copy of business plan with social impact statement

8/2/2019 Copy of Business Plan With Social Impact Statement

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Business Name

Author 1 (email)Author 2 (email)

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Table of Contents

Executive SummaryImplementation DetailsIndustry AnalysisCompetitive AnalysisMarketing Strategy

Project PlanFinancialsMilestonesExit StrategySocial Return on InvestmentSummary

EXECUTIVE SUMMARY

The Executive Summary is your chance to tell a story. It should be no more than 2 pages long, detailing an existingopportunity or problem in an industry and how your business will meet a need, take advantage of an opportunity, or solvea problem. A good business plan reads like a story. In this section, you persuade and entice your readers into readingyour entire plan. The solution should include a brief description of why your solution is unique, how much it will cost todevelop, and how much profit you expect. It is not unusual for partners, angel investors, and venture capitalists to readonly the Executive Summary. Therefore, it is vital that you concisely describe your entire company here.

The opening line should be one or two catchy sentences describing your business. Such as: Light House Entertainment willlead the industry in the development of innovative and trend setting educational tools. The flagship product will be aneducational game for students in grades kindergarten through eight grade.

Now describe the problem. Is there an unmet need? Is there an inefficiency in the market?


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THE SOLUTION - EXECUTIVE SUMMARY PAGE 2

Describe your solution in one page. Describe in detail how you want to address the problem or opportunity you laid out inthe executive summary.

ANALYSIS OF YOUR SOLUTION AND YOUR BUSINESS

This section must contain a detailed description of how you are going to run your business, what you are going to build,sell, or provide. Subdivide this section as needed.

INDUSTRY ANALYSIS

Lighthouse Entertainment must understand the educational software market and must also comprehend the customersand competitors in other traditional educational markets. This section will first describe the educational software marketand then shift focus to the traditional tools used today.

SECTION TITLE SHOULD BE THAT OF YOUR INDUSTRY

CURRENT SIZE

How many customers exist currently? How much money do they spend? What products or services do they use today?

INDUSTRY TRENDS

What changes are currently happening in your market that might effect your business?

GROWTH POTENTIAL

What is the value of your business based on? Here you should describe how industry growth will affect your business

potential.

Table 1 Based on Data from Reliable Data, Inc, the Educational Software Market Size

Year 2008 2009 2010

Total Students 299,800 350,000 452,000

Total Revenue Spent $43,434,600 $85,416,150 $113,581,225


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By Students

SECTION TITLE FOR ANY RELATED INDUSTRIES

If there is an industry that effects your business that you are hoping customers will leave to come to you, or if anotherindustry's growth will harm or improve your own company's, then you should include an analysis that includes the same

sections as your primary Industry Analysis.

CURRENT SIZE

How many customers exist currently? How much money do they spend? What products or services do they use today?How much money do they spend?

INDUSTRY TRENDS

What changes are currently happening in your market that might effect your business?

GROWTH POTENTIAL

What is the value of your business based in? Here you should describe how industry growth will affect your businesspotential.

COMPETITIVE ANALYSIS

Who is your competition? A competitive analysis should describe your competitions' strengths and weaknesses. Compareyour business to them. What things do you do better and what things do they do better. Admitting weaknesses is OK - infact, investors will see right through a competitive analysis section that says, "We have no competition." or "We are betterin every respect than everyone else!". If you are a non-profit, your competition may be less obvious - where do thedonations go today or where are these services provided today?

DIRECT COMPETITION

Who offers a product or service very similar to your own?

INDIRECT COMPETITION

Your potential customers are spending their money somewhere today, so there is always competition. You should includean indirect competition section if you believe there may be competition from other industries that you'll need to address.


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MARKETING STRATEGY

How do you plan to tell the world about your product or service?

MARKETING AND PROMOTION

Describe what avenues you plan to use to promote your business.

CHANNELS OF DISTRIBUTION?

If you are selling a product, how will the product reach the customer? If you are a service, do you need a store-front?Where will it be? Do you need partnerships with distributors or manufacturers? Will you build your widget in your garageand sell it on the Internet?

CUSTOMER RETENTION

Once you gain customers, how do you plan to keep them. This is especially important where barriers of entry are low andnew competitors can copy your business model easily.

ALLIANCES

What partnerships have you or will you form to become successful? If you didn't discuss advisers in a previous section, youmay want to include here who will advise you. These may be mentors, bankers, or friendly partnerships that plan to helpyou get started.

PROJECT PLAN

How do you plan to build this business or service. Describe who will be involved and give a detailed timeline.


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TIMELINE FOR LAUNCH

Figure 1: Timeline for Launch

Year 1 Months 1 through 12 Raise Money

Year 2

Months 12 through 18

Months 18 through 24

Hire staff and begin design phaseBegin designing game levels

Year 3Months 24 through 30Months 30 through 33Months 34 through 36

Development toolsAlpha Stage TestingPromotion, conventions

Year 4 Months 37 through 48 Have 30,000 users

Year 5 Months 49 through 60 Goal reached: 120,000 users

ALTERNATIVE LAUNCH APPROACH

It shows good planning on your part to plan for failure. Here you should describe your alternative plans if any of your keymilestones are missed.

LOCATION OF OPERATION

Where will your business be located? Why will your business be located there?

COMPANY STRUCTURE

What will your legal company structure be? Proprietorship, partnership, LLC? If you will have more than a handful ofemployees, describe your business hierarchy, departments, or divisions.

FINANCIALS

In order for your business to be successful, you'll will need X million invested into the company by what dates? Yourfinancial section should explain your financial plans in prose and in table form.

Financials typically include five year projections. What? Don't know how much money you'll make in five years? At thispoint, it is understood that your financials are only estimates. You should be able to concretely define your operatingexpenses, but you'll need to rely on your research into the industry and market analysis to decide on your possible growthrates and income potential. Be sure that any assumptions you make (number of customers, growth rates, etc) are clearlyexplained.

The financials that follow are intended to provide a general idea of how much it will cost to develop and launch yourbusiness, and where the money goes. The financials are estimates, and are intended to be used as a guide, they areneither goals nor guarantees.


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Use this space to further describe how much money you need invested and what it will enable you to do.

Income Statement

Figure 2: Five Year Income Statement Projection

Year 2 Year 3 Year 4 Year 5

Sales:

Sales Allowance

Net Sales

Operating Expenses:

Wage Expense

Depreciation Expense:

Hardware

Depreciation Expense:Software

Rent & Furniture Expense

Supplies Expense

Total Operating Expense:

Other Expenses:

Miscellaneous Expenses

Selling Expense


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Marketing Expenses

Total Other Expenses:

Total Expenses:

Tax

NET INCOME

These numbers are based on information from the following sources:

(a) Wages based on headquarters in Seattle, WA determined through monstersalaries.com

(b) Hardware priced determined from


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Software

Less A/D1

Total Assets

Liabilities

Wages Payable

Rent & FurniturePayable

Taxes Payable

Total Liabilities

1 Subtract appreciation and depreciation costs from the previous line.

CASH FLOW PROJECTIONS

Discuss your cash flow strategy here: Cash is the lifeblood of any new venture. We are committed to maintaining a positivecash flow from day one. Lighthouse has carefully projected the payment of expenses in a manner which preserves cash at

all times. Payments on wages, rent, and furniture for the last months of one year will be paid in the next year. Taxes willalso be paid in the year after they are incurred, which is normal for a partnership.

Figure 4: Five Year Cash Flow Projection

(At Year End) Year 1 Year 2 Year 3 Year 4 Year 5

Cash Inflow:

Cash, Investments

Cash, Beginning

Cash Inflow from Operations

Total


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Cash Outflow:

Wages Paid from Year Before

Wages Paid this Year

Purchase of Equipment

Rent & Furniture Paid from Year Before

Rent & Furniture Paid from This Year

Supplies

Miscellaneous Payments

Conventions, Selling, & Marketing

Taxes from the Year Before

Total

Cash, End:

Summarize your expenses in prose below the cash flow table.

SALES PROJECTIONS

How will my sales grow over the next five years? What are these projections based on? You may wish to include a tablethat describes each year of your five year plan that will have sales. The example below is for a business that doesn'texpect sales until year 3.

Figure 5: Sales Projections

Year 3Number of NewCustomers

Number of ReturningCustomers

SalesTotal

% Growth inRevenue


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Jan - March 30,000 @ $5 each 0 150,000

April - Dec 10,000 @ $5 each10,000 @ 9.50 each,20,000 @ $100

478,333 76%

Sales for Year 3$628,333

Sales Allowance for Debt(10%)

62,833.30

Net Sales for Year 3$565499.70

Staffing

Describe your staffing needs and costs. You may wish to include a graph like the one pictured below. Delete it and replaceit with your own image.


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SUSTAINABILITY

The final section of your charts should include a chart detailing cash flow and net income. When will you reach positivecash flow? When will you break even? When will you pay back investors?


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MILESTONES

Describe your milestones in a bullet list.

Within one year raise $4 million (approximately 70% of the total funding needed).Within six months of game development, begin work on tools and game mechanics.Six months before launch, finish alpha testing and begin beta testing.

By the end of year three, launch game.Three months after launch, have 300,000 users.Five years after embarking on this task, reach your goal of having 120,000 dedicated users.

EXIT STRATEGY

Describe all of your exit strategies. It is possible that you don't have one (you are a Mom & Pop store and plan to workuntil retirement and close the store), but most larger businesses have them. This may simply mean growing the businessyourself to pay off all of your investors or selling your business to a competitor.


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SOCIAL RETURN ON INVESTMENT

Whether you are a for-profit or non-profit, everyone should consider what their social impact on their community will be.For a non-profit, the SROI is the main tool to advocate to funders how dollars will be converted into social impact. Itincludes a detailed explanation of the possible impacts that the project will have on society and often contains quantitativeanalysis. Quantitative analysis might calculate tax savings for government welfare agencies to less tangible measurementssuch as the impact of improving community relations with their homeless population. It is a tool to answer the questionWhat will our impact be on the community?". This analysis can include financials, but need not if the impact is too difficultto predict.

But I'm a for-profit, I don't have a social return? I just want to make a profit.

Entrepreneurs create businesses for many reasons. From a desire to get rich to being part of something new, the reasonsare diverse. The absence of a SROI from most business plans is the tell-tale sign that entrepreneurs dont consider this anecessary step to start a company. All businesses have a return on investment, where they attempt to predict what thefinancial return will be given X dollars invested. The same should be done with social impact. Given X dollars, what will thesocial impact be? Entrepreneurs often forget to reflect upon what this good may be, but that does not mean it is absent. Anew venture doesnt need to save the world, but it is crucial that the entrepreneur discover what the good is they wish tocreate. Maybe the entrepreneur wishes to create a good work environment and support the employees and families of theiremployees and customers. Perhaps the entrepreneur wishes to earn a profit so that they may make donations to a favoritecharity or maybe the services itself offered by the company can have a positive social impact. Regardless, there is noentrepreneur without some innate desire to do good the mission is to discover what this good may be.

SUMMARY OF SOCIAL IMPACT

Bullet list of areas your venture will have a positive social impact on.

Example:

Educate Local City on homelessnessEmploy homeless and provide an alternative incomeReduce panhandlingProvide positive outlet for employee's children to volunteer

DESCRIPTION OF WHOM OR WHAT WILL BE IMPACTED.

Example: E-Mentoring will provide mentoring to high school students in non urban settings. These students will be providedwith a mentor in a career they have interest in, but may not be represented in their rural area. Each student and mentorwill be guided through a process of mentoring and career guidance by E-Mentoring counselors, culminating in a capstoneproject by the student describing their post graduation goals.

METRIC TO EVALUATE RETURN ON INVESTMENT (OPTIONAL)

Example: If the social impact can be quantified, you should describe it in a manner similar to your financials. Redf (redf.org)has a fantastic SROI model that you should consider using as a starting point.

SHORT TERM IMPACT


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At the end of the week, what will your venture have accomplishments?

LONG TERM IMPACT

In five years, what will your venture have accomplished?

CONCLUSION

You have reached the home stretch. At this point, you should take at most one page to summarize your business. Describeyour solution, how you will it accomplish it, and how much money you need. This is one last chance to appeal to potentialinvestors, so remember to recap a high-level description of needed funding rounds and potential returns for thoseinvestors.

Now that you have reached the end, be sure to go back and reread your Executive Summary. Does it still make sense? Didyou discover information on the way that changed your approach and plans? Update the summary to reflect that.

copy of business plan with social impact statement

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