Written by Burke Franklin, CEO and founder, JIAN
“The plan is nothing.
The planning is everything.”
– Dwight D. Eisenhower
There may have been a day when people read business plans cover to cover. Not anymore. When they get close to giving you money, they might, but first you have to grab their interest and answer their questions. Organize your plan like a reference guide. This will allow readers to turn directly to the information they want to see. Different people will want to know different things; some things are more important to some people than to others. The components of a business plan and a brief description of each part’s function are described below.
- Cover Letter – Tailor and introduce your plan to a specific audience. This section may need to be rewritten for different groups of investors.
- Non-Disclosure Statement– Ask your reader (politely) not to discuss this plan with anyone else.
- Title Page – The title page will give potential investors their first impression of your venture, along with the name, address, phone number and email address of the company and the CEO. For your first impression, make a bold, clean visual statement about your company.
- Table of Contents – Ideally, your business plan will be a reference guide to your business and not a novel or a thesis. Number your pages. Start each section on a new page. Colored tabs dividing each section immediately make your plan more visually appealing and easier to use. When I reviewed a number of plans during a business planning competition at the University of Texas, I was drawn to the plans with the colored tabs- the other judges admitted that they were, too.
- Executive Summary – This portion of your plan summarizes the highlights. This will be read first by investors (so make sure it is easy to find). Get to the point and be interesting- explain why your business is a great investment. If you lose your readers here, forget having them read any further. Remember to answer the questions outlined in our recent post, ‘What Investors Want to Know….’ This is a snapshot of the present state of your business plus a brief description of where your business is going and what it will look like when you get there. Write this summary AFTER you have completed your plan and keep it under three pages. Click here for a more detailed look at the all important Executive Summary.
- Company Direction – Tell your reader about the identity of your business and where it is headed. Include your vision and mission statements. This is the part that, throughout history, has made the difference between great leaders and failures. Your vision comprises your emotional drive to build your business to be something great that others can get behind. State your objectives: Where are you going? What will it take? What will you do with THEIR money? Investors want to know how and when they’ll make zillions on their investment in your business.
Check back for part 2. Just like your business, your business plan needs to have something that sets it apart from the others. It needs to show your passion as well as your plan. You know that your business is the next great thing – how will you show that to someone else?