For many years, we have had a lot of contact with the financial industry and investors who have been involved in so-called startups. ased on these observations and experiences, we have developed our concept Prio Startup. What has surprised us is the relatively poor dividend that investors get in their commitment – only one in ten investments gives a so-called Return On Investment (ROI). One would then think that a poor evaluation and decision-making basis for their engagement were made, but it turns out that only a small number of all the companies you invested in had a poor business idea from the beginning. Thus, the poor outcome must be due to the fact that one simply does not take care of its investment in an efficient and good way. From this observation we have developed our concept Prio Startup.
A new company is always in a learning process where you make mistakes and correct them. This is a natural process in all companies. What causes problems for a new company is that, like a small child, it is much more vulnerable to when something fails. Things that for a mature and established company are only a minor problem, can be fatal for a newly started company. Therefore, it is very important that the so-called risk reduction can take care of all problems, big and small, that the startup company would encounter. It is not worth it to pass 49 out of 50 obstacles if you stumble upon the 50th – you do not reach your goals anyway. We have been amazed at why investors have accepted such a poor dividend, and our analysis is that after all, a reasonable return has been obtained since the profit on the 10th investment covers the losses on the other 9. However, we think it is extremely bad that it is 9 business ideas that do not succeed and enter the market and become successful companies that provide many new jobs.