Business Plan & Pitchesthe Fundamentals
Marc Diaz & Eric MathewsMercury Technology Labs
www.mercurytechlabs.com
purpose:
to discuss the importance of business plans & pitches,
what they should include and how to deliver them with the
greatest impact
Upcoming EventsMarch 5-7 48Hour launch (LaunchMemphis.com)
March 18 FastTrac (TECWorks.org) April 3 Business Plan Bootcamp - the Bootstrapping Version (LaunchMemphis.com)
April 8 Baker Donelson Boot Camp In Depth Legal, HR, Accounting
Why Bother?
"Business plans don't get funded, investors fund visionary entrepreneurs"
"Investors don't even read business plans"
"Our product is too great - we don't need to write a business plan - just show it to them"
Use of Business Plan
• It's the Planning, not the Plan• Operating tool - roadmap• It lives and breathes - revisit and update
every six months• Communicate your opportunity to others• Hire the management team• Secure financing for the business• Cannot outsource!!!
Business Plan
Elements
• Executive summary • Management and organization• Product and service plan• Marketing plan• Financial plan• Growth plan• Appendix
Executive Summary
• Description of venture• Market• Money needs• Financing• History/Background
Executive Summary
Pitfalls• Failure to identify different or unique features• Providing too much superficial data• Using long sentences and phrases• Failure to specify management goals• Failure to identify money needs,
how funds will be obtained & spent• Trick !!
Management and Organization
• Management Teamo Who will be the "business" gal? o Who will be the sales guy?
• Board of Directors/Advisors• Infrastructure • Organizational Chart
Management and Organization
Pitfalls:• Not making a case for the Management Team• Leaving out the Board of Directors• Forgetting about your infrastructure:
o Lawyers, accountants, bankerso Marketing consultantso Advertising/public relations agencieso Governmental agencieso Business consultants
Product / Service
• What does it do? • Unique features • Stages of development • Future research and development • Patents, trademarks, copyrights, • licenses, royalties
Product / Service
Pitfalls:• Failure to do your research
o "Oh isn't that what xyz does? How are you different?"
• Failure to find your niche• Forgetting to protect your workTrick: Pitch to someone and have them repeat back to you
Market Analysis
• Industry Overview• Trends• Competition Profile• Target Market• Customer Profile
o Who in the company will buy from you?• Marketing Strategy• What is a sales call like?
Market Analysis
Pitfalls• Failure to do your research• Assuming you know your customer• Assuming you know your competition• Thinking everyone is a potential customer• No competition • Approaching marketing haphazardly
Don't underestimate marketing!!
Market Research Sources
• Library• Government agencies• Trade associations• Trade conventions • Magazines• Computer searches• Competitors• Competitor's customers• Suppliers
Target Marketing
• Identify potential target markets• Size of target markets: customers and
dollar volume• Prioritize target markets• Cost of penetration• THINK LIKE THE CUSTOMER!
Pricing and Profitability Analysis
It's true - it's always MORE • Pricing• Start-up Costs• Income Projections• Break-Even Analysis
Pricing and Profitability Analysis
Pitfalls• Not understanding your costs• Undervaluing your time• Being unrealistic with your sales
projections• Ignoring sales cycles• Starting the business with insufficient cash
reserve
Growth Plan
• New offerings to market• Capital requirements• Personnel requirements• Scaling metrics • Exit strategy
Format and Writing tips
• 35-65 pages• Cover page• Table of contents• Use subtitles• Use page numbers • Use charts, graphs, and bullets• Check math• Check spelling• Support documents in appendix
Appendix• Detailed descriptions of high-tech products• Resumes of management team• Patent, trademark, and copyright documents• Business agreements, employee contracts,
stock option plans• Product and service brochures and
advertising samples
Appendix
• Company logos• Reference letters, recommendations,
endorsements or testimonials• Research documentation• Product and location photos• Operating and control systems• Customers’ letters of intent
Pitching
• Time for Making a Pitch• Full versus Complete• Living Artifact• Compelling and Clear
MercuryTechLabs.com/blog has detailed notes.
4 Parts of the Pitch
1) Context
2) Soluton
3) Business Model
4) Ask
Part 1: Context
Point 1: What is the Company and its Core Value?
Point 2: What is the Pain/Problem that you seek to solve?
Point 3: How Big is the Pain/Problem?
Part 2: Solution
Point 4: What is Your Solution?
Point 5: What is the Benefit(s) or Value that your Solution provides?
Point 6: Who else provides a solution and why is yours better?
Part 3: Business ModelPoint 7: How will you get your solution to the Market?
Point 8: If you can get your solution to market, how will you make money?
Point 9: Assuming you can get it to market & make money, how much will you make?
Part 4: Ask
Point 10: What will be needed to succeed and how will you and others measure progress?
Point 11: Why you? Why now?
Building Toward the AskSlide 1: (Title Slide) What is your company and its core value?Slide 2: What is the Pain/Problem that you seek to solve?Slide 3: How big is the pain/problem?Slide 4: What is your solution?Slide 5: What are the benefits that your solution provides?Slide 6: Who else provides a solution ad why is yours better?Slide 7: How will you get to market?Slide 8: How will you make money?Slide 9: How much money will you make?Slide 10: What do you need to succeed? How will it be measured?Slide 11: Why you? Why now?