What is common between Square, Hailo, Codecademy, Pinterest, Tumblr?
Square’s allows entrepreneurs to accept credit card payments via smartphone. Hailo is a yellow taxi cab app. Codecademy is an online coding tool. Pinterest provides people with a quick, easy, entertaining way to share photos. Tumblr is one of the most popular Web destinations in the United States, and it also gives people a digital platform where they can express themselves.
All these web-based companies have one thing in common: They all have got funding from Richard Branson.
Choosing among these non-Virgin companies had never an easy task for him, as funding a startup “requires thought and care, because no matter how qualified the founders are or how much they have thought through their business plan, most will not succeed”. But, over the years, he has learned to look for the same things in startups that he does in ideas for Virgin companies.
“If I understand a startup’s product or service on first glance, then customers will too — and if it solves a problem that needs fixing, there’s a good chance that some will buy it”, says Mr Branson while sharing his experience of funding startups.
Here are the five questions, Mr Branson believes an entrepreneur seeking investors for their tech startup, must be able to answer “yes!” :
- Does your company offer a smart, simple solution that improves customers’ lives?
- Is your company’s use of technology disruptive?
- Does your company offer customers greater choice and better access?
- Does your company’s product or service encourage customers to share their work or experiences?
- Does your company care enough about people and the planet to use business as a force for good?
He chose to invest in Hailo because it lets passengers hail free taxis on nearby blocks with their smartphones. It is a great example of a disruptive technology, since “it’s so more efficient and responsive than the current options”.
However small a company, “its founders should try to expand people’s opportunities and choices”. He found codeacademy one such company. He decided to invest in Codecademy because “many people need and will benefit from access to basic programming skills for free.
Pinterest is all about inspiration and discovery, providing people with a quick, easy, entertaining way to share photos. It has rapidly become a household name — and inspired him to invest in the company.
Adapted From: Richard Branson on Convincing Investors to Fund Your Tech Startup
