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Thursday, January 5, 2012

It Is Not a Fit

What did that investor mean “it is not a fit?”  Why did he not see how wonderful our company is?  Just a few questions you might have after hearing the famous words.  They come from investors, potential partners, friends, family, and YOU.

Think about what this means in simple terms.  (By the way, all of these examples are real life ones)

1.      You give pajamas to a family member. You went to the trouble to buy the largest size made to make sure they fit.  The family member comes back and says they are too small and I do not like flannel.  OK the size and material were all wrong.  “Not a fit!”

2.      You have a jar of M&Ms with all colors.  Your friend eats all of the M&Ms but leaves the blue ones; what is up with that?  The friend says he does not like blue!  “Not a fit!”

3.      You are investing in stocks.  You want a diverse investment of 5 stocks one in each of 5 sectors.  You have one from the following groups so far: financial, discretionary, utility, & energy.  Someone shows you a second financial stock.  You need a technology stock to round out the portfolio.   The second financial is, “Not a fit!”

4.      You approach a VC.  The VC will invest in 6 companies this year.  They already have two companies they hold investments with technology related to yours from previous year’s investments. They determined which technologies they have interest in for this year last December.   You may have great technology, but your company is, “Not a fit!”

5.      You are talking to big pharma about partnering your drug.  They have 5 related drugs in their pipeline which you are not aware of.  Your drug is “Not a fit!”

6.      Your technology, business concept, and/or management are not something that is attractive to an investor.  No particular reason, they just do not get excited about it. You got it, “Not a fit!”

I could go on about this concept, but hope you are getting where the discussion is leading.  Every part of life has the potential to not be a fit with the here and now of what is taking place.  This includes things like eating M&Ms all the way finding the right business relationship with a partner. 

Your job is to evaluate as much as possible the landscape and help show the fit to the investor, partner or other entity.  This is all part of your planning which must take place before engaging in discussions or negotiations.  It is hard to sell a product to someone that already has 5 of them and is not happy with the product at all.  You are better off selling something they need.  You may have to show them they need it, but that is easier if they do not have it already.

Summary:  Selling and marketing is more than what you do at the retail level.  In startups, it is what you do to find funds and to get business partnerships. It is possible to make a square peg fit in a round hole if you try hard enough.  I took back the PJs and got a different brand, and I am the one that finishes the blue M&Ms that are left (I cannot tell the difference anyway).

Taffy Williams is the author of:  Think Agile:  How Smart Entrepreneurs Adapt in Order to Succeed to via Amazon