If you missed the terrific presentation by Melissa Krinzman and Darius Nevin at the Miami Herald Business Plan Bootcamp, I'll fill you in on some of the key takeaways.
Melissa is managing director of Venture Architects and has worked with hundreds of companies with capital-raising, so she knows what investors want. They want to know if the company solving a critical problem. Does the team have the ability to execute? Will there be profits? Your goal in your business plan is to give them that, she says.
If you are entering the Business Plan Challenge, you have just three pages (plus one bonus supplemental page for a visual or chart) to tell your story. Melissa, who has been a Business Plan Challenge judge for a number of years, says the key is to make every word count. Active verbs and bulleted items are your friend.
She suggests concentrating on the following areas:
Problem/solution -- What problem are you solving and how big is the market opportunity?
Company overview -- What do you do? If your company is already operating (ideas are fine in the Business Plan Challenge), where are you in time and what milestones have you reached?
Product or service description -- You're proud of your product and the tendency is to write a lot here, but be brief, she says.
Competitive landscape -- List competition and how you differentiate yourself.
Sales & marketing Strategy -- Include any successes to date
Growth strategy -- An area often not included in plans, but it should be. How have you prioritized growth initiative and what is your timeframe? Put costs to each growth phase if possible.
Management team -- This is very important. Include your relative skills and those of key team members.
Financial summary & projections --
We devoted a whole section to financials, because we see that often missing from plans. Darius Nevin, an investor and co-founder of G3 Capital Partners and also a Challenge judge this year, gave the presentation.
It may be cliche, he said, but numbers are the language of business, so you might as well learn how to put together a spreadsheet. He walked people through the process, because when you seek funding investors absolutely will be looking for this information.
In your financial summary, he suggested including current financing, revenue streams, financing requirements and use of proceeds.
Items to include in the financial projections include launch costs, revenue assumptions and build; direct costs; sales & marketing; general & administrative; operating income or cash flow; capital expenditures, he says.
He suggests that he likes to see an operating income statement broken down monthly for first 12 months and annual thereafter for 3-5 years, and he gave examples of different possible formats for different types of businesses.
This section may seem daunting, but what the judges really want to see is that you put thought into this section. Are you able to explain in numbers the story of your company?
Check out the next Business Monday for more on this topic.
Here is a previous story on business plans.