They identify the most common blind spot for founders as a failure to realistically evaluate the market value of future products and acknowledge competitors.

Fundamental questions that should be asked in evaluating a venture are whether or not a sufficiently large market exists and if it can be profitably served. Unsubstantiated estimates such as ‘we expect to serve x percent of the $y billion market’ indicate a fundamental lack of understanding of business development needs. It is not sufficient to simply assume acquisition of a proportion of an existing market; a bottom-up analysis is essential to account for the key actions and costs involved in acquiring market-share and serving a market.

Many entrepreneurs also fail to account for all existing and potential competitors or their responses to new market entry. Some competitors may already serve the target market, but potential customers may also be using alternative solutions; horse-drawn wagons were competitors to the first cars. Potential competitors, represented by future technologies, must also be considered. Even with a complete inventory of competitors, a common mistake is to assume that competitors will act rationally.