Several friends met on Thursday to listen to presentations from undergraduate business majors in the NCSU Jenkins School of Management, MIE 410: Business Opportunity Analysis class, aka “Pitching.”

Business Plans from Jenkins MIE 410

Business Plans from Jenkins MIE 410

It’s fun.

Today, on Quora, I found this question:  What is your advice for two 21 year old entrepreneurs?

This is easy.  My answer:

In short?  You need a 42 year-old advisor.

We heard 15 business pitches, delivered by graduates of NCSU’s undergraduate business program.  Some great ideas; some decent skill sets; some of them will succeed.

But not all.

Many of the challenges these businesses overlooked are simply common-sense knowledge that one accumulates over time.  We had feedback.  Take a bullet point.  Take two; they’re free:

  • You cannot quadruple revenue in a food service business without increasing the cost of goods sold.
  • Selling liquor changes everything.
  • The FDA WILL have an opinion if you play in their space.
  • You cannot run a warehouse in a residential neighborhood in the US.
  • Nobody has Wal-Mart as their first customer.
  • There WILL be fraud.  Your job is to figure out where, not to believe it cannot happen to you.
  • Employees and staffing are a bigger problem than you have allowed for.
  • 20% markup is not profit.
  • Someone is already doing that; this is not a bad thing but do not believe you are the first or only.
  • Someone else is already doing that in a different market; this is a good thing.  It proves the idea can fly.  Now, go see how they made it work.
  • Someone else sells this product; that is good.  Figure out who their customers are.  It’s possible to KNOW who buys that product; you don’t have to think about it.
  • LOTS of universities are working on this problem.  That you believe no-one has thought of your idea shows you didn’t do your homework.
  • 50 year old women can do make-up in 90 seconds, not 17 minutes.  Change your target market.

If you get an opportunity to sit in on a practice pitch fest, take it.  You may find out you know a bit more useful stuff than you thought.