2 Evaluating Venture Opportunities Free Online FlashCards

What makes a value proposition compelling?

A value proposition explains how an offering relieves a customer pain or creates a benefit the customer cares about.

How should customer interviews test a value hypothesis?

Ask about a recent real experience, such as how the customer handled the problem the last time it occurred.

What customer evidence is stronger than hypothetical enthusiasm?

Repeated use of a workaround, a purchase, a trial commitment, or willingness to pay provides stronger evidence than hypothetical enthusiasm.

What does technical feasibility assess?

Technical feasibility asks whether the product or service can be built or provided to the required standard.

What does operational feasibility assess?

Operational feasibility assesses whether the necessary people, suppliers, facilities, distribution, and processes are available.

What does financial feasibility assess?

Financial feasibility asks whether expected revenue can support costs and whether the venture can obtain enough money to reach key milestones.

How are break-even units estimated?

Break-even units equal fixed costs divided by price per unit minus variable cost per unit: $\text{Break-even units} = \frac{\text{fixed costs}}{\text{price per unit} - \text{variable cost per unit}}$.

What should a venture assess when judging timing?

Check whether customers are ready, enabling technology and infrastructure are available, rules and purchasing practices permit adoption, and there is a realistic entry window.

What should support a judgment about market timing?

Use observable signals, such as customer behavior, industry trends, or changes in how the problem is addressed—not unsupported claims that an idea is ahead of its time.

What alternatives belong in a competitive assessment?

Compare direct competitors, indirect alternatives, and doing nothing on factors customers value, such as price, convenience, performance, trust, access, and switching effort.

Must a defensible advantage come from a unique invention?

No. An advantage might instead come from a more convenient channel, lower delivery cost, specialized expertise, better customer experience, or a trusted relationship.

How is a weighted opportunity score calculated?

Multiply each factor's rating by its weight, then add the products: $\text{Weighted score} = \sum_i (\text{rating}_i \times \text{weight}_i)$.