A business plan isn’t just a tool for wooing investors, says Jason Kennedy, marketing director at Early Growth Financial Services. It’s also the roadmap for guiding you through the rugged terrain every new company must cross.
Kennedy, who started out in tech, worked in 3D modeling, and spent time in the music industry, defines a business plan as “your company’s story in numbers.” With experience project managing, researching, analyzing, and marketing, he shares three tips on creating a business plan that investors will love.
Make your timeline clear. Make it clear to potential investors what you’re after. What are you looking to achieve over the next two or three years? “Cap the timeframe at three years because it’s hard to predict beyond a couple of years, especially if you’re a startup seeking funding that has potential for rocket ship growth,” the WeWork Dumbo Heights member says. “For years two and three, begin projecting on a quarterly basis. That allows flexibility to reforecast as you progress through your first year.”
Know your key objectives. What will you do with the money? Investors will ask how much funding you need, what it will be used for, and how it will be spent throughout the course of your timeline. “Entrepreneurs need to be able to call this up by memory and justify why these are the key objectives,” Kennedy says. Run through the exercise of asking yourself each of these questions, and answer each question on your own first, he says. “Your more sophisticated investors will hit you with as many of these questions as much as possible. The hope is getting to all these milestones at some point down the road,” Kennedy says.”
Research your market. “You can start talking about the target market you’re after versus the overall market,” Kennedy says. Take the real estate market, for example. “What’s the market for entrepreneurs that need space? How much of the market can be captured in year one? And extrapolate that out into year two and three, and see how much percent of the market would be captured.”