From Zero to a Million: Those Darned Business Plans!
Since launching Hardbacon, I’ve tried to go as fast as I can without wasting time on paperwork. Nevertheless, the issue of financing has to be addressed.
So last week, I put working on my business on the backburner in order to write up a business plan. Not just a Business Model Canvas that takes five minutes to complete, no, not at all. I created a good old-fashioned business plan.
It’s extremely frustrating, but many organizations, like Futurpreneur, require a business plan. Sure, many risk capital investors no longer require a tedious document like this, however, doing a round of financing with risk capitalists is such a time-consuming process that it forces almost all start-up CEOs to retire from the operations for three to six months.
In both cases, I believe there is something wrong in the start-up financing process, as it doesn’t even benefit investors. In fact, they should be most concerned that the entrepreneurs they finance are able to devote all their time to building their businesses.
Since Futurpreneur works with the BDC, I decided to use the business plan kit created by the organization. This kit isn’t really suitable for start-ups: the sample business plan provided is for a company specializing in furniture manufacturing.
Despite everything, for someone without an MBA and who never participated in a business plan competition (who knows, maybe it will one day become an Olympic sport), the kit is still pretty useful.
So I used the template and completed one box at a time, without letting myself become overwhelmed by the amount of work involved. I still have to do my financial projections, but I’m rather pleased to have finished the rest.
Considering everything, writing a business plan IS like going to the dentist.
There’s more apprehension than actual pain. However, unlike going to the dentist, I believe drafting a business plan should be delayed as much as possible. The farther along you are with your start-up, the less “fiction” your business plan contains. In fact, if I didn’t need any money, I would have waited a few more months before putting it together.
Despite everything, I’m pleased to have a document that contains the things I’ve often said out loud. In particular, there are two parts of a business plan that all entrepreneurs would benefit from putting on paper, regardless of their stage of development.
There’s the part about the market, which helped me compile my most important discoveries about the investment market into one document. Too many founders of start-ups embark on a project without any market study and invest time and money on a project doomed for failure. In fact, all too often I meet entrepreneurs whose ideas — doomed for failure, in my opinion — have already been attempted by many start-ups before them, and I was the one who had to give them the bad news.
The second part that seemed useful to me was the action plan. In the heat of the action, I manage my day without losing sight of my long-term objective to make our financial system more accessible. However, setting measurable short-term and medium-term goals with deadlines is a good way to prevent running around with your head cut off.
In fact, the business plan itself isn’t a bad tool. Profitable companies operating in a fairly stable industry should all have one. The problem is that an organization trying to do something new doesn’t know how it will properly capture the value it will create. And even if it does know, it certainly won’t know how much.
It’s the same thing with respect to certain technology markets that change more quickly than a business plan can be updated, or recruitment, which in my case depends strongly upon the people I meet, and their motivation.
Major Accomplishments:
• Completed a first version of the business plan
• Signed a partnership agreement with Questrade
• Website SEO optimization
• Launched a questionnaire for our list of the best blogs about money
Growth Metrics:
• Revenues: $0
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