An Easy Guide to Developing Your Business Plan

A business plan tells potential investors who you are, your professional goals, what you plan to do to achieve those goals, and how that achievement can generate income to be used to pay back the investor and future finance your career. A business plan can help you find financing for your project, help determine when the project will make a profit, and is the map that shows how to get from an idea stage to project completion and profit.

Below you will find many helpful key points to cover and what not to cover in your business plan.

  1. Summary of your project, including the money you need to successfully launch the project and reach your market.
  2. Company description (history, background, and management). Make this short.
  3. Description of your industry and marketplace you are operating within (market size, trends, and competition).
  4. Project budget, financial projections, and statements.
  5. Marketing plan (estimated sales and market share, strategy, pricing, sales card distribution, and publicity and advertising.

Developing A Business Plan

  1. Understand the Audience.
  2. Functions of a Business Plan.
  3. What Do Investors Look For?
  4. Tell A Story.
  5. The Bottom Line.
  6. Topics.
  7. A Business Plan Should Not.
  8. Gaffes to Avoid.

Understand the Audience

  1. Managing Other People’s Money
  2. Pension Funds
  3. Private Individuals
  4. Buried Under Business Plans
  5. 50-100 Per Month or More
  6. Sitting on 10 Boards
  7. Risk Adverse
  8. Managing Time Very Carefully

Functions of a Business Plan

  1. Pique the Investor’s Interest
  2. Open the Door for a Meeting
  3. Provide Clues About Management
  4. Thought Process
  5. Strategic Skills
  6. Realism
  7. Ability to Address Issues
  8. Describe the Opportunity Clearly

What Do Investors Look For?

  1. Strong Management
  2. Relevant Experience
  3. Unique Technology & Products
  4. Proprietary
  5. Strong Market Demand
  6. Defensible Forecast for Served Market
  7. Products that solve real problems
  8. Economic Justification
  9. Competitive Positioning
  10. Sustainable Competitive Advantage

Tell A Story

  1. Start with Executive Summary
  2. Logical, Realistic
  3. Coherent
  4. Quantify, Schedule, Predict
  5. Justify
  6. Estimate Resource Needs
  7. Risks and Strategies

Financial Projections

  1. Pro Forma income statements, balance sheets, and cash flow statements
  2. Capital formation strategy
  3. Determine amount of capital to raise
  4. Appropriate sources of capital
  5. Effective strategy for obtaining financing
  6. Judge financial feasibility of a business opportunity
  7. Provide expert feasibility study
  8. Strategic market research
  9. Business valuation analysis (mergers, acquisitions, and public offerings)

The Bottom Line

ROI = Profit (Revenue, Cost, Expense) divided by Investment (Cash Needs)


  1. Industry/Market Opportunity (Perspective)
  2. Products/Technology (Uniqueness)
  3. Business Strategy/Model (Source of Profits)
  4. Competition/Positioning
  5. Basis for Competitive Advantage


  1. Relevance of Experience
  2. Marketing Strategy
  3. Distribution
  4. Manufacturing
  5. Special Needs

A Business Plan Should Not:

  1. Exaggerate or Overstate
  2. Seek Financial Precision
  3. Underestimate or Ignore Risk
  4. Assume that the Advantages will be Obvious
  5. Be Too Detailed
  6. Be Too Technical
  7. Assume that “Big is Beautiful”

Gaffes to Avoid

  1. “No Competition”
  2. “2% of a $10 Billion Market”
  3. Uninvolved Luminaries
  4. “The Advantages are Obvious”
  5. “ABC VC Firm says they will invest”
  6. Under-estimate Capital Needs
  7. Over-estimate Valuation
  8. “Can you state clearly what your company does?”

There you have it. Most of all remember that it’s Better to be Roughly Right than Precisely Wrong

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