Tuesday, June 26th, 2007...10:59 am

Follow Up To The Essentials of Business Plans

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Yesterday I posted about the critical elements of a business plan. I had a list of 50+ things you can include in your plan, but which are of varying importance.

So, here’s what I came up with, based on asking, “Can I delete this info & still have a good chance at getting $5 million in funding?”

CRITICAL– spend the most time on these:

Soft Info

  • Traction
  • Notable achievements to date
  • Introduction from someone
  • Being prepared & able to answer tough questions from people looking critically at the concept

Management

  • Management’s experience
  • Management’s ability to execute

Finances

  • Sales projections
  • Revenue model
  • Pro formas:
  • Balance sheet
  • Cash flow
  • 3-5 year financial projections
  • Current assets, liabilities & resources

Product

  • Compelling product description
  • Problem/solution statement

Market

  • Competitive Analysis
  • Detailed analysis of competitor’s products
  • Market data
  • Industry trends
  • Target market profile

GOOD TO HAVE– This stuff can help tip the scale if done well, spend time on it if you can:

Management

  • Strategic partnerships
  • Strengths/weaknesses assessment
  • Vacancies in management to be filled by new hires

Supporting Docs

  • Bios
  • References
  • Client testimonials

Marketing

  • Marketing strategy
  • Marketing tools

Operations

  • Operations plan
  • Timeline for staged growth
  • Supply-chain management breakdown

Sales

  • Current high-profile clients
  • Sales cycle plan

Finance

  • Use of funds/proceeds
  • Personal financial statements
  • IPO plan
  • Equity/stock details
  • Exit strategy
  • Financial partners
  • Past & current investors

Product

  • Photos of the product

Soft Info

  • Milestones
  • Company history
  • Powerpoint presentation
  • Executive summary

OPTIONAL– cut anything you don’t need, spend the least amount of time possible to do a decent job:

Presentation

  • Cover
  • Table of contents
  • Page numbers
  • Logo
  • Pictures
  • Cool binding (spiral or otherwise)
  • Appendix

Soft Info

  • Mission statement
  • Keys to success

Support

  • Legal, bank, and accountant info
  • Bios for the board of advisors
  • Resumes of key players

Competition

  • SWOT chart

Operations

  • Description of facilities

Marketing

  • Your story
  • The story of your product
  • Company branding strategy

***

What do you think?

3 Comments

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3 Comments

  • Daniel Berch
    June 28th, 2007 at 4:12 pm

    This seems to cover all the key issues. You made a point previously that the goal of a business plan is to crystallize the idea by writing.

    There are two reasons to write a business plan:
    1) As you said, to figure out what it is you want to do and identify any points of failure or weaknesses so they can be fixed *before* investments are made

    2) To craft a business plan that can be used to “sell” potential investors on the idea. Investors (notably venture capitalists) look at three things: the market, the strength of the business concept, and the management team. Good investors require all three.

    Great initiative with your $100 businesses!

  • olynnduncan
    July 15th, 2007 at 11:23 am

    Daniel,

    Thanks for your comment. :)

    I think it’s important to note that an incomplete or “weak” business plan doesn’t mean that the business can’t/won’t work, but it does mean that the entrepreneur has a lot more work to do!

  • Why you need a business plan… « Market Like You Mean It
    July 25th, 2007 at 10:36 pm

    […] If you need a boost getting started, check out Carolyn’s article over at the Hundred Dollar Business about the essentials of a business plan. BPlans.com might also give you some inspiration (i.e. - templates). […]

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