How to build a solid business plan for your startup or business by a Techstars COO
There are a ton of things you want to include when you are looking to build out a business plan. Whether you are looking to go and raise a pre-seed fund from venture capital people, or you are looking to bootstrap a company here is a guide on starting a business plan from scratch. The same rules apply to any business you are trying to start whether its a youtube channel, a blog, a restaurant, or a technology company.
- Have a vision ready
Think macro about what sector and area you have an interest in. Are you good at something or do you have connections in something? Is there a specific niche you are looking to focus on or a problem you think can be solved? This is the best way about focusing on a particular idea. If you are youtube creator looking to increase subscribers maybe think about the topic you're trying to exploit and build content around that.
2. Evaluating your specific ideas
Look carefully and try to evaluate your ideas and how you can evaluate them. Without building anything maybe do some market research on customers. If its for example an eCommerce platform for restaurants like Chefr maybe go and talk to restaurants to validate your idea that restaurants can see a solution and need to solution to your product. There are a ton of ways to prove that there is a market before you go out before you build out your technology.
3. Why are you building a business plan?
Think carefully about the business plan you are trying to create. Who are you trying to create the business plan for? An investor? You will have to gear your business plan clearly according to what you are trying to build.
4. Study competition carefully
While building a business like Postr, Pompfuel (techstars) or others we had to carefully study the competition before entering the space. Its important to see what they are doing and what they are not doing. While building Europe's first fuel-on-demand company we carefully studied the USA competitor, Booster fuels, how they were operating, and how we could be more effective.
5. Steps in creating a business plan (which are laid out for you below):
- Draft an executive summary
Solid executive summaries are one of the most important things in business plans and will give readers an idea of what you are tyring to build. Dont be exceding on a4 page and make sure it includes the following:
- A solid business idea and concept laid out
Make sure you have your business idea clearly idea about and focus on what exactly the business does
- Business goals
Wbat is the aim of your project?
- Your target market
Who are you going after? What does your problem solve?
- How are you going to market your product?
What is your marketing strategy to acquire users. (not just blowing money on ads) but what else can you do to acquire customers?
- How are you going to finance your product?
Self-funded or do you have investors to fund your project? Clearly lay this out
- How much money are you asking for (if your doing it for yourself you dont need this)
If your doing the business plan for yourself you dont need to do this, if not clearly state the ask. A great resource on preparing the pitch deck is below from YC.
- Any team members?
Who is on your team. State the team members and background. Potential investors will want to know how you guys know each other. The most common reason for busiens failure is a disagreement internally so be ready to answer these questions.
- Perform a market analysis
So important before you go into any business is to look at the overall market itself and what the competitors are doing. If its a fuel-on-demand company it would, for example, be good to look at the oil price, and where you think its going and whether the European market needs a fuel demand market. This would be done by going to speak to companies like for example UPS about whether their vehicles need such a service and do some market research.
Reach out to me for any further thoughts!