Credit Debt Banking News | CDBN

This is part 1 of the series: 5 Lessons from 150 startup pitches.

Listening to first-time entrepreneurs talk about their competitive advantages is as predictably invalid as the local weatherman’s 10-day forecast.

Between this blog and reviewing applications to Capital Factory I see hundreds of pitches a year. Every pitch has a section on competitive advantages, and quite literally 95% of the time the claimed competitive advantages are pathetic, unoriginal, and not really advantages at all.

The first clue that your competitive advantages aren’t actual advantages is that everyone else on Earth claims those advantages too!

P.S. Next week I’ll talk about what are real competitive ..read more

This is a guest post by Steve Hanov, who blogs about programming and startups.

For a micro-ISV, selling to big businesses can be more lucrative than selling to consumers. Instead of making a few dollars per sale and hoping for thousands of sales, you sell to only a few customers, and charge much higher rates. But the rates are high for a reason. It takes more time and money to sell to businesses, especially the big ones.

Legal Issues

Consumers rarely read software license agreements. Most corporate customers don’t read them either, but some have legal departments that must approve any agreement that the company makes, no matter how small. ..read more

A sizable percentage of Capital Factory startup submissions take the form of the “marketplace.” In fact, 3 of the 10 selected companies from the past two years have followed this business model.

Marketplace companies are notoriously difficult to start, so I’m constantly amazed that so many entrepreneurs chose this route. Maybe it’s the “go big or go home” mentality? If there’s a business plan less likely to succeed than a restaurant, this has to be it.

But it’s not impossible; here’s some of the pitfalls and how to address them.

A marketplace is born

A “Marketplace” connects buyers and sellers who otherwise have trouble finding each other.

..read more

I remember “disruptive” when it was called “paradigm shift.” That phrase died during the tech-bubble along with “portal” and “think outside the box,” yet the concept has returned. Don’t follow along.

When I get pitched — usually by someone raising money — that they “have something disruptive,” a little part of me dies. You should be worrying about making something useful, not how disruptive you can be.

“Disruptive” is the in-vogue word for the opposite of “incremental improvement.” A disruptive product causes such a large market shift that entire companies collapse (the ones who don’t “get it”) and new markets appear.

Disruptive is fascinating, disruptive changes the world, disruptive makes us ..read more

They say “statistics lie,” but they don’t. People do.

Well, that’s a little harsh. Sure some people intentionally skew numbers and selectively pull data, but most folks misinterpret data by accident.

Why do you care if you’re not a scientist?  Because you collect data about your business all the time — web traffic, revenue sources, expenses, customer behavior — and make decisions based on your (mis)understanding of that data.

Here’s a few basic mistakes I encounter constantly.

Statistics don’t tell the whole story

It’s easy to boil a data set down to a single number, like an average. Easy — and often shortsighted.

Single numbers feel powerful; you feel able to wrap your mind around a lot of data. Sometimes that is indeed useful, ..read more