Writing a Business Plan for Success in Business and for Funding
Writing a business plan to help you direct and manage your company is a key part of starting you new company that will help lead you and your company to success. Creating a "living and breathing" business plan makes that success even easier to reach. Many people feel that the sole purpose of a business plan is to get funding, and write a plan that is targeted to that audience. This plan should be considered a piece of you Fund quest documentation, but should not necessarily be edited to meet each funding source.
What is a living and breathing business plan? It is a short document that outlines your company, its product or products, and the development stages of that/those product(s), competition, market or industry, marketing strategies, sales strategies, including key clients you want to target, and your financial needs and goals. As your products advance in development, as the marketing strategies shift and change due to success or failures in marketing, as you acquire those clients you were targeting or you change your target clients, as you acquire funding or revenue streams, your plan gets updated to reflect the next steps.
Many people dread the "writing of the plan" process. It doesn't have to be that hard. You already have an idea that you have pretty firmly in your mind, or you wouldn't be creating a company.
Write a short paragraph that summarizes that idea. From there, write a paragraph or two on each product that you plan on building. Just describe the product, not how to create it. Next look at the market, write a couple (two or three) paragraphs on the market, including the market value, and the ups and downs in the market. Next you need to show yourself the value proposition in your company over the market and who the competition is. Now you are going to want to know how you are going to sell your product(s) and what that cost is going to be and how much you are going to sell it for, in two to three paragraphs. You should by now have an idea of how you are going to market your product, and write those ideas out in a couple of paragraphs, not too much detail yet. At this point you have a good idea of what your staffing needs are going to be in the near term, three to five years at the high end, next year or two at the near end, so write it out in a paragraph or two. To run a valid company, you need three people, a Business Manager, a Financial Manager, and a Product Manager. (These can be one person, two people, or three people, and I recommend that it be at least two people, Business/Product Manager in one, and a Financial Manager. You want the checks and balances of having two people monitoring the money.) Write up a paragraph on each of these key people, describing their qualities and abilities. If you are going to have Executive level people managing sales, marketing, etc, you would want to put in a paragraph on these people as well.
Guess what, you just wrote your Executive Summary of your total Business Plan!! In total, it probably came out to three or five pages of copy! You are almost done!! (Ok, you have some work ahead of you, but you have the outline in place for the rest of the work.) Again, these pages should only summarize where you are going with your company over the next three to five years. This is a document in and of itself that you will be using in your initial presentations, as a PART of your presentation, for going for outside funding.
Now, within this document, go to a new page and copy the WHOLE THING back into the document. From here you now start getting into more detail.
For each product you have, you need a page or two mapping, assuming a new company and new products, the development of the product, what the product is and how it works, etc. Go into more detail on the market, who the competition is, and how your company differs from these folks. In expanding on your sales review you will need to post your first three to five target clients you want to land. Give details such as who to contact, how they buy your type of product, etc. THIS SECTION NEEDS TO BE UPDATED, as does every section, AS YOUR CLIENTS ARE ACQUIRED OR DROPPED! Get into more detail on the kind of people you need to hire, especially in key positions, time lines, cost, etc.. Give full profiles of your Key Executives.
You now have 95% of your full business plan in place. The next thing to do is create your financial data sheets that outline your first two years expenses and income by month, the next two years by quarter, and the fifth year by year. Again, these are approximates. If your company has been around for any length of time, with expenses or revenue, you need to put in historical data, in front of "future" pages, as well to keep you up to date in your plan of how you are going historically as well as in the future.
You have now created a document that you can keep an eye on your company and direction from, and that you can present to funding sources as an outline of how you are going to spend their money once they hand the money over to you. But the key is to keep this document current. It isn't so big so keeping it up to date shouldn't be the hassle that many of the current tombs out there are, and it keeps you on track!! If you change tracks, change the plan!
If you write a business plan to guide and manage your company from, which changes as your company changes, you will be more apt to meet your goals.
Create and write a presentation, centered on your plan, as your Fund Search document. In that document, you can target your funding source, but your plan remains a valid, living and breathing business plan, that you can, and should, continue to use after you get funded.
Don is a Venture Capitalist with over 15 years of successfully funding early stage Ventures. Information on his fund can be found at http://www.tdbellenterprises.com/fund.html His company also consults start up companies on business plan development and start up strategies. http://www.tdbellenterprises.com
More Resources
Unable to open RSS Feed $XMLfilename with error HTTP ERROR: 404, exitingMore Strategic Planning Information:
Related Articles
Content Management: Wise Investment for Business Prosperity
The time when a website was just a simple set of HTML pages has gone by. It's true, just five or seven years ago simple websites developed with HTML and JavaScript were usual.
19 Questions to Supercharge Your Business Plan
Whether you are seeking capital for your company or are optimizing your business strategy, the most important element - particularly for outside investors - may be your written business plan. You can tune-up and supercharge your plan using this 19-step checklist.
In Business Planning, Competition is Good
When developing the competition section of your business plan, companies must define competition correctly, select the appropriate competitors to analyze, and explain its competitive advantages.To start, companies must align their definition of competition with investors.
Business Results - Four Critical Success Factors
Scenario OneDuring a recent presentation, a business owner was given the following challenge. If 10 of his 100 employees were asked to name the top 3 organizational goals for the current year as they perceived them to be, would he receive the same 3 goals from everyone or would he receive 5, 10 or even 25 different goals? The business owner shook his head and thoughtfully responded, "No, I am sure that I would receive more than 3 goals.
Why Six Sigma Will Work in Healthcare
If ever there were an industry where we want zero defects, it's healthcare. Patients, medical professionals, and healthcare administrators all want mistakes eliminated and quality and efficiency improved.
Take A Systems View To Ensure Your Business Stays Healthy
How are you feeling today? Good, not so good, great? Let me ask the same question in a different way: How is your gastro-intestinal system functioning today? What about your lymphatic system? How's the old circulatory system flowing along? Are all your bodily systems aligned, in sync, and cranking at peak performance?In order to get everything done perfectly and on time, your body must use many systems that effectively work side by side. Just as it is important to take a systems view when it comes to your body's health and well-being, it is equally important that you have a clear understanding of your business and its organizational systems.
Hunters and Gatherers - Are You Serving Both Their Needs?
The University of Exeter in the United Kingdom recently published research financed by Barclays Bank, which has implications for everyone who is serving the general population.This research shows that consumers shop establishments based on one of the two personal profiles.
Strategic Acquisition Strategies for Small Businesses
Growth through acquisition should not be considered an option reserved solely for large or Public Companies. Small and mid-size businesses that opt to grow by acquiring other companies, rather than growing one new customer at a time, can gain benefits in addition to increased sales and profits.
Microsoft Great Plains in Advertising & Publishing - implementation highlights
Microsoft Great Plains, former Great Plains Dynamics is excellent fit for service oriented business and in this small article we'll give you magazine publisher and advertiser implementation and reporting scenarios. The system we describe is not real, we are putting together industry specifics, based on our consulting practice.
6 Changes You Can Make to Increase Business Profits
I read once that something like 30 percent of all drinkable
water gets wasted on the way to the consumer by leaky pipes.
Likewise, your business may be letting potential revenue
drip away, to be lost forever, all over the place.
Strategic Planning and Total Quality Management
No matter what product or service you provide you will have to face this issue of quality and systems. Whether it is distribution of services or streamlining of processes in manufacturing your product; you will need to address the issues of total quality management.
Business Plan Financial Projections: Stop Worrying About Being Right...
Business plan financial projections seem daunting because
they are so uncertain. This very uncertainty, however, is
what makes preparing them easy because you can't possibly be
right.
Is Plan B Ready?
Business owners and entrepreneurs are, by nature, risk takers and adventurers. If we didn't have that "optimism gene" floating around, not much of any progress would ever get done.
During the election we heard about Ohio's Economy
Much of what we heard in the mass media about Ohio and the down and out economy was the fiction of spin-doctors of politics who wanted to oust the current sitting President. On further review and first hand observation and experience Cincinnati has people moving in and economic expansion.
What Every Service Provider Ought To Know About Writing A Business Plan
It's easy to lose sight of what needs to be communicated to prospective investors when writing the various sections of a business plan. Successful business owners/entrepreneurs use each section of their business plan to work up interest, to present arguments and, most important, to build trust and confidence.
How to Start A Business Plan
A business plan precisely defines your business, identifies your goals, and serves as your firm's resume. The basic components include a current and pro forma balance sheet, an income statement, and a cash flow analysis.
How to Grow Your Business by Clearing the Way to Growth
Is your business growing as fast and effectively as it could, or is it stuck at the same level it has been at for years? Research (Larry Greiner, 1972) has discovered 5 specific stages of business growth. Most business never grow beyond the second level.
Benefiting from Strategic Thinking
I recently took an organizational behavior class where my professor conducted a strategic thinking exercise in which groups of students were to be a part of a scholarship committee. The purpose of our committee was to use strategic thinking on allocating a scholarship budget to reward several incoming freshmen to our university.
How Good Is a Business Plan To Your Business?
You know you need a business plan. You probably realize that it is one of the best ways to get your business up and running.
Strategic Planning Fundamentals
Strategic planning is vital while starting a new business or expansion of an business or planning to boost the performance of an existing business. But it requires detailed strategic planning and controlled deployment activities.
Restaurant Startup - Part 1: Market Research - What are Potential Competitors Doing?
The first step in starting a restaurant is proper planning. One must lay out a plan complete with goals, priorities, and the tasks that he will need to complete in order to achieve these goals.