Many of you watch the show a TV called the "Sharks." It is an interesting reality show about real investors and real small business people looking to find money to build their businesses. One of the comments that comes from the Sharks quite often is whether the product is "scalable."
Why do they ask this question and why is it so important to the possible investment they would like to make?
Here is a definition of Scalable: Investopia says, "A characteristic of a system, model or function that describes its capability to cope and perform under an increased or expanding workload. A system that scales well will be able to maintain or even increase its level of performance or efficiency when tested by larger operational demands."
Put another way the Sharks are saying the business can be expanded to fill the apparent need in the market. Expanded at a rate that is manageable and quite possibly delivered with less cost as production and marketing efficiencies increase.
This wets their appetite for investment dollars because they see lots of profits in the future. Therefore, they try to make a deal with the small business entrepreneur that offers up the idea.
A good idea turns into a great idea when it can reproduced in volume!
show
Why do they ask this question and why is it so important to the possible investment they would like to make?
Here is a definition of Scalable: Investopia says, "A characteristic of a system, model or function that describes its capability to cope and perform under an increased or expanding workload. A system that scales well will be able to maintain or even increase its level of performance or efficiency when tested by larger operational demands."
Put another way the Sharks are saying the business can be expanded to fill the apparent need in the market. Expanded at a rate that is manageable and quite possibly delivered with less cost as production and marketing efficiencies increase.
This wets their appetite for investment dollars because they see lots of profits in the future. Therefore, they try to make a deal with the small business entrepreneur that offers up the idea.
A good idea turns into a great idea when it can reproduced in volume!
show
