[AnuFriend]

How well versed are you in writing a business plan? Do you feel it is essential for your start-up? Did you consult any professional help to assist in completing your plan and/or proposal? How did you present your business plan to the financial institution or company? What steps have you taken to ensure your business plan and presentation were as good as it could be? Also were you successful?

From start-up at which point would you involve professional help, like an accountant, lawyer etc. Would you get the funds and all in place before presenting your proposal? Would you create your business logo, pamphlet and website. When would you decide to bring all that into play?

Don

[noob]

I've had several successful businesses in my time including startups and I never formally had to write any business plan. However, after starting up some of my companies, sometime within a year or so, began to build a clear roadmap of where the company was headed. However this was only because I was able to self fund the company and grow it without any outside income sources.

If a startup requires VC or angel funding, I would recommend writing up a formal business plan. If not, you can suffice without a formal one but rather a clear roadmap of where your company is headed, a mission statement if you will. You definitely don't need a professional to assist and often times depending on the nature of your business model, some professionals can do more harm than good helping you write your business plan. However it never hurts to review sample business plans to give you an idea of how you want to structure yours. I don't necessarily disagree that consulting a professional is bad either. It's a case by case thing.

As for accountant, lawyer, etc... While I have started many businesses without having to utilize these type of services, for my bigger startups, I went with a lawyer from the beginning. Beyond incorporating, etc.. it was a world of difference and if you can afford it right out of the gate, I would highly recommend it but be forewarned. I've dealt with many lawyers in my time and finding the right one can and will take time. As for an accountant, when the business started making serious money and payroll became involved, that was when I brought one on board.

Business logo and website design were all done in-house so that never became an issue. Pamplets, etc... same thing. The only thing I outsourced in terms of pamplets, etc.. was dealing with hiring employees and the correct procedures on how to approach this legally. I did so without a lawyer by consulting a professional agency who handles new employment for startups and had their own legal team. This way I avoided spending unnecessary costs on lawyers with the same professional help if not better.

Hope that helps.

[AnuFriend]

Thank you very much for your input; it is very much appreciated. This is my first start-up. I have little knowledge of business and how to start-up. I have relied on a small business enterprise center (which provide free business consultation funded by the province and the city), a book I purchased Business for dummies and the internet. I thought writing a business plan was challenging but I have completed most of it. Although I am stuck at financial part of the plan. Predicting sales, income and expenditures, this is why I thought an accountant would be helpful. I am not sure.

[JKProsperity]

A business plan that keeps you on track is priceless. That said, I think you're talking about a business plan that others will see.

That type of business plan is just another form of communication. It can help you get funding, or if it contains the wrong information, can keep you from getting funding.

First determine your goal in writing the plan. If its just for you, that's one thing. If it's meant to persuade others, that's completely different. And if you need help with the latter, let me know.

[Neustance]

Its important, a business plan lets you visualize problems and obstacles before you actually have to face them.

Of course there are all types of business, if you are just doing a simple website you may not need one but of your doing a business that deals directly with customers be it a service or retail, a business plan is a MUST. Its not whether you can get away without one or not, you just need one if your serious in what your doing. A lot of people here do one person business just to get money, those thing are not complicated. Where it gets complicated is when you have to get insurance, pay 3+ employees, do advertising, get sales, get customer...that's where the real game comes to play, when you have to directly face your competitors to be in in the lead.

For me, if you don't have to do a business plan your not doing the right business. As a entrepreneur its ok to take risks, but not randomly. You research, you plan, you study your industry. Without a business plan you can only see so much farther down the road, as stated above only relying on the mission statement. Yeah, that's a great motivation factor, for example being the best consulting agency, but its not going to get you far. A good business plan will let you see how and when you need to get things done, set specific goals and reach your milestones.

The best advice I have been given is that success is in focusing. Do things step by step, focusing and working on individual milestones delivering your full potential on achieving something in specific. There's no way to be the industry leader or a reasonable competitor if you just want to be the best. You make a strategy on how to be the best and put it in action.

Hope it makes sense! Good luck.
Francisco

PS: Just begin writing, that's all it takes.

[noob]

Originally Posted by AnuFriend

Thank you very much for your input; it is very much appreciated. This is my first start-up. I have little knowledge of business and how to start-up. I have relied on a small business enterprise center (which provide free business consultation funded by the province and the city), a book I purchased Business for dummies and the internet. I thought writing a business plan was challenging but I have completed most of it. Although I am stuck at financial part of the plan. Predicting sales, income and expenditures, this is why I thought an accountant would be helpful. I am not sure.

I guess my next question would be how big are you planning on growing this new startup. Some people plan on making their startup the next multi-million dollar idea and some are trying to reach a goal as small as $5,000 to $10,000 per month and be satisfied with that. For example, a restaurant would have a hard time reaching $100 million in sales without opening up multiple locations, or expanding in some way in reach. Where do you see your start up headed and realistically how much capital do you need to reach this point. That would be your pitch if you're looking for VC and angel but honestly you probably won't get much.

Its all about who has the ball on the court, aka the advantage on the bargaining side. When you have no income history for the business and everything is base on potential and what could be, you have a very small bargaining chip and the advantage lies on the VC and angel side meaning IF they choose to invest at all, it won't be much for probably a cut throat percentage of shares. Your ideal situation is to grow the business to a sustainable point, prove ROI and growth base on earned income, and then try to get outside funding to accelerate business growth. This way you're in a position of strength because you've proven growth and not base your grow on potential.

The other alternative would be to seek private funding through partners. I would highly advise against bank loans or of those similar sorts of funding unless this is absolutely your last resort. Even approach family and friends if possible. As for the accountant, they can't help you predict any better than you could. They're there to make sure your books are clean and keep a record for you (most accountants don't even do this, you need a book keeping service which is what I use who then communicates this to the CPA on my behalf).

What is your immediate goal and why are you trying to set up this business plan? Is it so you know where the business is headed or is this primarily about funding or are there other factors I'm not seeing?

[AnuFriend]

Interest points made. My objective for having completed a business plan was to obtain funding form an outside source. Why may I ask do you discourage seeking financial assistance from the bank? I have a feeling this is due to high interests. My objective return in the first year is to produce 10, 000 return if not break even. My company is to provide a transportation service.

I was under the impression that accountants could help with business plans, at least the financial portion of it. This would be the result of my inexperience. I've read start up business for dummies and it suggested that accountants can be helpful with market analysis, etc.

Don

[noob]

I've never personally read any of the for dummie series so I can't validate the advice it would give. I can only speak from personal experience. As for why not raise funds through banks, I would only recommend it as a last resort but due to the way the economy is headed, getting a bank loan won't be easy and if you do qualify, the amount is limiting.

Yes a major part of it is due to the interest rate. The other major problem is bank loans begin repayment almost immediately leaving you with less cashflow to work with on scaling a company as a oppose to bringing on a funding partner, going angel, or VC (where there is no repayment and you retain cashflow to allocate to the business). Typically it is better to trade off shares (percentage of ownership) than it is to go the bank loan route simply because you offset payment and can grow the company accordingly without worry about paying interest rates. That said, going with the right angel or VC can have major other benefits including the network of connections they have.

A good example would be Sequoia. They are a VC firm that invest in several large companies including Apple, Google, Youtube, etc.. Who do you think faciliated the Youtube buyout deal and that Google should acquire it or for that matter even connect the two companies... the VC firm had a major play.

Long story short, the right partner or funding source can open doors to help the company grow. Most business startup founders have the skewed perception that giving off ownership is a bad thing as oppose to raising money through typical bank loans and pay interest allowing them to retain 100% of the ownership. Given all the possible benefits of going the other three routes, I think you would agree that owning 50% of a $100 million dollar company is better than owning 100% of a $10,000 company. Its all relative. Of course there are arguments that support both sides and I can only speak from personal experience and the experience of those I know who are successful founders.

I've explored all three (self funded, bringing on a partner, and exploring VCs and angels). I can tell you that most business professionals I've talked to and large startup founders and resources will apply the same advice. While I'm not 100% against it (as I want to make that clear if there was a misunderstanding), I believe it should be the last resort.

[AnuFriend]

That's terrific advice. I have/had that very skewed perception that giving off ownership would be a bad thing but you brought some really great insight to that. Definately something I will consider. Thanks Noob

[mightyventures]

Life is marketing. Marketing ourselves personally and professionally, marketing our products, marketing our ideas. Every day we are constantly marketing or being marketed to.

What constantly amazes me, is that knowing this, so few early stage entrepreneurs market their startup effectively. The business plan, executive summary, and financing pitch are the ultimate marketing tools. Marketing your startup successfully results in getting optimal investors, more favorable financing terms, outstanding executives, committed customers, basically a shot at success in today’s extremely competitive market.

Let’s start with the love-hate relationship we have with business plans. As a former entrepreneur, and a startup consultant today, I’ve certainly seen more business plans than I care to remember. Of the 30,000+ high tech business plans submitted to venture capitalists last year, less than 3% were funded. Why? The plans were either for products or services no one truly needed, or the plans were for great ideas that were not presented well. I see far too many of the latter. What a shame to have a brilliant idea, and the right process of executing it only to communicate the idea without being concise, compelling, and complete.

Be Concise - A concise plan provides a simple explanation for why the business is a great idea, as well as how it will be executed. The optimal length is 20 pages, but 30 is acceptable. This includes the 3-5 pages for the executive summary, but does not include the appendices (only include relevant info here to support claims made in the plan). Few of the investors will read the plan in its entirety. The goal of the business plan is for the entrepreneur to explain the company they want to build so they will a) be able to condense it and render an executive summary (that the investors will read) and b) have a basic execution plan for the company.

Be Compelling - A compelling opportunity is optimized by the right deal, with the right price, at the right time, with the right product/service and the right team. Compelling deals always get financed with favorable terms. The goal is to make your company appear to be deeply compelling. More on this below.

Be Complete - You must have a trusted third party review your plan to ensure it addresses all possible issues an investor may have. An incomplete plan, such as one that lacks three years worth of financials, or lacks a marketing or sales strategy, or a section describing the first few releases of a product and the high level technology strategy, makes it look like the entrepreneur hasn’t thoroughly thought out their business. This makes them look either unprofessional, fly-by-night, or both. Be complete – it will help you gain the trust of all who read your plan.

How To Do It - So, now you’re ready to create a killer business plan, which will yield a killer executive summary and a killer financing pitch. You’ll want to leverage your plan by using the content later for sales presentations, marketing collateral and white papers, recruiting pitches and web site content.

Here’s how to do it. Using the sample business plan outline, begin to fill in each section. Do not use a business plan package. These render “fill in the blanks” business plans that make the entrepreneur look inexperienced, unsavvy, and basically out to lunch. Don’t let yourself be branded this way. The key risks investors worry about are: people, technology, market, and financial. Financial risk is hard to remove. Focus on showing how solid your people are, how robust and extensible your technology is, and how huge the market you’re going after is. You must explain the barriers to entry too, in honest, realistic terms.

You’ll also need a financial model. Be sure to make it interactive, and not static. An interactive model is formula-based and takes 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 enable “what if” scenarios. Chances are good potential investors will slash your first year revenue projections in half. What repercussions will this have? Run it through the model and find out.

Life is marketing. Marketing your startup properly will result in a wild ride with life-enhancing results. Go for it and let me know how I can help!

[bweb4sale]

Businesswebsiteforsale is a London based online business and marketing company. Our focus is on providing the best and most up to date tips, techniques, strategies and training to help you buy, sell or build a business online.

[butler68]

A business plan is needed 99% of the time to get bank/sba or investor funding. I would be glad to offer anyone on this site a good deal on their business plan. We offer two levels of business plans. Level 2 - Business plan for SBA, Grant or bank funding. We also offer a Level 3 for customers who need a business plan for Investors. I have built over 1,000 financial models for business plans. Let me know if I can help.

[loanlive0]

It is really practical to consult a expert before starting up a business..
But it is a challenge for a newbie to make their own business plan that they will use for their business..

[inle]

There are a lot of GOOD advice given already..
So i just share something that i had learnt personally..

A business start up will surely need a business plan..
You got LIMITED TIME, RESOURCES, FUNDINGS to work with, & you got to leverage them as much ns possible & as best as possible..
From the above posts, i reckon that the business that is going to start is somewhat not as simple as a blogshop or a website..
Therefore, it has become extremely CRUCIAL to have a business plan..

I wont recommend getting professionals to help you in writing the business plan..
From my experience, when you write yourself, you are going through the process of testing the flesibility of your idea, how to make it work (better), how to budget & get a feel of the cashflow..
You got to convience YOURSELF first that your plan can work, will work & you can make it happen..

As for lawyers, accountants & business consultants, it will depend on what you need them for..
it will be good to talk to a couple of them & see how they can add value to your start up.l
Needing them is one thing; Finding the RIGHT one to do the RIGHT stuff for your business is another..

Do let me know if you require some insights in marketing..
i work with companies when they need to boost up their sales through creative, result-based & sellable ideas & strategies..
Maybe i can share with you on how to UP your inital sales figure with the careful planning & placement of your resources..

ENJOY..

[angle]

Hello
business plan - this is now rightly a very general and flexible term, applicable to the planned activities and aims of any entity, individual group or organization where effort is being converted into results, for example: a small company; a large company; a corner shop; a local window-cleaning business; a regional business; a multi-million pound multi-national corporation; a charity; a school; a hospital; a local council; a government agency or department; a joint-venture; a project within a business or department; a business unit, division, or department within another organization or company, a profit center or cost center within an an organization or business; the responsibility of a team or group or an individual. The business entity could also be a proposed start-up, a new business development within an existing organization, a new joint-venture, or any new organizational or business project which aims to convert action into results. The extent to which a business plan includes costs and overheads activities and resources depends on the needs of the business and the purpose of the plan. Large 'executive-level' business plans therefore look rather like a 'predictive profit and loss account', fully itemized down to the 'bottom line'. Business plans written at business unit or departmental level do not generally include financial data outside the department concerned. Most business plans are in effect sales plans or marketing plans or departmental plans, which form the main bias of this guide.