Next Article: Slide 8: Competition
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Slide 7: Your Advantage
The investor now understands your team, the value proposition, the market, and your business model. Now she needs to understand how or what allows you to carry out plans effectively. That is, what advantages do you have that allow you execute your business model effectively. This section corresponds closely with the concept of competitive advantage. Is there anything that allows you to beat out competitors other competitors in the field or those who may enter the market after you.
What Is the Best Advantage?
The clearest form of competitive advantage is ownership of intellectual property rights. Angel investors will quickly ask what type of protections exists for a product or service design. A utility patent, protection on the process used or manufactured good, allows you to exclude others from imitating your process or duplicating your good. Note, this doesn’t stop alternative methods of producing the good or even innovations that improve upon your product, but it does provide a recognized form of protection against competition.
Other Types of Advantages
Other forms of competitive advantage (though often temporary) regard the existence of partnerships with key players in the market. If you have a distribution contract with Wal-Mart then you have an extremely strong advantage against competitors or new entrants. Another example of a competitive advantage is any unique skill or ability that your team or business possesses. If you have a computer engineer on your team who is at the forefront of your type of product’s design, then you could have an identifiable advantage. Don’t be afraid to include any aspect of your business that you believe will provide an advantage in carrying on business within the market.