- Advertisement -Your business plan is not just a document; it is your guiding star in the entrepreneurial galaxy. So, why settle for a static plan? This is the author’s take on embracing the dynamism, infusing narratives, and committing to sustainability in this part of his ongoing series Most startups are typically valued on future earnings. This is risky, because the future is unpredictable, and the numbers are not being linked to reality. Many Indian startups, unfortunately, are overvalued. Look at the recent news and market. Looks like the funding winter is coming, realistic valuation is on the cards. The valuation bubble is bursting with a reset in sight. In the fast-paced arena of startups, where ideas flourish and innovation reigns supreme, valuations have always been a sort of black magic. But when you get them right, the benefits are multifold. They often result in operational efficiency, better value propositions, better scaling possibilities, and better access to funding. So, where does a business plan fit into all this?
And why it is necessary?In the dynamic and ever-evolving world of startups, having a well-structured business plan is akin to a compass guiding you through uncharted waters. At its core, a business plan serves as a roadmap, illuminating the path to success by outlining your startup’s mission, vision, strategies, and goals. But beyond this conventional wisdom, there is more to what it entails. The question really is—can a business plan be an asset? And if yes, what must go into it?
Clarity amid chaosIt would be an understatement to say the current world is more chaotic than we would like. Add to that life of a startup, which is often rife with ambiguity and uncertainty. A well-thought-out business plan brings clarity to your vision, helping you articulate your unique value proposition, target audience, and market differentiators. It is a tool for making critical decisions with confidence.
Strategic directionBeyond being just a document, it is a strategic tool that helps you define short-term and long-term objectives. This plan should evolve alongside your business, adapting to market shifts and insights while maintaining your core values. More so, it is a brain dump of founders or CEO that others can read and understand. Without that people may feel they have understood the vision, but it would be only partially correct.
Investor magnetSavvy investors are drawn to startups armed with a comprehensive business plan. Not because they like PowerPoint decks or anything such. But because they understand the value of writing your thoughts and ideas on paper. It not only showcases your dedication, market understanding, and financial projections, but it also increases your chances of securing funding due to increased confidence.
When should you write one?While conventional wisdom dictates a business plan should be drafted before launching your startup, it is only partly true. What one must recognise is that a business plan is not a static document. It is a living document that evolves with your business. I won’t be afraid or feel any less if I were to revisit and revise the business plan as I progress.
What should you cover and what you shouldn’t?This is not to give you conventional business plan writing tips. If you are reading this, it is likely that you already know what a business plan is and what it covers. However, if the goal is to not just keep it as a document and convert it into an asset, then a few more details must go into it.
Adaptability strategyWith so much chaos and moving targets, a plan that describes how your business can pivot in response to unexpected market changes will go a long way. Show that you are not just planning for success but also for resilience.
Customer storytellingConventionally, customer stories have no place in a business plan. But that is where an asset differs from a plan. Try to incorporate narratives of how your product or service could change a customer’s life. This humanises your business and adds emotional depth. It also makes you think differently.
Sustainability commitmentThis is probably a new one. Earlier ESG was only on the agenda for big companies. Now it is everyone’s business. In today’s conscious consumer landscape, detailing your commitment to sustainability and ethical practices can be a unique selling point. While these are a few key things to add to your business plan, I might also cover a few things that should be avoided.
Overly optimistic projectionsWhile optimism is crucial, unrealistic financial projections can undermine your credibility. Balance ambition with grounded projections. Nearly every second startup I have seen has had out-of-the-roof projections. They don’t account for inflation, unforeseen market changes, tax implications, etc.
Lengthy jargonMore often I see people trying to stuff too much jargon, just to appear and show off that they know the industry. This is vanity and I highly recommend against it. Instead, communicate your ideas clearly and succinctly. The goal is to communicate, not to show off.
Excessive detailDo not drown in minutiae. Focus on the big picture and key strategies, leaving room for adaptability.
The point isCrafting a business plan is more than just a ritual; it’s a strategic exercise that empowers your startup to navigate the unpredictable waters of entrepreneurship. By blending conventional wisdom with daring, unconventional ideas, you can create a business plan that not only secures funding but propels your startup toward sustainable success. A business plan is not a static manuscript; it’s a dynamic blueprint that evolves with your journey, embracing change, and harnessing innovation. And most importantly, when you add things that are beyond convention but still relevant, a business plan can become an asset. An asset that can be used by everyone in the business. An asset that is not just stored in a file folder but frequently used for strategising and executing.
Anand Tamboli is a serial entrepreneur, speaker, award-winning author, and an emerging-technology thought leader