CHAPTER 8: BUSINESS PLANS: SEEING AUDIENCES AND YOUR BUSINESS CLEARL

Invention Plan

focus on the plan that focus on the details of an invention, including intellectual property rights

Private Placement Memorandum (PPM)

- A specialized legal form or the other type of plan that adds to a business plan crafted by lawyers for the purpose of soliciting formal investments.

Elevator Pitch

30-second (100 words or less) action-oriented description of a business designed to sell the idea of the business to another.

Operational Plan

A business plan designed to be used internally for management purposes and serve as working documents within a business

Informational Plan

A business plan that gives potential customers or suppliers information typically consist of company and organization sections

Proof-of-Concept Website

A special form that based on Internet-based, and it is a business plan that provides information or demonstration of a product or service designed to solicit information on customer interest

Key Employee/Partner Plan

A summary plan that provides information on the company, product/service, market, and critical risks to prospective business or marketing partners or to prospective key employees including the all materials of an informational plan.

Screening Plan

Also called a mini-plan, gives the basic overview of the firm and a detailed look at the financials.

Data room

An online repository (e.g., Drop box, Box, Share Vault) for the documentation that back ups and details the specifics of your business and business plan. T

Business/team

Describes the current stage of the business, the timeline, and the team behind the product

Problem

Describes the need for the product or service

Product

Describes the product or service and how it is used

Market

Describes the size and characteristics of the customer group and how they will buy the product or service (e.g., in person, online, catalog)

Competitive advantages

Explain what makes the product or service unique, often in terms of an entry wedge.

Financial summary

Gives sales, growth, and profitability information, and if funding is sought, an overview of that

Overstated numbers Numbers that are wrong Inadequate cushion Inadequate payback Narrative and financials that do not fit No direct customer connection Uncertain sales (especially conversion rates) Overlooked competition Experience deficits "What" problems Deadly aggravations

The Most Common Critical Risks in a Pla

Working capital

The cash immediately available to the firm for the day-to-day expenses and operations of the firm

Pitch Deck

The name of a slideshow presentation that summarizes a business or more often a business plan.

Risks

The parts of a business or business plan that expose the firm to any kind of loss- profits, sales, reputation, assets, customers, and so on.

Due diligence

The process of investigating a business to determine its value and potential for investment.

Preselling

This involves introducing your future product to potential customers and taking orders for later delivery

External legitimacy Internal understanding.

Two circumstances under which creating a business plan is absolutely necessary

business plan

is a document designed to detail the major characteristics of a firm—its product or service, its industry, its market, its manner of operating (production, marketing, management),and its financial outcomes with an emphasis on the firm's present and future

Vision Statement

is a very simple 5- to 10-wordsentence or, better yet, a tagline that expresses the fundamental idea or goal of the firm. Related to the vision statement is a mission statement, which is typically longer (20-50 words) and often adds the firm's competitive advantage.

Executive summary

one- to two-page (250-500 words) overview of the business, its business model, market, expectations, and immediate goals. It is typically put at the start of a business plan and is the most popular summary form for a business plan.

Pitch

provides an overview of the key points of the business plan—a chance to sell your ideas and, most of all, a chance to sell yourself.

Business Plan

the standard for describing the business in detail