by • September 4, 2011 • UncategorizedComments (1)100

Run the best case numbers before validating

Yesterday I heard a pitch which sounded quite good. It was well articulated, the use case was clear, the customers were ready.

But there were only 60 possible customers in the country and a sale price of 20k. If we [generously] assume you can get a support contract for the full purchase price per year, then you’re looking at a maximum yearly revenue of 1.2mm if you close every single customer.

I’m a big believer that all financial projections are bullshit. But if your best-case scenario isn’t jaw-droppingly wonderful, you shouldn’t assume startup risk and spend the time trying to validate it and/or make it work.

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One Response to Run the best case numbers before validating

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