Watch this free presentation and find out how other entrepreneurs wrote their business plans in just one day!
Ask yourself these three major questions before writing your Business Plan:
1. How much money do I need?
Do not just guess. It is better is your are specific to the dollar and come up with different ways of actions depending on how much money you raise. The common question venture capitalists ask is how you would use less money than you are asking for. The best answer to this question is a mix between the priorities and the crucial actions necessary for your venture to run and the things and actions you can dispense.
Use real facts to make some assumptions and prove that your capital needs are realistic and include these arguments in the Financial Plan. Real facts means actual research you undergo for the Company Analysis, facts like the target market, the trends and common practices in your field (Industry Analysis) and the Competitive Analysis.
2. How much is my company worth?
This is the Valuation stage. The Valuation can be pre-money or the value of your company before getting funding; and post-money, how much your company is worth after the funding.
The actual value of your venture will not be stated in the business plan, only hinted. You can hint this by including:
A) Real data regarding the market size, needs, and growth rates;
B) Barriers to entry needed to block out the competition, i.e., aspects, technology or people that can help your venture be the only one that can handle the demand
C) Real facts and proof of the qualifications and experience of your management team.
When asked ΓÇ£What is the valuation of your company?ΓÇ¥ you answer that the investment market will decide this. The key is to approach many investors in the same period to create competition and demand, therefore increasing the value of the venture.
3. What is my exit strategy?
The exit is defined as a liquidation event that can be an IPO or a buyout. That is the moment when investors will get the money back and great profits.
This event is unpredictable. You can however control and predict the growth of your company. Control your company, know everything about your products and services and be prepared. Investors can pick this up from the business plan.
Analyze the competition and the industry. If you have knowledge over this you can describe with real arguments who would be likely to acquire your venture once it has reached the growth you aimed at. The milestones will be present in the Operations Plan and Financial Plan.
Before starting your business plan, watch this free presentation to discover how to finish it fast and write it exactly how the investors want to see it!