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CHAPTER 6
WRITING A BUSINESS PLAN
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arrangements should be made prior to the meeting. The presentation should
consist of plain talk and should avoid technical jargon. Start-up entrepreneurs
may mistakenly spend too much time talking about the technology that will
go into a new product or service and not enough time talking about the busi-
ness itself. The most important issues to cover in the presentation and how to
present them are shown in Table 6.5. This presentation format calls for the use
of 12 slides. A common mistake entrepreneurs make is to prepare too many
slides and then try to rush through them during a 20-minute presentation.
TABLE 6.5 Twelve PowerPoint Slides to Include in an Investor
Presentation
Topic
Explanation
1. Title slide
2. Problem
Introduce the presentation with your company's name, the names of
the founders, and the company logo if available.
Briefly state the problem to be solved or the need to be filled.
Explain how your firm will solve the problem or how it will satisfy the
need to be filled.
3. Solution
4. Opportunity and
target market
Articulate your specific target market. Talk about business and
environmental trends that are providing your target market
momentum.
5. Technology
This slide is optional but is normally included. Talk about your
technology or any unusual aspects of your product or service. Don't
talk in an overly technical manner. Make your descriptions easy to
understand and interesting.
Explain specifically the firm's competitive advantage in the
marketplace and how it will compete against more established
competitors.
6. Competition
7. Marketing and sales Describe your overall marketing strategy. Talk about your sales
process. If you've conducted primary research regarding how people
feel about your product, report the results here.
8. Management team Describe your existing management team. Explain how the team
came together and how their backgrounds and expertise are keys to
the success of your firm. If you have a board of advisors or board of
directors, briefly mention the key individuals involved. If you have gaps
in your team, explain how and when they will be filled.
9. Financial projections Briefly discuss the financials. Stress when the firm will achieve
profitability, how much capital it will take to get there, and when its
cash flow will break even. Use additional slides if needed to properly
display your information, but don't go overboard.
10. Current status Describe the current status of your firm in the context of the
milestones you've achieved to date. Don't diminish the value of your
accomplishments.
11. Financing sought
Lay out specifically how much financing you're seeking and how you'll
use the money
12. Summary
Bring the presentation to a close. Summarize the strongest points of
your venture and your team. Solicit feedback from your audience.
Source: B. Barringer, Preparing Effective Business Plans: An Entrepreneurial Approach, 2nd Edition, © 2015,
247-259. Adapted by permission of Pearson Education, Inc., Upper Saddle River, NJ.
206
1
PART 2
DEVELOPING SUCCESSFUL BUSINESS IDEAS
sticking to its original business plan? Which company
do you think will have the hardest time? Explain your
selections.
3. Why do you think some start-ups find it difficult to
change their business plan, even when presented with
evidence that their current business plan isn't working?
4. Look at the "You Be the VC" features at the end of
Chapter 5, which focus on Prynt and ZUTA Labs, and
the "You Be the VC" features at the end of this chapter,
which focus on Beyond Meat and Ava. From the infor-
mation in the features and on each company's website,
which company do you think will have the easiest time
Sources: Songkick Homepage, www.songkick.com (accessed
February 21, 2017); GrubHub Homepage, www.grubhub.com,
(accessed February 21, 2017); Instagram Homepage, https://
instagram (accessed February 21, 2017); B. Barringer and R. D.
Ireland, Entrepreneurship: Successfully Launching New Ventures
5th edition (Upper Saddle River, NJ: Pearson, 2016).
plan on a section-by-section basis. The topics should be presented in the same
order as they appear in the business plan. Two identical versions of the execu-
tive summary should be prepared-one that is part of the business plan and one
that is a stand-alone document. The stand-alone document should be used to
accommodate people who ask to see the executive summary before they decide
whether they want to see the full plan.
Even though the executive summary appears at the beginning of the busi-
ness plan, it should be written last. The plan itself will evolve as it is written,
TABLE 6.2 Business Plan Outline
Cover Page
Table of Contents
1. Executive Summary
II. Industry Analysis
Industry Size, Growth Rate, and Sales Projections
Industry Structure
Nature of Participants
Key Success Factors
Industry Trends
Long-Term Prospects
III. Company Description
Company History
Mission Statement
Products and Services
Current Status
Legal Status and Ownership
Key Partnerships (if any)
IV. Market Analysis
Market Segmentation and Target Market Selection
Buyer Behavior
Competitor Analysis
Estimates of Annual Sales and Market Share
V. The Economics of the Business
Revenue Drivers and Profit Margins
Fixed and Variable Costs
Operating Leverage and Its Implications
Start-up Costs
Break-Even Chart and Calculation
VI. Marketing Plan
Overall Marketing Strategy
Product, Price, Promotions, and Distribution
Sales Process (or Cycle)
Sales Tactics
VII. Design and Development Plan
Development Status and Tasks
Challenges and Risks
Projected Development Costs
Proprietary Issues (Patents, Trademarks, Copyrights,
Licenses, Brand Namės)
VIII. Operations Plan
General Approach to Operations
Business Location
Facilities and Equipment
IX. Management Team and Company Structure
Management Team (Including a Skills Profile)
Board of Directors
Board of Advisors
Company Structure
X. Overall Schedule
XI. Financial Projections
Sources and Uses of Funds Statement
Assumptions Sheet
Pro Forma Income Statements
Pro Forma Balance Sheets
Pro Forma Cash Flows
Ratio Analysis
Appendices