When I first started in venture capital five years ago, I wanted to create a programmatic way to analyze companies well. My goal was to be able to step into a meeting with an entrepreneur with some kind of form that I would fill out throughout the meeting, so that by the end of the meeting I might have an understanding how the startup fits into its ecosystem.
It took quite a while to devise this framework and to revise it until it became useful, practical and insightful. I spoke with friends who were consultants and who analyze companies for a living. I read many books on the topics of competition and strategy. Last, I spoke with other investors.
But in the end I chose three simple frameworks that were already well-known and which fit together on two sheets of paper: The Business Model Canvas, Porter’s Five Forces, and Value Chain Analysis....
Like management acronyms? How about BMC, P5F and GUF? In just 15 minutes, VC Thomasz Tunguz can analyze a startup business using three invaluable management analytical tools. Excellent read for you post-MBA types or those who enjoy thinking analytically.