Startup Competitions – How Do They Help?

Recently, I had the chance to be one of the judges at a startup competition. After the event, I was thinking through whether these competitions are helpful to the participating startups and if so how. Overall, my conclusion is that these competitions are indeed helpful but the startups need to be strategic about picking the right competitions and not overdoing it by entering too many of these. Here’s my reasoning.

How startup competitions help

  • Free marketing – This is self explanatory. For a cash strapped startup, getting free publicity through the right competition could be hugely helpful. To pick an example from my Boston days, the MIT 100K competition has led to the creation of about 150 companies over the years including successful ones like Akamai Technologies. The startups in this competition get reasonable amount of recognition/free marketing through various media circles.
  • Exposure to investors and mentors – Through these competitions, a startup can also get exposure to investors and mentors in a lower risk setting. If an investor gets exposure to your startup through the competition and likes you he/she will most probably follow-up to take the conversation forward. Also, through these competitions a startup could meet experienced entrepreneurs who could mentor your startup to success. 
  • Firming up the business plan and pitch – The structure around these competitions forces you to think through your business plan and helps you shape it better. Also, your pitching skills (either the short elevator pitch or longer version) will definitely get exercised and refined through the various stages of these competitions. 
  • Answering tough questions – If the competition has the right set of judges, the startup will be asked some tough questions around their business plan. This would be a great way for the startup to prepare for answering such questions and thereby refining their business plan in a lower risk environment. 

Things to watch out for

  • Picking the right competitions – I think this is something that startups don’t necessarily think about. I would encourage the startups to think whether the competition serves the above mentioned benefits (and anything else specific to your company). In addition, is the competition in the right domain/industry for your startup (e.g. consumer startups vs enterprise vs medical technology, etc.)
  • Over exposure – This is one thing that I find a common issue. When I look at some of the competitions over the past year that I have judged or attended, I see some startups that have entered almost all the competitions (and some have not won any of them). So much so, that someone called a startup a “professional competitor”. This might be ok if you are winning these competitions. For example, I know a startup in the US that won every business plan competition they entered and ended up using that as seed money. But, if you entered a couple and didn’t win, its obviously not the end of the world. After all, I’m assuming your goal is to build a successful startup and not necessarily winning competitions. Please think about this. If anything, entering too many competitions might hurt your chances of getting funded by an investor (if raising outside capital is in your plans) since they would wonder why so many other investors who looked at the company through these competitions not invest.
  • Premature exposure – This is also something to watch out for. If your business plan is very premature and you will not be able to do a good job pitching/answering questions, you are better of refining your pitch before entering a competition. After all, the saying that “First impression is the best impression” is very true for startups as well. You want to put your best foot forward in these competitions and for that you need to be really well prepared.

Those are my quick thoughts on this very important topic for startups as they consider entering various competitions. Would love to hear your perspectives on this.

Note: Published by yourstory.in here

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6 thoughts on “Startup Competitions – How Do They Help?

  1. Hi Anand,Guess you have hit the nail on its head, picking and choosing is something we ignore.- Sadiq

  2. Anand, most of the reasons you have stated for participating in Startup events are very valid. Yet the problem that I’ve observed is the opaqueness with which they happen, leading to not so positive responsesThe issue that I’ve faced as a startup entering these contests, is communication. For companies that don’t qualify to the second round of these, which is significant proportion of applicants, there is no value add. Besides, there is no communication of failure, leave alone the reasons behind it. I would like to see1. All companies that are participating get something in return of the time they invested and the time the organizers invested in evaluation them2. Tweaking the communication a little so that a company that didn’t qualify to the next round doesn’t regret participating

  3. Thanks @sadigahameds@bala_tangylabs: Good points. I will share this with a few of the organizers I know personally. I hope other organizers also take note of this. For a typical competition, if there are 10 finalists and 100 applicants. If the process is 100 to 20 semi-finalist to 10 finalists, then I would think at least the semi-finalists should get actionable feedback. Asking the organizers to provide feedback to all 100 might be adding a little too much overhead and will probably end up compromising the quality of feedback. What do you think?

  4. I agree. But perhaps the bottom line reason of not proceeding in the contest could be nice. For instance in a contest that we entered recently, we were communicated that our company was out of scope of the contest. It was nice to receive that communication.But in two other cases, a mail that I sent to the organizers was responded with a blunt one line email stating, "Companies that qualified for the next round have been informed/ will be informed". More than the message, the way it was handled, left an after tasteWell, it is not an issue of very high significance, but it is something that is not likely to increase the enthusiasm for participating the next time.

  5. @bala_tangylabs: A brief message with reason for not being selected for the next round might not be too much to ask. Will pass this on for sure.

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