How to Make Your Business Plan Stand Out

Venture capitalists receive hundreds of business plans every month. The key to making your business plan stand out is to write a strong and compelling executive summary - which is, in some ways, even more important than the business plan itself. Here are some tips for making your plan stand out.

Instructions

Difficulty: Challenging

Things You’ll Need:

• Financial Calculator
• Personal Organizers
• Microsoft Office
• Business Plan Software

1. Keep it brief. Your executive summary should be no more than two typed pages or 10 slides of a PowerPoint presentation.
2. Pitch your business. In the first section of your executive summary, explain in 15 seconds (or one to three sentences) why your business concept is compelling and how it is going to be successful.
3. Define your venture's business model. Detail how you will generate revenue.
4. Explain your sales model. Summarize and discuss briefly how you plan to capture customers and support your business model to generate growth. Describe direct sales, channel partners and strategies.
5. Detail your marketing plan. Discuss how you plan to pitch your business to partners and customers. Describe what marketing channels and strategies you plan to adopt.
6. Identify the overall size of your market and the addressable market subset that you are targeting.
7. Identify what granular aspects of your business drive growth and capture revenue.
8. Conduct a bottom-up analysis by identifying how many customers and how much revenue you will capture each month.
9. Supply key assumption figures. Investors will want to know your best estimates about current customers, future customers, the cost of customer acquisition over time (both now and a year from now), the average sales price of your product or service, the gross margin and the net margin of your product or service, and expected revenue over the next 12 months.
10. Detail your 12-month cash flow projection. This analysis should include several things. First, include an assessment of how far the cash you are soliciting will take you. A venture investor wants to know how far the current round of capital will take the company and what key milestones will be achieved. Next, detail your cash requirements for the next 12 months. Explain how much cash your company will need before it generates a positive cash flow and requires additional equity financing. In a competitive marketplace, this can often be a significant amount of capital. You should have an idea of how much capital it will take to "win" and become a self-sustaining, cash-generating company.

Tips & Warnings

• For easy reading, list your points in bulleted form.
• Make your executive summary brief and clear. These are trademarks of a well-thought-out plan.
• Don't assume venture investors will read your entire business plan before they first meet you. They often don't. If you have key information embedded in your plan, make sure it is articulated in your summary.