Onset Ventures Business Evaluation

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Onset Ventures Business Evaluation

ONSET was founded in 1984 on a well- thought analysis of the VC

industry. It was intrigued with the process of starting and growing

new businesses. ONSET distinguished itself from its competitors by its

investment focus. ONSET focused on initial and follow-on investments

in seed stage projects because returns are more profitable at this

stage. The main risks ONSET faced were technical and marketing risks.

ONSET had its own adopted model for assessing opportunities in venture

capital market, this model included:-

* ONSET won't lead a start-up in an industry where they don't have

the ability to reinvent a business model. Accordingly ONSET won't

try to invest in a niche that is entirely new to it.

We agree with this point, as the risk will be minimised if ONSET has

the expertise in that field of business before.

* ONSET will only invest in deals where it has a local presence. As

the more distant they are from the management team, the harder the

value ONSET can add to the business.

We disagree with that trend, because many firms have its own qualified

management team and their leaders and board have the necessary traits

to lead the firm. So ONSET will lose this category of business if it

insisted on that principle.

* If the investment exceeds $30 million of private capital in a

single company, then ONSET doesn't consider it as an investment

for it. This will need extra effort for ONSET to make it worth the

investment.

We agree with that as ONSET funds seed capital to many start-up

companies so there must be a certain limit to the investment cost. Th...

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...ide and product

design while the other doing the market research was an excellent step

to minimize efforts and save time. Also, this led to augmentation of

the product design with information obtained by the market team. By

attracting two paying development partners, TallyUp and Onset

outperformed their efforts in a step enabling them to try their

product and fine tune it.

However, their decision to hire a CEO was a little early since their

business model had not yet settled. Moreover, their product was not

yet introduced in the market and not yet fully developed.

Finally, Onset should consider financing part of the beta stage before

releasing the product in the market. It should also accept part of the

funding from VC firms since the VC market was hot. So, Onset should

take advantage of this current situation.

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