Dr. Steven Gedeon on Business Plan Writing

Dr. Steven Gedeon, PhD, MBA at Ryerson University’s Ted Rogers School of Management has seen both sides of the entrepreneurship game, as an entrepreneur and as a venture capitalist. He brings insights from both worlds to this excellent video interview on business plan writing.

Gedeon has plenty of tips for writing business plans in this video interview. Probably his most important is, “Writing the business plan itself is not nearly as important as the process by which you think through what is a successful business.” In other words:

1. Figure out what your business idea is. Write down clearly and succintly what your business idea is – preferably just one sentence. If you can’t describe it in two sentences or less, it’s not clear in your mind.
2. Figure out who your customers are. Write down in detail who is your customer – or rather, your target demographic – and why they care about your product or service. The more you can focus in on who your customer is, the more you’ll be able to focus your business, your product and your sales.
3. Figure out who your competitors are. Who’s going to compete with you for customers? How are you different from your competitors? Identifying these will reveal opportunities and underserved niches, as well as weaknesses in your competitors.
4. Keep refining and changing. Don’t be afraid to go back to an earlier stage and make changes. That’s the whole point of writing a business plan – to get your business’s details right.

Your concept of your business – idea, customers and competitors – is one of the top three things that venture capitalists look at, according to Gedeon. What are the other two things?

1. Venture capitalists look at your management team. Make sure you assemble as crackerjack a management team as you can. As Gedeon says, “People will bet on the jockey before they’ll bet on the horse. People will bet on an A team with a B plan over an A plan with a B team.”
2. Venture capitalists look at your financials. According to Gedeon, nobody believes the numbers in your financials – your sales and such – and you’re never going to get them right anyway. The trick is to take your best shot at your estimates anyway, and to make it as detailed as possible. This serves two purposes. First, it helps convince your investors that you’ve put some serious thought and research into your company. Second, and probably most important, it serves as a guide to what actions you should take later, when you inevitably don’t fulfill your projections.

This is an excellent video with lots of down-to-earth advice, and we highly recommend it.

Sierra Investment Group Inc. Carson City Nevada is a small business plan writing service and small business funding resource. They can be reached toll-free at (800) 323-6298 from 8 a.m. to 4 p.m., Monday through Friday, or at info@sierraig.com

Advertisements

Tim Berry’s 10 Tips for Reviewing Your Business Plan

So, you have a business plan and your business is up and running. Now you have to find out if your business is staying true to your business plan… or if your business plan needs updating. How do you do that?

Author Tim Berry has 10 tips over at Entrepreneur.com to help you navigate your review. We can sum his suggestions up this way:

1. Go slow and easy. Take it in bite-sized chunks.
2. Gather data. List your assumptions, SWOT and your plan’s inaccurate forecasts.
3. Above all else, collaborate with your employees. Make sure they understand why you’re doing the review, and that it’s not to turn up dirt on them.

This article is really worth your while.

Is Your Business Plan On Track?

Sierra Investment Group Inc. Carson City Nevada is a small business plan writing service and small business funding resource. They can be reached toll-free at (800) 323-6298 from 8 a.m. to 4 p.m., Monday through Friday, or at info@sierraig.com

Dave Lavinsky on Making Your Business Plan More Attractive to Investors

A business plan doesn’t guarantee that you’ll convince investors to take a chance on your company. According to David Lavinsky, president and co-founder of consulting and funding firm Growthink:

… The mindset of most entrepreneurs when completing their business plan is to tell the whole story of their business… While this mindset is helpful in creating a business plan for internal purposes, it generally results in too much information for investors and lenders.

The solution, according to Lavinsky, is to give the customer – that is, your investor – what he wants.

Let’s look at it from the investor and lender standpoint. They don’t need to know every detail about your company. Rather, they simply need to determine whether or not your venture could provide them with an adequate return on investment or ROI.

How do you do that? By realizing that first and foremost, your business plan is a marketing document. That is, your plan must market your company to investors and lenders to get them excited about investing in your company.

IMPORTANT ETHICAL NOTE: Marketing your company doesn’t mean that you lie about your company. It doesn’t mean that you leave out facts that your investor is entitled to know. It does mean that you focus on how your company will benefit your customer – again, your investor. Lavinsky again:

In marketing your company, you don’t give every detail about it, just like deodorant companies don’t discuss every ingredient in their product when marketing it. Rather, you focus more on the benefits.

Let me give you some examples. Rather than going on and on about market trends and statistics, show the data and point out how it benefits your company’s potential success. And rather than talk about all the details of your marketing plan, discuss how your marketing plan makes your company “uniquely qualified to succeed.”

What’s one way to do that? According to Lavinsky:

Another option is to hire a business plan writer to develop your plan for you. While this will cost more money, the writer should be able to save you considerable time in creating your plan. Also, if the writer has experience and a good marketing background, he or she can help position your company to investors and lenders properly in the plan. (Emphasis ours)

How to Write Business Plans For Funding Sources

Sierra Investment Group Inc. Carson City Nevada is a small business plan writing service and small business funding resource. They can be reached toll-free at (800) 323-6298 from 8 a.m. to 4 p.m., Monday through Friday, or at info@sierraig.com

Rob Warlow on the Importance of Proofreading

You should always let someone else – not you, someone else – proofread what you write. After all, says banker and author Rob Warlow, you want to catch those spelling and grammatical errors before you submit your plan to an investor. That first impression is important.

However, there’s another reason to have someone else proofread your business plan, he says.

If you know your business inside and out, you tend to gloss over the details. And so when you’re putting your thoughts on paper, it may not come across particularly well, because you know your business inside out. You know exactly how it works. You know the pitfalls. You know the strengths. Everything is there. You just gloss over the details.

Glossing over the details can kill your business plan’s credibility, says Warlow.

When a third party picks up the plan, they read it, it doesn’t make any sense. There’s bits missing. It’s not joined up in any way. So it’s difficult for a third party to get a sense of what your plan is about.

Your proofreader should read your business plan as if he was a banker, says Warlow. Ask him: Does the plan make sense? Would you invest in the business behind your plan? Your proofreader doesn’t even need any special training.

You don’t need to be a well-trained banker, because a lot of this is all about gut feeling and instinct, and somebody should be able to pick that up from your plan and be able to read it and get that feeling  from it.

Sierra Investment Group Inc. Carson City Nevada is a small business plan writing service and small business funding resource. They can be reached toll-free at (800) 323-6298 from 8 a.m. to 4 p.m., Monday through Friday, or at info@sierraig.com

Entrepreneur Magazine’s Five Questions Your Business Plan Must Answer

We’ve told you what not to put in your business plan. Isn’t it high time we told you what must be put in your business plan?

Gwen Moran at Entrepreneur’s StartUps has a few thoughts on the answers your business plan must answer. Surprisingly, not all of those answers revolve around money. They also include how you’ll win market share, who will run your company and why you’re spending so much energy – and why you want investors to spend so much money – on your company.

Keep these questions in mind when gathering information for your business plan. Answering them will help make your plan a winner.

Five Questions Your Business Plan Must Answer

Sierra Investment Group Inc. Carson City Nevada is a small business plan writing service and small business funding resource. They can be reached toll-free at (800) 323-6298 from 8 a.m. to 4 p.m., Monday through Friday, or at info@sierraig.com

“Why Should You Waste Your Time Writing a Business Plan?”

Dr. Steven Gedeon, PhD, MBA, venture capitalist and entrepreneur, cuts right to the chase in this video from StartMeUp Ryerson: “Why should you waste your time writing a business plan?” It’s an excellent question, since you’ll need six months to a year to write your business plan.

One answer, according to Gedeon, is that you probably won’t attract investors to your business if you don’t have a business plan to show them. No investors can equal no business or reduced expectations.

However, there’s another important reason for writing a business plan, according to Gedeon: “I find writing to be a guide to thinking, so one reason for writing a business plan is because it forces you to subject the thoughts that you have to the real world.”

In other words, he continues, things always make perfect sense in your own head – your business, who your customers are, why they’ll buy from you, the ways you’ll handle risk, and so on. Writing those thoughts down forces you to spot and clear up inconsistencies in your thinking.

In addition, a business plan can be a “roadmap” to the assumptions that you made when you started your business, says Gedeon. That way, when things go wrong – and they always will – you can go back to your business plan, see how your assumptions differed from reality and make adjustments.

“So the big reason for doing a business plan is it gives you the opportunity to say ah! because this changed I need to change something else,” he says.

Sierra Investment Group Inc. Carson City Nevada is a small business plan writing service and small business funding resource. They can be reached toll-free at (800) 323-6298 from 8 a.m. to 4 p.m., Monday through Friday, or at info@sierraig.com

Tim Berry’s 3 Tips for Dealing with Uncertainty in Your Business Plan

Let’s face it, you won’t be able to predict the future when you write a business plan with perfect accuracy, especially those all-important sales figures. That goes double if you’re writing a business plan for a new business. That much uncertainty is intimidating. It’s even scared would-be entrepreneurs away from starting their own businesses.

Author Tim Berry has some great tips for managing your uncertainty about uncertainty over at American Express’ OPEN Forum:

1. Break what you don’t know into manageable chunks. Base your projections on what you do know.
2. Instead of focusing on unknowns, focus on goals and how you’ll track your progress toward them.
3. Embrace uncertainty. You’re never going to know everything, so don’t sweat it so much.

As Berry writes, “I’m not advocating running and jumping in willy-nilly; but when you think of it, nobody knows the future. That security you get in the status quo is a lot like the safety an ostrich feels with its head stuck in the sand.” You probably agree… or you wouldn’t be starting your own business, now would you?

3 Ways To Reconcile Business Plans With Uncertainty

Sierra Investment Group Inc. Carson City Nevada is a small business plan writing service and small business funding resource. They can be reached toll-free at (800) 323-6298 from 8 a.m. to 4 p.m., Monday through Friday, or at info@sierraig.com

Inc. Magazine’s 10 Biggest Business Plan Mistakes

John W. Taylor and Inc. Magazine

We’ve told you what you should do when writing a business plan. Just as important, though, is knowing what you shouldn’t do. Inc. magazine picked the brain of consultant Akira Hirai and produced a slide show of the 10 things you absolutely, positively must avoid when writing your business plan.

Top 10 Mistakes Entrepreneurs Make When Writing a Business Plan

Sierra Investment Group Inc. Carson City Nevada is a small business plan writing service and small business funding resource. They can be reached toll-free at (800) 323-6298 from 8 a.m. to 4 p.m., Monday through Friday, or at info@sierraig.com

Assad Hamzeh on How Your Business Plan Can Help You Pitch to Investors

Assad Hamzeh is the founder and CEO of Sharakeh, a Jordanian company that connects companies to investors. He’s seen plenty of entrepreneurs pitch their ideas. Unfortunately, he’s also seen plenty of those pitches fail to gain any funding.

One of the main reasons these pitches never hit their mark, according to his recent article on Wamda.com, is doubt.

Entrepreneurs and investors here tend to the look at the project from two very different angles. Entrepreneurs tend to be emotionally attached to their projects, and want to protect them from being taken advantage of. Investors tend to look at projects as risky ventures that could threaten their assets. If there are no formal shields in place to guard against the potential risks, they will not invest.

Doubt can be a healthy factor driving negotiations.  But when one or both sides walk out on a lucrative business opportunity due to unrealistic fears, it’s unproductive…

He has five tips to reduce both your and your investors’ doubt, as well as increase the success rate of your pitches. What’s tip no. 1?

1. Create a good business plan summary.
Even if your business model is great, it won’t matter if the investor cannot easily understand it. Often when entrepreneurs come to pitch to me, I read business plans that are too short and incomplete, or too long and too technical.

An ideal business plan write-up should be 10-15 pages long, and should have an executive summary that explains the concept in one to two pages. Investors don’t want to read 80 pages of details to understand if they like the idea or not. Give them just enough material to get interested, so that your summary is a good foot in the door to future discussions.

This artice is intended for businesses operating in Jordan. However, you’ll want to read it no matter where your business is based or where it operates.

h/t to Endeavor Global, Inc.

Sharakeh Shares 5 Tips for Pitching to Angel Investors

Sierra Investment Group Inc. Carson City Nevada is a small business plan writing service and small business funding resource. They can be reached toll-free at (800) 323-6298 from 8 a.m. to 4 p.m., Monday through Friday, or at info@sierraig.com

Entrepreneur’s Business Plan Primer for Newbies

So, you still don’t know what a business plan is or if you need one, huh? What you need is a good business plan primer. Lucky for you, we recently ran across one.

Entrepreneur.com‘s “An Introduction to Business Plans” has short-but-sweet descriptions of what business plans are, how long and involved they should be and even who should have them:

About the only person who doesn’t need a business plan is one who’s not going into business. You don’t need a plan to start a hobby or to moonlight from your regular job. But anybody beginning or extending a venture that will consume significant resources of money, energy or time, and that is expected to return a profit, should take the time to draft some kind of plan.

This article won’t hold your hand as you write your first business plan. However, it will help you overcome your fears about writing your plan and get you pointed in the right direction.

An Introduction to Business Plans

Sierra Investment Group Inc. Carson City Nevada is a small business plan writing service and small business funding resource. They can be reached toll-free at (800) 323-6298 from 8 a.m. to 4 p.m., Monday through Friday, or at info@sierraig.com