Machala ferrel - Business Plan
Post on 23-Jan-2015
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The Business Plan
Janis Machala, Paladin PartnersDon Ferrel, SeaTec
Cofounders of BigScreen
About Us
Janis• Managing Partner,
Paladin Partners• Serial entrepreneur,
business advisory services
• Wang, Sun, Microsoft, IT Start-ups
• BA Psychology, MBA, University of Iowa
Don• President/CEO, SeaTec
Consulting• Serial entrepreneur,
business development, large scale IT systems integration
• Scitor, Rockwell International
• BA Math, BS Physics, Washington State
Long time active player in West Coast venture and angel scenes
NWEN, Alliance of Angels, Seraph Done lots of deals
Strong technical acumen Excellent execution and
team building skills Fiscally conservative
About Our Company - BigScreen Simplified computing and
Internet for older adults
Extends social and care-giving networks
Trusted source for value-added services
Purpose of a Business Plan
Alignment of team(s) Operating plan Communication across company,
division, department, business partners
Investment capital Expansion capital (banks, leases) Merger/acquisition process
How to Use a Business Plan Executive summary
Solicit interest Screen for investor candidates
Mini business plan Banking/leasing document Potential acquirers
Full business plan Team planning process Due diligence
What Investors Look For
How does the team think? How detail oriented is the team? How big is this market? Is there sustainable competitive
advantage? What’s the growth plan? What does the technology roadmap
look like, short term or long term play
Financial Projections
Build 5 years Detail near years, extrapolate out
years Build from single unit economics Document assumptions Compare against top down Validate with market comparables
10 Must Answer Questions How large is your addressable market? How fast is the market growing? Who’s make up your management team? What’s your “secret sauce?” What are the barriers to entry/competitive
advantage? What do your 5 year financials look like? What’s your path to profitability? Why is this a company versus a product/service? Who’s your competition and how do you beat them? Why can’t Microsoft do this? (or name any big,
established company…)
Creating Your Company’s Strategy
Building a strategy is harder work than building your product
Think about What do you want your business to be
when it grows up Looking back from 5 years in future Perspectives of all stakeholders Anything that could go wrong
Hope is not a strategy
Competitive Analysis
You always have competitors Dig deep, be detailed, be honest Compare features and benefits Technology comparison Whole product offering (pricing,
support, etc.) Channels, funding, customers…
Sustainable Competitive Advantage
Create barriers to entry Continually add value for your
customers (and your investors) Anticipate competition and make
plans for dealing with it Better widget, price erosion, market
share, different business model….. Avoid the trap of believing that your
main competitor is your exit strategy
Business Plan Format Pages: 10 to 30 Kinko’s white bond
is good enough Simple binding Examples
Handout – a good example B Plan
Discuss examples of bad ones
Typical OutlineExecutive SummaryIntroduction and Business PremiseMarket Analysis and Customer NeedsProduct OverviewValue PropositionBusiness ModelBusiness Operations PlanMarketing and SalesMarket EntryTransition to Revenue ServiceCompetitive AssessmentPartnership StrategyManagement Team and AdvisorsFinancial ProjectionsKey Business MetricsCapital Structure/Financing PlansExit StrategyRisk AnalysisSummary
User Friendly B-Plan is Key Investors receive hundreds of these Most plans don’t get fully read Reasons why:
Logic is difficult to follow The business is not obvious Too much extraneous information or fluff
Use the same techniques to write your plan that you would use to write a play, a song, software…..
Nuts and Bolts 12 point type Use a clean font Don’t use bold or italics too much Make sure your visuals are readable No typos, proof-read thoroughly (including
the visual!) Remember: not everyone has same printer Check for grammar Style consistency If you can’t write, hire someone
Due Diligence
Market assessment is initial focus Customer market validation next Team references and resumes critical Secondary:
Financials and assumptions Corporate structure and legal docs Patent applications
Resources Reading list
Guy Kawasaki Geoffrey Moore Business 2.0 HBS Case Studies
Workshops CIE Program NWEN WTC SBA
Archive Venture blogs Kauffman
Foundation
Consultants Domain experts Funding experts Teambuilding
experts
Questions and Discussion
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