Startup Helper. Multiple Entrepreneur. Addicted to Hyper Growth. Worked for companies like eBay and Criteo. Adventures include: 2 x IPOs, 1x Exit, 3 x Pivots, 1 x Turnaround and 2 x Failures. CEO. Mentor at Seedcamp. Startup Builder and Advisor.
You're at an exciting stage, well done for getting this far.
Having been in a similar experience we decided to go for a development team with a small company that specialized in helping startups bring products to market - they are called https://kanso.io/
The reason I went for a small development team was that they understood all facets of the business and the CEO lead the product spec phase with me which was incredibly useful.
When you're creating an MVP I found it very important to have not only a development team with expertise in development but also in product design, to create a great product from a user's perspective which aligned with what customers needed as well as how we needed the product to work business-wise.
This may not be the best solution for everyone but it worked well for us even post MVP for a year, until we raised sufficient funding to bring the technology in-house.
It is tricky but not possible.
Having been in your situation I can appreciate the challenge that lies ahead.
Investors took for signals to create reassurance and trust, things that are generally tangible like an MVP, initial customers, the first proofs that customers are willing to pay and a problem is actually being solved.
Not having that makes it a magnitude more difficult so having a proxy for those tangible signals will matter most.
For example to make the product more real without a product you may want to create a clickable demo to give investors a feel for the user experience and how it will work.
If you don't have customers yet then maybe you can survey the market and potential customers and reference those that provide good feedback and interest in your deck.
Other positive signals will be useful too.
Very importantly, at an early stage, investors are backing the team even more than the product. Having a solid team with sector experience who have created a startup before and have the experience needed will be very important.
In terms of investors focusing on friends, family and creating an offering that is derisked and maybe has task incentives can help get some initial commitments. Smaller tickets will help.
Also if you have invested your own money and have committed to not taking a salary or taking a greatly reduced salary for an initial period will show investors that you've got skin in the game and you're prepared to lose your own money.
Finally, investors like to see other investors invest, when there is momentum and fear of missing out investors may be more motivated to invest.
Give me a call if you want to discuss further how to create a solid MVP stage fundraising strategy
The answer is it depends.
It depends on what you need the software for and how it adds value and creates a moat against your competitors.
I'm not sure what sector you are thinking of, but if you are an online retailer then probably not as the software in that sector is fairly advanced and mature, and solutions generally customizable.
That is to say up to a certain stage, once you become Amazon... you're best to have your own proprietary software.
Also, there is no point in investing in reinventing the wheel for day-to-day "commoditized" software unless doing so can unify and improve processes somehow, creating unique know-how or way of doing things allowing you to get an advantage over your competitors.
On the other hand, if you are a digitally native company focusing on disruption then you will most certainly need to create your own software for three reasons, firstly the uniqueness and level of customization, secondly the pace of development required, and thirdly an important part of company valuation when it comes to fundraising is the underlying company technology and IP which forms a valuable asset.
In terms of software development, it is not uncommon for startups to use 3rd parties to develop the initial MVP and once proved - and with access to funding - to then take it in house. It would be unusual for a growth stage/series A company not to own its IP and develop their software in-house
It would be very difficult if not impossible to compete head-on with a similar product.
But if you have something unique and truly meaningful then that differentiation and fulfillment of a user's need will help you get that initial momentum.
LinkedIn, Microsoft, Google... weren't built in a day. One step at a time.
Thinking about the competition is useful but thinking about the customer is equally important.
Start small, validate your product and who your customer is, then focus on scaling up.
If your product is valuable then customers will be prepared to pay for it, this will also help with funding and strategic partnerships.
In one of my companies, I built up a user base of over 100k users fairly quickly, it's not that difficult if you have something unique, focus on the customer first while being aware of the rest of the market.
No an idea doesn't need to be unique to be valuable, it just needs to fulfill a meaningful need which isn't currently being catered for.
A great book with very useful examples to read is "Blue Ocean Strategy".
Innovation can fall into two camps. The first where companies innovate and improve within an existing category, or, the second where companies create a brand new category of product.
An example of the later would be a Facebook....
An example of where a company innovates and improves on an existing product could Nintendo when they launched the Nintendo Wii in 2006.
This new console focused on value innovation where they reduce the cost but also differentiated the product doing away with the DVD/cartridge element most consoles had at the time and introducing a wireless controller.
Another example is Yellow tail, the wine company who instead of focusing on prestigious traditional branding focused on mass market appeal making a sweeter wine to capture demand from beer and spirit drinkers, creating a very simple range making it simple to buy, a red and a white.
The last example is Cirque du Soleil who moved away from animal acts to reduce their cost based and focused on a more theatrical proposition inspired by the world of theatre with productions never see before.
The result for these companies? They created new market space in existing and sometimes very cut throat markets.
So you don't have to be a Facebook to be successful, you "just" need to offer customers something meaningful and differentiated.
A fun exercise for companies can be to look at how certain companies have looked outside of their verticals to innovate and come up with great ideas and winning strategies.
Clarity might be a good point to start if you search for "social impact mentor" https://clarity.fm/search/social%20impact
Otherwise, there are a number of platforms out there, the best approach would be to research on Google based on your specific needs and geographical location.
Facebook also runs a social impact mentoring platform https://socialimpact.facebook.com/mentorship/ for Facebook groups focusing on social impact so it could be worthwhile also searching on Facebook for relevant groups.
There are many forums and places where Amazon sellers congregate online, if you can find where these audiences congregate then this could be a way to approach them.
If you have found niches is there any reason you wouldn't want to develop an online presence yourself?
Platforms such as Amazon, eBay, Etsy and Shopify make it very easy to get going.
There are even software tools to allow you to manage platforms centrally.
The cost, knowledge required and the barrier to entry is low, and once you can see what is working via the platforms, then selling directly via Shopify or similar can help you get even higher margins
Knowing your target market is a core part of your business plan and go to market strategy.
Survey potential customers, find the pain points, offer them a solution which solves it and if they can't live without it you've got a winner.
There may be some information online but this is a pretty important part of the process to get right and will require a lot of manual research so that you don't end up creating a product there is not a need for and making sure there are (enough) customer out there willing to pay.
Having been in the same position I can empathize.
It's normal to be both excited and scared.
There are risks but also great rewards in creating a successful company.
Different people will have different ways of deciding when to go all in.
My approach (which may or may not be applicable) was to de-risk as much as possible, i.e. get as far as possible with the MVP before being all in.
Some important considerations were:
1. Having emotional/financial support from family/friends
2. Having completed all the go-to-market steps (even though the plan is never exactly how it turns out to be).
3. Getting comfortable with the financial implications e.g. investing my own money, not taking a salary in the first year, and the lost income.
4. Making sure it was the right time in my life to take such a risk.
Ultimately it could be a massive success or... not
If you fervently believe in your idea you will only find out if you try :)
You have some solid answers already from Assaf Ben-David and Paul McDonald. As they've mentioned it's purely a plan to guide and iterate from.
You haven't mentioned if you are launching a brand new product/service into market or looking to expand into new markets with your current offering, I've based my answer on the later.
If you are already in a core market and looking to expand into other markets, once you have defined your GTM plan then a good exercise is to evaluate whether your business is expansion ready.
If you don't currently have solid market fit in your core market, and a stable'ish and repeatable business then going into a new market can lead to a whole new world of pain and a high risk of failure
Here's an article I wrote a while back which you may find useful about whether Startup Internationalization is a risk worth taking https://www.scaling.partners/startup-internationalization-is-it-a-risk-worth-taking/