The Business Plan (BP) is the official company document that defines the focus, objectives and resources (human, intellectual property, financial, business practices) of the company. A well created business plan serves as a guiding document internally and as a pivotal communication piece to investors and potential partners. When properly constructed, the Business Plan can significantly enhance the fund raising process.

 

Problem

Entrepreneurs know their business and have a sense for its goals, but documenting this in a way to (a) keep all team members on the same page, and (b) communicate the company’s uniqueness to externals is a common challenge. Using a cookie-cutter approach is typically detrimental to the outcome, particularly when fund raising is one of the objectives. The time requirement to create and update a BP pulls the C-level management away from what they do best.

 

Solution

A customized business plan that digs into and clearly communicates all aspects of the company’s current situation, plans and goals has far reaching benefits. Potential investors, stakeholders and partners use the BP to assess their involvement. Corporate goals, processes, uniqueness are communicated among key employees. By thoroughly analyzing and reviewing all components of the BP including the competitive landscape, critical assessment metrics can be established for monitoring progress – for managing the new venture and for investors to monitor.

The BP is organized in a modular manner to facilitate the repeated referencing by potential stakeholders and enable easy updates. The first part of the BP must be a full synopsis.

• Introduction
• Mission Statement
• Keys to Success
• Summary forecast for revenues, net income, capital required

 

Other components along with their appropriate order are based on the unique issues the new venture is addressing and how potential investors and stakeholders view the space. Typical sections included are:

• Market(s) served, intro and dive into current structure and how it will be addressed
• Unique qualities (product/services, people, approach)
• Competitive landscape (industry, products/services, potential threats)
• Intellectual Property and Business Practices
• Product Development
• Business Development
• Go-to-Market plans for each market served
• Business model for each market served
• Manufacturing
• Regulatory issues
• Capitalization (current, and funding requirements)
• Organization structure (people, responsibilities)
• Financials (history, forecast). Need to justify forecast.

I create custom BPs pulling from my experience analyzing thousands of companies over 35 years. The objective is creating a document that can serve as the cornerstone of the company’s purpose and goals. Many times it is a dynamic document that requires updating as new ventures proceed to generate revenues and profits. A natural outcome from the process of creating a new BP or analyzing an existing BP is a strategic assessment of the organization, goals, strengths/weaknesses and capital requirements.

 

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