When entrepreneurs realize that they need capital to launch or grow their businesses, typically they also realize that they need a business plan. The first question that often comes to their minds is how to write a business plan. Too many times, the entrepreneur sets out to jot down every detail of their vision on a piece of paper. However, this is not how to write a business plan. Rather, the foundation of the plan needs to be based in marketing strategy. It is always critical to realize that a business plan is sales document that seeks to sell equity in your company, or, in a loan, sell the fact that the venture will be able to repay its debts. Similarly to any other product that you might sell, in developing a plan it is critical to have a marketing strategy in place. You need to understand who your customers are, what they want, and how to give it to them. Customers in the business plan world are typically angel investors, venture capital firms, private equity firms and banks. Each of these customers typically has different needs, and even customers within each genre have different values and tastes. For instance, some venture capital firms are only interested in certain sectors, while others are only interested in ventures which can potentially provide a 10X return on investment. As such, not only must entrepreneurs understand investor needs, but they must cater to them by positioning their business opportunities appropriately. This includes the tailoring the overall positioning of the company, detailing why the investment is right for the specific investor and creating a business plan document that meets the formatting tastes of the investor. Before spending the time questioning how to write a business plan, entrepreneurs should consult with professionals who understand the market and the needs of customers. Without this knowledge, it is impossible to write a winning plan. |
