitch their ideas to the investors for possible funding. It is amazing to see many interesting ideas and inventions do not get funded because the person pitching the idea has not figured out how it could be commercially successful.

Therein lies the difference between Entrepreneurs and Inventors.

Entrepreneurs, the successful ones, know the importance of being able to build a business model around an idea and realizing the maximum value of that product/service. Generally they focus on that product/service before embarking on a new project.

Inventors, on the other hand, love to invent regardless of realizing value from their inventions. They keep on moving from one invention to another without thinking through the business aspects of their ideas. They are primarily driven by discovering new things and not money.

All Inventors cannot be successful Entrepreneurs. It is more important for such Inventors to turn over their inventions to business-oriented Entrepreneurs that can create a value for those ideas. Then the Inventors can continue their passion for inventing, hopefully funded by their previous successful inventions.

Ravi Patel

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Published in: on August 21, 2018 at 4:31 am  Leave a Comment  
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When Asking Investors ….

All Entrepreneurs, especially start-ups, are in need of money. What are the key things you need to do first when looking for money?

1.   Ask for a specific amount. Don’t state ranges or be vague. If you do not know the specific amount, it does not speak well of you understanding the financial needs of your business. It is okay to ask for slightly more than you need to provide for contingencies, but still look for a specific amount.

2.   Outline exactly how you are going to use the money. If you do not have a well-defined idea of how you plan to spend the money, it does not provide a high level of confidence to potential investors/lenders. However, resist going overboard and itemizing each and every item. You should have that for your own use, but do not need it when looking for money especially in the initial meeting.

3.   Present a realistic argument of how using this money will build a business that will generate positive cash flows. This will be the main selling point. Investors or lenders are not only interested in knowing how they will be repaid (with upside), but also whether the business can become a self-sustaining cash generator. Again, the idea is not present a thick business plan with fluff, but rather a well-defined and articulated strategy backed by realistic projections.

Spend some time in working on the above three requirements before you start looking for money.

Ravi Patel

www.patelCFOservices.com

Published in: on September 13, 2016 at 4:07 am  Leave a Comment  
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Keeping it Simple

Do you believe that you need more words to effectively communicate your message? Does using too few sentences reduce the importance of your point? Is being verbose mean you are saying something important? If you think so, you might be wrong!

Effective communication means driving home your point powerfully in as few words as possible with a simple message.

People have a very short attention span, especially potential investors. If you can’t communicate your message succinctly yet powerfully, you might lose your audience. That is not a good thing.

Regardless of the target audience for Entrepreneurs – investors, clients, employees, vendors, bankers or others – learn to fine tune your message. Make it short and simple, yet effective for them to understand and retain. The longer you speak or write, the less is absorbed.

People will not say that you didn’t speak long enough, but they will definitely give you feedback that your message was short but effective. Which is preferable?

Ravi Patel

http://www.patelCFOservices.com

Published in: on August 23, 2016 at 4:15 am  Leave a Comment  
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Before Raising Money …

All Entrepreneurs, especially start-ups, are in need of money. What are the key issues you need to address before approaching potential investors/lenders?

1.   Ask for a specific amount. Don’t speak of ranges or be vague. If you do not know the specific amount, it does not speak well of your understanding of the financial needs of your business. It is reasonable to ask for slightly more than you need to provide for contingencies, but still look for a specific amount.

2.   Outline exactly how you are going to utilize the funds. If you do not have a well-defined idea of how you plan to use the money, it does not provide a high level of confidence to potential investors/lenders. However, resist going overboard and itemizing each and every item. You should have that for your own use, but do not need it when looking for money especially in the initial meeting.

3.   Present a rational argument of how using this money will build a business that will generate positive cash flows. This will be the main selling point. Investors or lenders are not only interested in knowing how they will be repaid (with upside), but also whether the business can become a self-sustaining cash generator. Again, the idea is not present a thick business plan with fluff, but rather a well-defined and articulated strategy backed by realistic projections.

Spend some time in working on the above three requirements before you start looking for money.

Ravi Patel

www.patelCFOservices.com

Published in: on June 30, 2015 at 3:57 am  Leave a Comment  
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Looking for Money

All Entrepreneurs, especially start-ups, are in need of money. What are the key things you need to do first when looking for money?

1.   Ask for a specific amount. Don’t state ranges or be vague. If you do not know the specific amount, it does not speak well of you understanding the financial needs of your business. It is okay to ask for slightly more than you need to provide for contingencies, but still look for a specific amount.

2.   Outline exactly how you are going to use the money. If you do not have a well-defined idea of how you plan to spend the money, it does not provide a high level of confidence to potential investors/lenders. However, resist going overboard and itemizing each and every item. You should have that for your own use, but do not need it when looking for money especially in the initial meeting.

3.   Present a realistic argument of how using this money will build a business that will generate positive cash flows. This will be the main selling point. Investors or lenders are not only interested in knowing how they will be repaid (with upside), but also whether the business can become a self-sustaining cash generator. Again, the idea is not present a thick business plan with fluff, but rather a well-defined and articulated strategy backed by realistic projections.

Spend some time in working on the above three requirements before you start looking for money.

Ravi Patel

www.patelCFOservices.com