We love what Sequoia Capital says about Business Plan. The original can be found on their web site, but we are pleased to reproduce it below:
We like business plans that present a lot of information in as few words as possible. The following business plan format, within 15–20 slides, is all that’s needed.
Define the company/business in a single declarative sentence.
Describe the pain of the customer (or the customer’s customer).
Outline how the customer addresses the issue today.
Demonstrate your company’s value proposition to make the customer’s life better.
Show where your product physically sits.
Provide use cases.
Set-up the historical evolution of your category.
Define recent trends that make your solution possible.
Identify/profile the customer you cater to.
Calculate the TAM (top down), SAM (bottoms up) and SOM.
List competitive advantages.
Product line-up (form factor, functionality, features, architecture, intellectual property)
Average account size and/or lifetime value
Sales & distribution model
Founders & Management
Board of Directors/Board of Advisors
Serial entrepreneurs are a great source of knowledge for all those who want to create successful and lasting businesses, whether small or large.
And the best thing about it is that their advice is available for free. Take a look at It’s called fishing not catching, a web site maintained by Ben T Smith IV. Ben is an Advisor to, investor in, and founder of technology and media companies.
Enjoy the tips and insight!
Plans are always wrong – everything takes twice as long and costs twice as much. Why is that the case?
- There is not enough slack built into the plan (slack is not acceptable to the management)
- People wanted to win the project in the first place so made unrealistic assumptions (“Are these projects presented to me because they have a positive NPV, or do these projects have a positive NPV because they are presented to me”)?
- Unexpected things happen, incl. stuff that were fully unpredictable (e.g. a Tsunami in Japan)
Plans are inaccurate, but they are not worthless. The value of planning is not so much in the plan itself, but:
- In the communication value: aligning everyone to pull in the same direction
- They help you better understand the opportunities, requirements, dependencies, and risks – plans are a “mental simulation” before the project get started. This helps make the project more successful (or less of a disaster if you did not have a plan).
If you want to improve your plans in a very uncertain environment, the Scenario Planning technique can help.
If not, then read our introductory article about ‘Real’ options.
Happy New Year 2012 to our readers.
Whereas the book ‘Business Planning for Managers’ largely focuses on techniques, including plenty of formulae, maths and number crunching, this web site focuses on the Art of making good business plans. So this time you won’t find a single formula!
Investaura Management Consultants welcomes you to The Art of Business Planning, a web site fully dedicated to the topic of business planning. Our objective is to help entrepreneurs, start-ups as well as managers working with mature companies write better business plans and launch more successful and lasting businesses.
The web site will be updated on a regular basis as our consultants gain additional insight and come across new materials that we want to share with you, in particular videos.
Thank you for your patience!
Enjoy your meal and contact us if you have any comment or question.
Your Investaura Management Consultants