Business Plans: Getting Started

Whether you are planning to start a brand-new business, expand an existing company, or get financing for a business venture, you will need to write a business plan.  There’s no way around this unless you have a dead rich uncle who just left you his two-car garage full of thousand dollar bills.

Although writing a business plan can be a lengthy, intimidating project, it doesn’t have to be the end of days regarding getting your project in order.  There are key components for what to include in a successful business plan and if you can check these off of your list at the end, then you’ve done your job right. 

Your business plan needs to demonstrate that you have thoroughly considered all aspects of running your business. To that end, the standard business plan has nine major sections, covering everything from your business’s mission statement to a detailed financial analysis.  

Each of these sections needs to be sure to carry their own weight and stand on their own regardless of the differences in content or length.  Honestly, if an investor wants to skip ahead in your plan and not read, say, the market analysis and get straight to your management summary, the sections should be complete enough that they shouldn’t feel like they needed to read 20 pages of content ahead of their desired goal.  

Another note regarding business plan construction is the Executive Summary.  Many times, this section can double as your pitch document if constructed properly.  Its content should be highlights of some of the data and points made in the plan proper, but still be a single narrative that explains the project as a whole.  Also, if you can include a financial overview section after the Executive Summary, that will go a long way to help it function independently.  

Remember that you’re also going to need to actually speak to the content of your business plan.  Learn it inside and out.  Investors might quiz you on it or want to know more about a particular piece of market or financial information.  In some cases, leaving little bit of a prompt in a section will allow for you to make your presentation to create a dialogue between you and the investor because they’d like to talk more about that section.  

Also, the document is not there to do the job of speaking about the project for you.  The business plan serves the purpose of either getting your foot in the door by enticing the possible investor or being the leave-behind document that will help answer questions after you’ve departed from the presentation.  Nowhere in those duties does it actually do the job of securing financing without your ability to speak to it and the project as a whole.  For this reason, it’s always good to do practice presentations with another partner taking the role of the investor and having them pick apart your plan and presentation.  Criticism is not designed to hurt you, but rather to help you improve.  

Financials should be done by a professional or at least be proofed by one.  There’s no guarantee that your numbers will be perfect, but they should at least be accurate.  Also, keep in mind that they’re forecasting so that they should be conservative and growing at a rate that is realistic.  Don’t expect to hit the numbers out of the park in the first year.  A professional financial consultant can help you massage what are essentially fictional numbers into a presentable projection that will make an investor interested without skeptical. 

Last but never least, never fall in love with your plan.  Always be interested in continuing to evolve it and rewrite it.  The plan is never actually finished even after you’ve secured investment.  Also, getting defensive about the content or the presentation won’t serve anyone, so always be open for suggestions how to improve it even if they’re harsh.  The idea is to take in as much input as possible and fold that into a semi-final product. 

Business plans shouldn’t be daunting as an aspect of seeking capital, but the process is by no means easy.  Seek as much help as possible, remember to follow guidelines of structure and style, and never let the content be something you can’t speak to or aren’t willing to change.

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