The business plan is a detailed road map to your venture and how you plan to grow it into a successful business. It’s a crucial document for anyone seeking capital, and is typically developed with two audiences in mind: 1) angel investors – wealthy individuals who personally invest their money, expertise and experience in your venture; or 2) venture capitalists (VCs) – partnerships with funds of pooled investment capital with which to invest in a number of companies.
The importance of a well-thought out, comprehensive business plan can’t be overstated. VCs, in particular, review an average of 200 business plans each month. Of the total number of plans submitted, just 0.3 percent ultimately receive VC funding. So to even be considered, your plan needs to be thorough and engaging.
The main elements you should have in your business plan include:
1. Executive Summary
2. Company Description
3. Product or Service
4. Market Analysis and Competition
5. Marketing Plan
6. Management and Organization
7. Financial Projections
8. Fundraising and Use of Funds
Keep in mind that potential investors will judge you not just on your ideas, but also on the way they’re presented. The more time you spend researching your ideas and mapping out your operations, the better off you’ll be. It typically takes several weeks to complete a good, solid plan. You won’t regret the effort because it will also help you to determine how to allocate your resources properly, address problems, and make informed business decisions as you move forward. So take your time and write a thoughtful, comprehensive business plan that will serve you and your investors well as your business progresses.