preparing your business plan
TRANSCRIPT
Preparing Your Business PlanDale NugentVenture Development ExecutiveOffice for Technology Commercialization – Venture Center
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Food for Thought“You were born to win, but to be a winner, you must plan to win, prepare to win, and expect to win.”Zig Ziglar
“Our goals can only be reached through a vehicle of a plan, in which we must fervently believe, and upon which we must vigorously act. There is no other route to success.”Pablo Picasso
“A good plan violently executed now is better than a perfect plan executed next week.”George S. Patton
“When we are sure that we are on the right road there is no need to plan our journey too far ahead. No need to burden ourselves with doubts and fears as to the obstacles that may bar our progress. We cannot take more than one step at a time.”Orison Swett Marden
“Founders go wrong when they start to believe their business plan will materialize as written. I advise entrepreneurs to burn their business plan - it's simply too dangerous to the health of your business.” Alexander Osterwalder
“Don't plan too hard, because something much better might be out there.”Candy Crowley
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Simple Conclusions…
1. Prepare a plan that is not overthought but that you are totally sold on. Complete the first step all with fervent belief that nothing will go wrong and while keeping your eyes open for something better because sticking to your plan could sink you!2. You are a winner…but you could lose…so why do the hard work of writing a business plan?
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Business Plan Value
"You're two and a half times more likely to get into business"
Study of 800 firms by William B. Gartner Ph.D., Clemson University
Valuable Process• Test, Test, Test Business Model• Hone Most Powerful Messages to Communicate Value• Build “Ownership” within the Company
Valuable Uses• Build Investor/Bank Interest• Recruit Employees• Communicate to Partners (Vendors, Licensors)• Legal Disclosure/Due Diligence
NOT the right starting point for deciding how to talk to customers
Write to this primary audience
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Foundational Documents for Planning and Pitching Your Company
•Elevator Pitch“Pitch Deck”
•One PagerExecutive Summary
Business Plan
•Legal Version of Business Plan with Added Disclosures and Investment AgreementsOffering Document
•Value Proposition Design•Business Model Canvas•Basic Financial Model•OTC “Ten Questions”
Lean Start-Up
Focus on Establishing your Value Proposition and Product Market Fit Move on to completing Business Model Canvas and Financial Model Hone Investor Promotion PiecesDevelop Business Planand Offering Document(if required)
Manage effort, remain flexible until you’ve achieved a strong positive reaction to , , and
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Most Valuable Player!One Page Summary
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Typical Business Plan Topics
• Executive Summary• Company Description• Market Analysis• Organization & Management• Service or Product Line• Marketing & Sales• Funding Request• Financial Projections• Appendix, Detailed Exhibits
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Venture Center – Ten Questions
1. What is the problem?2. What is the solution?3. What are the solution’s features and benefits?4. What is the value of the benefits and how would you reflect it in your
pricing?5. What are the barriers to entry for this approach?6. What are the initial markets and size of market?7. Who are the competitors and what is our competitive advantage?8. What are the technology milestones and costs to make the solution work?9. What are the company milestones and the cost of getting through each
one?10. What are the comparable companies valued at in the market?
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Investor Perspective - Risk
Opportunity: • Who will buy your product and why?• Uncertain market size and growth• Uncertainty about product and/or technology• Risks in business strategy/model
• Sales/channel strategy/sales cycle• How will competition respond?
Management: • Quality of management• Questionable performance to date
OR
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This is One Important Paper
• Treat this like the top persuasive paper of your life• SUBSTANCE AND EVIDENCE MATTER
• Focus on being CLEAR AND CONCISE• Call upon others to read your work and comment…especially people
who do not understand what you’re doing.• Appearance counts
• Clean layouts• Use graphics and pictures
• Copy in small batches. Your work will likely change.• Exception: Offering Document, updates should be done in form
of addendum provided to all recipients
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Exercise: Where are you at?
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Still trying to lock down Value Proposition
Validated Product/Service and Market I'm trying to hire people I'm trying to raise money I'm trying to get a
licenseI'm trying to attract
partners
Complete Value Proposition Canvas and Test via Customer Discovery
Try to answer "10 Questions"
Complete Business Model Canvas
Complete Financial Model (Try to keep it simple, constantly test assumptions)
Complete One Pager
Complete Pitch Deck
Complete Executive Summary (if more extensive then one pager)
Complete Business Plan
Complete Offering Document
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ResourcesWhy do it? Do you really need a business plan? When?• http://www.entrepreneur.com/article/198618• http://www.inc.com/minda-zetlin/should-you-write-a-business-plan-2-experts-debate.html
Business Plan Sample• Tychon Bioscience Business Plan
• Includes One-Pager ExampleOTC Ten QuestionsOne Pager Template
SBA Site• https://www.sba.gov/writing-business-plan
Sequoia Capital• https://www.sequoiacap.com/article/writing-a-business-plan/
available by request: [email protected]