InvestingMentoring

Structure of a Business Plan

I got another business plan today that fails to describe what the product does and how it works.

It also spends a significant amount of time giving client testimonials and potential market without explaining what investment is required, what its going to be used for. A ROI estimate would have been useful as well.

So I am publishing a previously composed checklist of items that need to be included in most business plans and the approximate order they need to come. I wrote this a few years back for a colleague to pass on to a new founder to help them produce a suitable plan.

Your business plan should contain most or all of these details. Also the running order should be very similar, If not, likely chances are it will disenfranchise potential investors who have limited time to decide whether to talk to you further.

N.B. You may have other items you wish to include such as existing customers or investors. You can always add this information, if relevant, at the appropriate points.
What’s the product / service?
Why is it unique / What have you done differently?
Why will customers buy it?
What are the potential problem(s) / issues with it?
How long will the product / service last?

 

Potential Competitors?
Existing products or service
Type of threat
Your advantages / disadvantages

 

Who are you?
Why are you capable of running this business
What are your weaknesses
How are you going to compensate for your weaknesses

 

How much money do you want?
What do I get in exchange for the money?
What are you going to spend the money on?
Will you want more in the future (i.e. will you be diluting me)?

 

What do I get as a return on investment?
When do I get it?
How likely am I to get it?
What do you get?

 

Are you looking at an exit strategy?
When?
How?

 

Appendixes:
Comprehensive Financials; Typically 1yr, 3yr, 5yr forecast
CV’s of founders
Marketing strategy
Client testimonials
Awards won
Any other information

 

 

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