Blake’s Business Basics
Posted by Trevor on 1 March 2012 | 2 Comments
Trevor Blake’s Business Basics, Part One: Business Plan & Budget
In my experience, the one imperative to a successful business plan is that you get it down to one page. This may come as a shock to MBAers with a business plan in their hands so comprehensive it’s the size of a thesis. Who has time to read that? Not investors. If you can’t pitch your idea in one page, don’t bother. If the idea isn’t that clear to you, it won’t be to investors.
Think of your business plan as an “elevator pitch.” Imagine stepping into an elevator at the same time as a woman with a million dollars in her pocket, but she doesn’t know where to invest it. The time it takes the elevator to reach her destination is all you get to sell her your idea. You have to pare that thesis down to the core. This becomes your one-page business plan.
Budding entrepreneurs make the same mistakes jobseekers do. Many of the unsolicited resumes I receive are pages long. The length isn’t the problem. It’s that the more detailed information you give me, the more opportunity I have to make unchallenged judgments. A good resume gives just enough information to entice me to call the candidate and learn more. One of the best sales people I’ve ever hired started off her resume with how she handled being the only female waitress selling cocktails in a male gay bar in San Francisco. I was intrigued enough to call. She closed our phone conversation by asking when I’d be available to meet her for an interview. That’s perfect technique.
Like resumes, the business plan is a fishhook for investors. It needs to contain enough information to intrigue. Too much information and they won’t turn past the first page. Investors make profit off of the money they lend. Tease them with your concept, and invite them to call you to learn the details on how it can bring them a significant return on investment, then, it’s up to you and the passion you have for your idea to close the deal.
Once you get into budgeting, whatever budget is mapped out, double it. Working on the assumption that everything costs twice as much, takes twice as long and will be twice as complicated has saved me from making a fool of myself more than once. This is not meant to sound negative, but it’s been my experience. Throughout this series, you’ll find again and again that most business basics boil down to one key point. Keep these in your pocket as you navigate the business world and you’ll see it’s not so complex.
Photo: I took this photo of Mt. Rainier from a plane as I was on taking off from Seattle airport, heading south. It is rarely as clear as this. Mt Rainier is over 14K ft and as majestic as it looks is considered one of the most dangerous volcanoes on the world.