“The business plan is dead.” As the popularity of the business model grows, chances are good that you’ve heard this sentence somewhere along your entrepreneurial journey. The fact is, if you’re planning on seeking investment for your venture, a business plan is essential. Venture capitalists and angel investors may not give you a second look without one. If your company is not yet ready to seek investment, it is still critical to do all of the thinking that is behind a business plan, even if you don’t put it on paper right away.
At last week’s Entrepreneurship 101 lecture, Jane Kearns, senior advisor in the cleantech and physical sciences practice at MaRS, spoke about the components of a business plan and other communication tools, including the executive summary and elevator pitch. She provided a valuable perspective, drawing from her experiences as a founder, operating executive, investor, mentor and venture capitalist.
Jane emphasized that your business communication tools should focus on communicating what problem you are solving, how you are solving it and why customers will pay for your product or service, all while being concise and avoiding technical jargon.
Your business plan will outline key milestones that you can use to track the progress of your business. In her lecture, Jane outlined the components of a business plan, including market, customer and competitive analyses, as well as marketing and operations plans, and financials and projections. She also provided a set of rules to keep in mind when developing your plan.
Executive summary and elevator pitch
While the executive summary belongs at the beginning of your business plan, Jane recommends writing it last, as it should accurately reflect your entire plan in a condensed format. Your elevator pitch should be a short and clear one- to two-minute explanation of the problem you are trying to solve and your value proposition. It should deliver an irrefutable message that will induce greed in your potential investors.
Your executive summary and elevator pitch will help you get your foot in the door of investors’ offices by capturing their attention. Once you have captured their interest and curiosity, they will take the time to read your entire business plan.
To hear more about these communication tools, as well as the components of a business plan, watch Jane’s full lecture below.
Produced by MaRS Media.
Next lecture: Meet the Entrepreneurs – Information Technology, Communications & Entertainment on Wednesday, December 11, 2013. Please note that this will be the last lecture before the holiday break. Weekly lectures will resume on January 8, 2014, with a Lived It Lecture featuring Allen Lau, co-founder of Wattpad.
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