Should you spend some time developing a business plan for your startup or just dive right in and start figuring things out along the way? This is a question that you will have asked yourself at least once at the beginning of your journey. Business plans are like road maps – it is possible to travel without them, but that will only increase the chances of getting lost along the way or at worst, having an accident. Therefore, they represent small life insurance policies; below you will find out what it is, why it is important, how much it costs, and above all who to contact for the best startup business plan.
What a business plan is
“Having an idea is a great thing. But it’s even better to know how to develop it”
The business plan is the strategic document that summarizes the operational and financial objectives of a company. It’s a company’s roadmap to success with detailed plans and budgets showing how goals will be achieved.
In our opinion, it is the fundamental tool to have on hand because it helps you to introduce yourself to investors, to stay focused while traveling and to keep your short-term and long-term strategic objectives firmly in place.
Confirmation comes from academic research on business planning; in fact, according to a study by Palo Alto Software founder Tim Berry, startuppers who have a business plan are about twice as likely to successfully make their business thrive, attract investors and get loans with respect to those who don’t have one; Furthermore, startups, which prepare a business plan, see a growth of 30% faster than those without and 71% of fast-growing companies have business plans.
When starting your own business, having a strategic plan is the surest way to get started. Even well-thought-out ideas can be completely useless if you don’t have a proper plan.
The importance of the business plan for your Startup
“Vision without execution is just hallucination”
While a business plan is essential for startups, not all entrepreneurs see the need for it. Many are reluctant, but we believe that if you have come this far it is because it is clear to you that even great insights can be useless if you cannot formulate, execute and implement the right execution to make your business idea work. If you are looking to raise money from investors, keep in mind that having a good seed business plan is extremely valuable. So you should aim at having a document that speaks for itself, clear and easy to read and understand.
Below you will find the 10 reasons why it is essential to prepare a business plan:
1. It helps you give shape to your vision
A business plan offers you a means of putting your business vision into writing. It allows you to refine your aspirations and recognize where there are gaps or inconsistencies in what you want to accomplish. It also helps you outline the purpose of your business and give a detailed description of the products and services you will be offering.
2. It helps you better understand the sector, the market and your competition
As you develop your business plan, you will have the opportunity to gain valuable knowledge regarding your sector’s strengths, weaknesses, opportunities and threats; and you will also learn a lot by conducting research on the industry, the market and the competition. Many startuppers make assumptions about these aspects, and research is the only way to validate preconceived notions. A business plan helps you better understand your competition, the market you’re entering, and the customer’s trends and preferences.
3. It allows you to evaluate the feasibility
The data obtained from reports, such as that of CB Insights, clearly tell us that most startups fail: between 75 and 90%. Surely, the founders who started those now-defunct businesses didn’t start with the goal of failure. It’s more likely that they neglected carrying out the planning necessary to evaluate the feasibility of their business ideas and creating a plan able to guide them over time. A business plan will help you do a “reality check” and recognize the warning signs of impending doom. With a precautionary and realistic view, you can make a carefully thought-out decision about whether to move forward, cease and desist or pivot.
4. It gives you a roadmap for starting your business
A business plan is also important because it provides guidance as you work through the many activities involved in starting a business. Writing a business plan forces you to think ahead about important decisions and to set goals you want to aim at.
5. It helps you open your eyes
By capturing your vision in a business plan, you will be able to share it and receive feedback. Seek unbiased advice from trusted professionals, friends, family, and colleagues; this way you will be able to identify problem areas that you may not be able to see on your own.
6. It helps you find talent
Starting a business takes time and there may be activities that require specialized skills or abilities that you don’t personally possess. A business plan will help you identify the resources you need so you can start looking for employees, consultants, or companies with the knowledge and talent you need.
7. It helps you manage your time
Having a complete vision of all the elements involved in starting your business in one document will allow you to decide what needs your attention first and what can wait. A business plan will help you keep track of what you need to do and determine how to allocate time, energy, and resources wisely.
8. It helps you attract investors
A business plan, specifically a seed business plan, is essential to securing financing (such as bank loans or equity loans) or to attracting investors (such as venture capitalists or angel investors). Therefore, we recommend that you provide a well-written document that potential investors can review in order to assess the opportunities and risks of financing your business idea.
9. It helps you manage your business better
Having a business plan allows you to make better decisions because it helps prevent spur-of-the-moment decision-making. It gives you a strategic direction, so fewer results are left to chance. By keeping it updated you will be better equipped to deal with change and make changes so as to stay on the path to success.
10. It helps you in communication
You can use your business plan to communicate your vision and business projections with key stakeholders. Potential lenders, investors, project partners, suppliers, key employees, important customers, etc. can rely on the details in your business plan to assess whether working with you will be the right decision for them to make.
How much a business plan costs
“How much does a business plan cost?” is the question that we hear every day from those who are approaching the startup world, but it is not easy to give a standard price range because each company is different from the others, is in different phases and has very different needs.
The value depends on the type of business idea, its complexity and above all the strategic needs of the startup; however, in principle, a good vertical professional in the sector will ask you for at least 2,000/2,500 euros for the first pool of meetings and document development. This cost can then easily double and/or triple in the case of ideas to be validated via mentoring paths (analysis of customer segments, analysis of buyer personas, analysis of business models, etc.) for business ideas with highly competitive connotations characterized by particularly demanding barriers to entry and/or complex tax profiles.
Remember, however, that in Italy there is a new alternative form of payment, the work for equity form. This method is governed by the law in favor of innovative startups and certified incubators, Law Decree no. 179/2012, art.27 (on the subject see also Revenue Agency circular no. 16/E of June 11; MISE, 2014 “Guide to the use of share plans and of work for equity”) and consists of paying employees and collaborators, as well as external consultancy with market shares or shares of the company.
Examples of business plans
Online you will find hundreds of answers to the question “business plans how to do it” and you can find endless typified canvas business plans that can also be downloaded for free; we have deliberately decided not to follow this path, as, albeit simple and immediate, it leaves the startup relegated to itself without the right guide in the tortuous path of management; as you well know, the inexperience of founders seen in the delicate phase of putting the project into practice (execution) very often leads to failure and our consultancy is aimed precisely at mitigating if not eliminating this risk!
This is why in our opinion, the business plan is the sublimation of a mentorship path, that is, the support of a professional with across-the-board skills who, through the sharing of skills, experiences and knowledge networks, creates synergies and value for your startup, facilitating its birth, funding and above all its growth.
Business plan consultancy with B-PLANNOW®
“It is very easy to be different, but much more difficult to be the best”
The business plan should describe and romanticize why you are the best, it should give substance to dreams, material to visions, structure to innovations. According to us, the business plan is the final result, i.e. the output of the process that led to the creation and identification of the business model, combined with the joint work of corporate identity and brand image. It is a strategic document that accurately and elegantly describes your business project and includes its objectives, strategies, sales, marketing, financial forecasts, etc.
We are convinced that it is the key document that allows you to capture the attention of investors, but also a process that aims at summarizing information, carrying out analyses and assessments. It also has a very strong internal value, to stimulate organization and management to achieve business objectives; today without a complete startup business plan your idea is not taken into consideration by the market.
B-PLANNOW® offers you a service that is unique in its kind with a 5-year (minimum) forecast business plan divided into:
Qualitative (graphic/descriptive) part::
- Short glossary of your startup world
- Executive Summary
The idea, the problem, the solution, the offer, the business areas, the operating context, the market, the reference sector, the strategy, the development plan, financial Highlights
- Company presentation:
The story, the entrepreneur, the team, the objectives, the stages of development, the planned phases, the timing
- Market analysis
Introduction, research methodology, executive summary, Porter’s five forces analysis, analysis of market attractiveness, market overview and main dynamics, PESTEL analysis, SWOT analysis, micro and macro factors affecting the market, mapping of penetration and prospects for growth, global market by category, global market by distribution channel, global market by type, global market by price range, global market by consumer group, global market by region, competitive situations and trends, conclusions
- Business models
The Value Proposition Canvas, customer jobs, difficulties, benefits, products and services, difficulty reducers, benefit generators
The B-PLANNOW BOARD®, WHAT (Offer), WHO (customers/market), HOW (infrastructure), HOW MUCH (Financial structure)
- The business model of your startup
WHAT (Offer), problem, solution, value offered
WHO (customers/market), customer segments, TAM-SAM-SOM analysis, sales channels, customer relations, marketing, corporate identity
HOW (infrastructure), key assets, key activities, key partners, team and company, intellectual property
HOW MUCH (Financial structure), revenue streams, detailed analysis of the sales plan, cost structure, detailed analysis of fixed costs, detailed analysis of variable costs, detailed analysis of fixed assets, agile market development, fundraising
- Your startup in a nutshell
Overview, human resources, advisors, contacts
Quantitative (financial, equity and economic) part
- forecasted balance sheet
- forecasted revenue account
- forecasted cash flow analysis
- current and forecasted analysis by financial statement indices
- analysis of the evolution of the forecasted net financial position
- rating according to the methods of Standard & Poor’s, Altman and Prof. Damodaran
- Medio Credito Centrale rating (access to the SME Guarantee Fund Law 662/96) and bankability
- financial analysis on the sustainability of the investment and on the financial needs
- analysis of the forecasted monthly treasury budget.
Now that you know everything about what it is, why it is important and how much it costs to have a business plan for your startup, all you have to do is contact us, talk to us about your idea and set it up together also in work for equity!