Last week I reported on Day 1 of High Tech Rochester’s Business Plan Workshops. This week’s session (Day 2) covered two different areas – Funding Your Business (The Financials Section) and Communicating Your Business Plan. The following are some highlighted points that I walked away with:
- This section of a business plan seems to me to be one of the most daunting, mainly because it can be difficult to tell the story of your business all in numbers, but it is obviously an essential part of the plan, as investors will want to know how your business can make them money. It also helps you as the business owner to know where you are heading. Many people are not familiar with the financial models that investors look for, and it’s OK if you aren’t, but you should make sure to get HELP when developing this portion of your business plan.
- The financials should show up in three places in a business plan: A brief statement in the executive summary, in the 1-5 page financial section (the meat), and the details should appear in an appendix. It is important that the numbers in all three of these sections are consistent with the narrative explaining your business plan.
- One of the most difficult portions of the financial section are the cash flow projections, especially for small startups that may not have the actual numbers yet to back up projections. The key to providing successful projections and still maintaining credibility is to defend them in your narrative. Laying out exactly what you’ll do to achieve those projections will go far with judges and investors, as will providing other kinds of “hard evidence”, such as current customer feedback responses.
Communicating Your Business Plan
- This portion of the workshop briefly discussed the major components of a business plan, as well as some key points of advice relating to the verbal pitch of a plan to judges or investors. The writing and presenting of the plan will be covered more in detail at the next workshop.
- It’s been stressed that there is no single “right” outline when it comes to writing a business plan. That being said, there are many useful software programs out there that provide an outline and help walk you through each component, and there is a great general template that you can access for free from Score.org, a small business mentoring website.
- One of the most important documents in your business plan is the executive summary. It’s required as an initial entry document by a large majority of business plan competitions taking place, and it is your “selling document” when presenting to investors. Most experts will suggest that you write this summary last, as it should contain all of the most important information relating to your business. It should also be concise, taking up no more than 5 pages of your business plan, which can present a challenge. Most importantly, your executive summary should leave a clear impression of that your business does, what your goals are for the business, and how you plan to achieve them. Get right to the point!
- The verbal pitch should be a simplified version of the executive summary. In most cases, you’ll be using a visual, such as a complementary powerpoint presentation. Graphs and tables work better than words when displaying your company information, and the presentation should be fairly simple to grasp – stay away from getting overly technical. This article by the Wall Street Journal has some helpful tips on pitching your plan, and this blog post by investor/entrepreneur Brad Feld discusses the importance of showing how your business or product works, instead of just talking about how it will make money.
This week’s workshop promises to be another info-packed session all about the specifics of writing a business plan, so stay tuned!View all posts by Megan Hurley → This entry was posted in Featured Posts and tagged featured. Bookmark the permalink.