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Go from there. You'll get an idea from the feedback and from what the investors say to know if you should proceed writing the entire plan, maybe they will find some holes in it, etc. etc. Then if they still want the full plan in writing, go write it. You'll probably learn a ton just in the process of writing the executive review.
A related question, how much is a reasonable salary for a startup founder? Do investors usually assume the founders will be living in squalor, eating noodles and paying themselves nothing until profitability, or are investors usually open to founders that have existing financial commitments - family, mortgage etc. Probably varies massively, but I've often assumed that investment often requires you don't take a salary…
Good business plans are tough. I was taught at Northwestern by a very successful entrepreneur how to build the presentation, business plan, and financial model. You need to cover the basics. Here's what my last one covered: - Executive Summary - Project Information - Company Description - Market and Industry Analysis - Marketing and Sales - Operations - Management - Capitalization and Structure - Development and Mile…
While I realize much of the capitalist world still operates this way, I'd be hesitant about anyone who asked for a business plan. While a business plan isn't entirely a waste of time, there's just so much of it dedicated to pulling meaningless numbers out of your ass as to be an exercise in futility, and it gives them something to be pissed at you about later if you miss your fictional quotas. And if I even heard the…
The purpose of a business plan is to show that you've given some thought to how you'll run and grow the business. Anyone who thinks that's an exercise in futility will have a hard time getting funding. If you have an idiot investor, sure they might be pissed at you because of missed quotas, but you can also use them to look at your cash flow. If miss my Q4 quota by 30%, does that cause me to go bankrupt in Q2 this ye…
I know lots of people who got funding with no business plan, in fact few tech companies have them at all anymore. Giving thought to what you're doing does not necessitate a business plan.
Rather than making you waste days or weeks of your time writing one, smart investors simply ask you all of the key questions. Who are your competitors and how can you differentiate was asked in every meeting I've ever been to. I couldn't have raised funding once, let alone the multiple times we have, without having given thought to that and being able to answer.
http://www.nesheimgroup.com/quickup_model
(The financial projections are just one component of your business plan, of course.)
Earlier quoted context omitted.
The purpose of a business plan is to show that you've given some thought to how you'll run and grow the business. Anyone who thinks that's an exercise in futility will have a hard time getting funding. If you have an idiot investor, sure they might be pissed at you because of missed quotas, but you can also use them to look at your cash flow. If miss my Q4 quota by 30%, does that cause me to go bankrupt in Q2 this ye…
The purpose of part of the business plan is to show that you've given thought. A business plan is basically a collection of things that are pretty smart to think about and write down, plus a whole bunch of other crap you pulled out of your ass to try to impress investors. Smart investors have their own ass from which to pull numbers. I know lots of people who got funding with no business plan, in fact few tech compan…
No, it IS a business plan, just not written down. It's not a given that a business plan need to have 15 pages of black magic numbers pulled out of anyones ass.
Don't write a business plan.
Instead spend the time you would have spent on the plan putting together a kickass demo, or working on the product.
Having been approached, you're operating from a position of strength already. You should work that to your advantage - if you don't need the money then you can afford to negotiate more on your own terms.
If some documentation is required put together a Powerpoint of 5-10 slides explaining:
- Your product, and why it is unique (and defensible to competition)
- Your team's credentials and experience
- Your market, it's size
- Your competitors (including SWOT analysis)
- Your funding requirements (including salary)
- Your best and worst case scenarios for growth
Some good tips here: http://blog.guykawasaki.com/2007/07/how-to-write-a-.html
Whatever you do don't spend a month writing a 60 page document. Keep it short and sweet. Use lots of bullet points / bold highlighting to ease readability. No complex multi-idea paragraphs. And most of all, just answer the key questions.
Good luck.