I am starting a green tech business but have little experience in the sector. Will investors care?
Wednesday, September 21, 2011/
I am starting a green tech business after about 20 years working in marketing and sales. I have little experience in the sector I’m starting up in. Will investors care?
You have identified a critical issue for investors – do they back the jockey or the horse?
In other words are investors looking to back you (the jockey) or the opportunity (green tech)?
In your case an investor would be backing you and your track record in sales and marketing.
You would need to demonstrate that your skills and success could be applied to a new sector – green tech.
You would also need to have a convincing operational plan that details how you could build your new business with speed and effectiveness.
This might be a hard picture to paint as all industry sectors are different and it might take you some time to navigate through the peculiarities of the green tech world.
So how do you bridge this gap between your past experience and your new business sector?
You need to find and recruit an industry professional as your point person in the key role that interfaces with your customers or suppliers. This might be a general manager, a CFO or a marketing manager.
This industry experience would “back-fill” any of the missing pieces in your understanding and connections in the green tech sector. Hopefully this key hire they would also bring customers and other staff to your business.
You should also round out the team’s expertise by developing an advisory board of green tech industry and general business experts who could mentor you and your team on a formal basis (if you can afford to pay them fees) or an informal basis (if you can afford to take them out to lunch).
Before you proceed much further – as in all new business ventures – make sure you research, then research and then research some more.
Which niche are you entering? Who are your customers and competitors?
What do the economics of the business look like? Are you exposed to increasing price competition?
Will you be subject to the whims of government policies?
Above all can you attract investors, staff and customers and commit your energies to a five-year effort?
If you can answer all these questions and convince others that you have something that is exciting – then go for it!