In management literature, gap is referred to the difference between the actual performance vis-a-vis potential or desired performance. From the investors' perspective, "gaps" refers to potential deadly or susceptible weak areas, which could threaten the very existence of such startups, and thus aren't right or ready for investment (funding)!
Every Startup has Gaps!
Let's look at the dismal statistics w.r.t Startups:
92% of Startups in India failed to get any funding in 2019 - Business Standard
90% of Indian Startups (like worldover) also fail within 5 years - An IBM & Oxford Study
If you study the top 20 reasons of why startups fail (by CB Insights), every single reason hints to a prevailing gap, in each of these failed startups.
Podcast: Valuable Insights by an Entrepreneur, Who Failed the First Time!
What can those Gaps look like?
Some of the prominent gaps, which make the startups non-investable are:
Run of the mill or copy cat of an existing startup
Founders lack vision, passion or perseverance
Inapt team with insufficient domain expertise and missing complementary skills
No traction (Don't pitch to the Investors, if you don't have traction)
Lack of a concrete or scalable business model
Missing unique value proposition and/or unfair advantage
Little or limited market potential
No concrete Go-to Market or Growth strategy
No clarity on future roadmap and milestones
Inherent risks (regulatory, industry, no intellectual property, liability, etc)
Investors assesses for all such gaps, to say "No".
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Further Read: How a key gap in a startup, spooked it's founders?
So, when was the last time, you reviewed your startup, to see if there are any prevailing gaps?
Resources:
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