Guidelines

No matter which type of funding you decide to go for - bank loan, venture capital, or money from a ”business angel” (nickname for wealthy individuals that will back your business when no one else will) - you’ll need to have a well-written Business Plan.

There are only three potential sources of money for people who refuse to write a BP. In the international financial community those sources are referred to as the Three F’s - Family, Friends and Fools.
But if you don’t have rich friends or relatives - and no fools can be found - then writing a BP becomes a necessity.

The extra effort and time spent putting it all down on paper will be saved when it comes time to ask for money. After all, an extra hour spent writing is better than an extra hour of a lender rattling off a million reasons not to give you money.

Writing a Business Plan is hard work which requires certain rules to be followed. Here you can find the ultimate knowledge of this rules.

What to do:

1. Make BP attractive. At the same time your BP should appear business-like. Enclose it in a dark-colored binder or folder. Don’t save money by cramming too much on one page. Make the margins generous and use at least 12 point font size.

2. It’s important to be clear and concise. Make it easy to understand.

3. Be realistic. It is easy to get excited about your idea. That’s good. But it’s easy to exaggerate the probability of success.

4. It’s important to pay careful attention to your distribution channels. How your product reaches the market is undoubtedly one of the most important aspects of your BP.

5. When discussing competitors, don’t just list them. It is critical that you analyze the competitive territory. What are the strategies of your competitors and their core competencies? Why do customers buy from them? How good is their sales and support organization? What is their financial situation? What are their weakness and can you benefit from them?

6. Your BP must give a clear understanding to the main question of a lender ”Is there a need for what are you doing, and how would you compete against the established companies in that space?”

7. Your BP must clearly outline your tactics of a loan re-payment. Put yourself in a lender’s shoes for a moment. If he gives you a loan, what’s the best thing that can happen for him? He gets hos money returned to him, plus an interest. So his primary concern - and yours - is how you intend to repay a loan.

8. Don’t forget to cover all the basics: your key messages, your business model, pricing and packaging, channels of distribution.

9. Think of one highly compelling sentence that clearly communicates your business’s value proposition (something like the famous Nokia’s slogan ”Nokia Connecting People”). Not only this sentence provide an effective lead for your Executive Summary, it will also serve as a key selling point as you move forward in the fund-raising process.

10. Do all the research. A BP is an all-or-nothing project. You can’t just do it half-way and expect it to work.