Beware the million-dollar cheque!
Associate Peter Hanschke is an Ottawa-based product management specialist. His post is part of our continuing series about the ecosystem necessary to bring technology to market. We welcome your comments.
By Peter Hanschke
Startups begin with little to no money. Much of the early development of their product is funded by the owner, by his or her friends and maybe even by an angel. Every dollar is used wisely and focused at the topmost activity. To build the product from concept through to MVP (Minimum Viable Product) and to the point where a small number of customers can use the product, the company has one, maybe two, full- or part-time developers. In some cases the owner pitches in occasionally to help in development or testing.
Young and lean
In such an environment, drive, enthusiasm and the will to succeed fuels the development process. The product takes shape as the development iterations roll by. Occasionally more money is needed to fuel the development engine, which the owner must somehow secure. Without real customers validating the solution, it’s difficult to get significant funding to speed up the development process or build a more enriched product.
Despite the tough times at this stage of the startup, this is in fact a very desirable situation.
