BUSINESS SENSE
“Plan for Success” – Week 2
Nancy Larsen, Enterprise Facilitator of SEFP

Being an Entrepreneur is not an easy endeavor. Developing a business plan, requesting funding from strangers and facing rejection makes it even harder. What you are about to do takes courage and strength of will. Are you ready?

Capitalizing your business is a full time endeavor. Developing your business plan is the single most important step you can take toward your success. To maximize your potential to receive capital, it is vital that you develop a business plan that will guide your company and allow outsiders to picture where you are going and how you plan to get there. Take great care in preparing your plan, it is the road map that will lead you where you want to go.

Lenders or Investors, which way do I go? They tend to look at transactions from very different perspectives. Lenders are mostly concerned with “can you repay?’ While investors are more interested in “How far can you go?” There are certain items of information common to both. That will be the information to be disclosed at the start.

The Executive Summary is an overview description of your product or service, its market, your niche, the management, the mission, company structure, Performa highlights, funding request, use of funds and proposed terms. It is important to summarize, “sell the sizzle and not the steak” and the details will follow.

In the details, you will describe what your company is all about and document any history behind it. Next, a one-sentence mission statement defines what it is all about, not just flowery words. It is important for any funding source to know where you fit in the economic food chain and you will describe what niche your business is exploiting to make it jump over the competition. Market research supports your determination that there is a market and need for your product or service. This will form the backbone of support for the price points and revenue assumptions contained in your pro forma projections indicating to investors or lenders how your company can turn a substantial profit.

Remember, “The person who believes they need help from no one, quickly learns they have a fool for a partner”. Next week we will highlight the players.

Next weeks topic is: “The Players”

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