Why You Should Consider Writing A Business Plan For Your Next Startup
Looking back these past few months I can now say that sitting down and writing up my business plan was one of the best decisions I have made. The benefits I have gained as a first time entrepreneur have been numerous and well worth the time and energy needed to write up the business plan. Below I have listed some of the major benefits I gained and I recommend that every entrepreneur consider these before deciding to “wing it”.
The Evolution of Ideas
Ideas change and evolve all the time. In order to plan and execute your ideas, it is critical that they be documented in a structured way. Documenting your ideas in a business plan is a great way to see beyond the idea and to look more towards the business world. The difficulties of market penetration and the strength of the competition is often forgotten when the entrepreneur is focused on their idea and its implementation. The business plan solves this “bias” by forcing the entrepreneur to consider many different areas within the scope of their idea.
A great benefit of writing a business plan is that it helps with brainstorming and developing of the initial idea. While writing the business plan for my content bookmarking site, Bmark, I was able to identify opportunities and develop new pillars to the business simply from the research I conducted.
Help Others Help You
As a first time entrepreneur many aspects of starting a business were foreign to me and I needed to get help from different advisers. Having a well written business plan allowed me to easily explain my business idea to who ever with one email. When needing help on market penetration from a close friend, I simply cut this section from my business plan and emailed it to him to review and comment. Many may worry that others will steal their ideas, but the risk of failing to get off the ground with your startup is so much higher, that preventing those who can help from helping is a bad idea.
Investors Still Want to See a Business Plan
Before an angel or VC gives you a dime for your new startup, they want to see that you have a plan for taking your idea to the market place. Unless you have 100,000 hits a day on your week old website, or some how solved world hunger, most investors want to see a business plan.
After writing my 37 page business plan I was much more prepared to face potential investors who would barrage me with all kinds of questions relating to the market I was entering. Having a thorough business plan which is well organized and edited will show your potential investors that you are serious and willing to put in the time and energy needed to get things done properly.
Every Coach Needs a Book of Plays
As time goes by and your new startup grows, your focus will shift from this cool new idea, to hiring staff, speaking to the media and meeting with lawyers. A business plan will act as a guide for both the founders and the staff, and with keeping the team focused on the companies vision.
I strongly recommend that anyone who is considering starting their own business start the process by writing a well researched, in depth business plan. The time and energy invested will be well worth it and may even save you months of frustration. I have only highlighted some of the benefits I gained from writing my business plan but are interested to hear some others. If writing a business plan helped you develop your idea, tell us about it in a comment below and share it with the rest of our readers.