Business Plans 101 -- No Kidding.

When you're ready to pitch financers, investors, potential partners or even employees, the first thing you've got to have in place is a BUSINESS PLAN.  And the most important thing you can do is to put in the hours to make it perfect, because you’ll be repurposing the content in sales presentations, marketing collateral and white papers, etc., etc., -- and even on your website. Next, be sure to address the following:

* People (Have you hired the right ones?)
* Product or service (Can you build and deliver it? Will it fly?)
* Market (Is it big enough? Can you reach it?)
* Financial (How much will it cost us?)

When pitching potential investors, there’s no way to eliminate the financial risk completely, so focus on showing how solid your people are, how exceptional your product or service is (and why), and how huge the market you’re going after is PLUS how you’ll capture it. You must define your current and potential competitors too, in honest, realistic terms. Remember, your plan needs to reduce your investors’ fear of risk and increase their greed for gain.

When pitching investors (or customers or the press, for that matter), you’ll want to begin with an e-mail a list of the top five qualities that make your company compelling. This will increase the likelihood of catching their eye and getting them to read your executive summary.

You’ll also need a financial model. Be sure to make it interactive, which means it will be formula based and take longer to create than a basic static model. But trust me, you will definitely change your financial projections, so provide for flexibility from the get-go. An interactive model will also help you address “what-if” scenarios. Chances are good that potential financiers will slash your first-year revenue projections in half. What repercussions will this have? Run it through the model and find out.

I’ve said this many times, but it is definitely worth repeating: Your business plan isn’t cast in stone; it’s more like wobbling in Jell-O. Write it to clarify your thoughts, and then be willing to modify it (sometimes radically) or even toss it out completely. Don’t be afraid of any part of this process – no matter where you’re at.  Here’s the secret: everyone is making it up as they go along.

In order for your business plan to be Concise, Compelling, and Complete, you’ll want to include the following elements: A quantifiable explanation of the painful problem and how you plan to solve it; your company’s objectives, including an analysis of the competition; a description of your product or service, how you plan to achieve world domination with it, and which follow-on products you have in mind to up-sell to customers; five years’ worth of projected financials (quarterly for the first three, annually is okay for years four and five) and how you plan to cover growth and expenses.

You’ll also want to have ready:  Marketing and sales strategy, defining your pricing, product positioning, promotions, and the like (at the least a section describing the first few releases of a product and the high-level product plan); your team, and why they are exceptional; and your plan for overcoming predictable obstacles—for example, risk management and mitigation.

Include only the info necessary to support the claims you make in the plan. You MIGHT Appendix résumés of key executives, press coverage, white papers, or anything else to boost credibility. If you’re tempted to be more long winded though, imagine FedEx dumping yet another load of documents onto a busy financier’s desk. There are some slim, sexy Boxsters there, and then there’s your big, clunky minivan. Which plans do you think the investor will grab first?

Christine Comaford, CEO Freedom Fighter!
CEO of Mighty Ventures, Inc.
NY Times Best Selling Author
http://www.MightyVentures.com/bai

PS: I’m busy getting ready for weekend long BAI mentoring session. Twenty lucky participants will get to work with me personally and do EXACTLY what I’m talking about above: Learn to practice networking in a new way, a way that creates AMAZING bonds between people. If you think you’re up to the challenge and are ready to make the commitment of both the time and the funds to attend ($1,997 early bird special), email sales@mightyventures.com to save your spot or visit http://www.MightyVentures.com/bai for more information.

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