Our Approach... to the Valley of Death

The valley of death is a concept used to describe how the huge cash negativity of an early stage technology often leads to a technology running out of cash and "dying" in the valley before it has reached break-even and then cash positivity.

The valley of death is a great metaphor as it clearly implies the risks of embarking on a long and difficult journey without the correct preparation. Would you set off into the outback without a four-wheel drive vehicle, mechanical expertise in case you break down, a clear map with a clear route, navigational tools and expertise, a good understanding of where the major obstacles and pitfalls are located, information on any potentially hostile locals, where water and food can be found if needed and finally a team of fit, knowledge and intrepid explorers?   No?   Well why do so many technology developers embark on a similar journey with only a cheery "this is a great technology!" on their lips and then wonder why the start-up business is being wound up after 18 months.

Starting a technology is a perilous undertaking and there are many unknowns, but one unknown that it is most valuable to understand is the Market Opportunity. If there is a clear “market pull” for a corresponding "technology push" then this is the biggest single factor for success. It means that if the "market pain" is strong enough customers are often queuing up with expression of interest very early on. This is what investors dream of.

This is why IplusP have developed a range of Market Qualification tools designed to make the valley of death shallower and narrower. We supply clients with a clear map, an understanding of the funding rounds, which customers will buy and when, for how much and at what frequency. Building this detailed picture of the market opportunity ensures a greater chance of the technology surviving the whole process and gaining an excellent return for their, and the investor’s, efforts.