Lakeside 10-Point-Startup-Assessment

Say you have met a startup and are considering an investment. The idea sounds great, the team is highly energetic and you cannot help being excited about prospects of this aspiring new venture. But is this startup really as good as it sounds or are there hidden obstacles and risks you are not aware of? How do you know that you have considered all relevant aspects before making an investment decision? And most importantly: how do you protect yourself against your own excitement?



We have found that the best investments are made when the heart and the head are in alignment. We employ a structured 10-point startup assessment methodology for a head-to-toe evaluation: a great idea, a strong team to pull it off and the necessary capabilities to offer unique and lasting value to the custom-er. It is all common sense, common sense that has been sharpened through hundreds of startup evalua-tions and a structure that has been tested, used and refined time and time again. A structure that allows you to professionalize your startup assessment, provides you with a set of criteria and questions to ask to look under the hood of a startup and gather the relevant information for a well-informed investment de-cision.



Below you can find the necessary details on our 10-Point-Assessment to get you started as well as the required resources to carry out the assessment yourself.



Lakeside Invest & Consult

Hauke Hansen

Hauke Hansen

Managing Director Lakeside

Details

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Core dimensions of the 10-Point assessment

We evaluate investment opportunities along 10 dimensions, where it is clear that nobody is perfect and there is no single path to happiness. Rather our intent is to understand you and the true potential of your business: 





  1. Idea: How convincing is your business idea, product and/or service offered? Does is address a real customer need?



  1. Market, Customers, Competition: How well is your venture positioned in the market, towards customers and versus competition?



  1. USP: Does your venture offer a substantial, differentiated & defendable value proposition?



  1. Team: How strong is the founding and leadership team?



  1. Ops Model: How effective are the operating model, processes & technology? How fast is the learning curve?



  1. Growth plan: How clear, ambitious & realistic is your growth plan? What are core milestones? How big is the scaling opportunity?



  1. Legal setup: Is the legal setup sound & appropriate? How big are the legal or regulatory risks? Any sleeping dogs?



  1. Financials: How attractive and realistic is the financial structure and outlook? Are the unit economics healthy and scalable?



  1. Risks & opportunities: What are core business risks & opportunities?



  1. Investment terms: Are the investments terms clear and fair?





Assessment results

Startups results are organized along 3 dimensions:





  • Score: The score indicates the economic success potential of the evaluated venture (vertical axis).



  • Risk: Risk indicates the likeliness of a venture not to reach its targets (horizontal axis).



  • Completeness: Info completeness indicates how complete the required information is (bubble size) vs. the total information we would have liked to receive as an investor.





The result is a bubble chart like shown on the right where the score is shown on the y-axis, the risk along the x-axis and the size of the bubble indicates the remaining uncertainty.



Detailed Startup Checklist

Over time Lakeside has developed a set of questions along the 10 points of the assessment to help with understanding a startup to the necessary degree to make a well-informed investment decision.



Those questions should cover qualitativ aspects such as the mission and team composition of the venture but also provide a structured way to analyze the startup's financials and provide experience based investment criteria.



We provide the full checklist as a word document for download in the files attached below and hope these questions will be helpful to you as investor (or startup) to come to a fact based assessment to support an investment decision.



For detailed questions please contact: Hauke Hansen (hauke.hansen@lakesideinvest.com)



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