'Before starting to search for investors and financing, startups need not only to get a business plan, but also to make sure that it is reliable as a rock. Below you will find tips on how to make a successful business plan. They will help you to write an incredibly cool project and win investor confidence!
5 Tips for a better Business Plan
1. Be Sure to Describe the Market Potential
How big is your niche? Is your market growing? Is it full of regular customers? Does it have new features and growing trends? Is something threatening this segment?
By providing answers to these questions in your business plan, you will be able to convey the investor an idea of what you are striving for. Moreover, you can talk about growth and development opportunities that are key to the success of your startup. In fact, this is what you should have done when the idea of creating a startup appeared. If you did not do this, then your idea may be doomed to failure, because you will have no idea what to expect.
2. Rate the Level of Competition and All Threats
Instead of ignoring competitors in your business plan, contact them. Outline their benefits and find out the features you are different from them. Build a plan for how you intend to compete with companies already entrenched in your market.
This will provide investors an understanding that you have a head on your shoulders. You look at things realistically and see the whole picture. It is worth noting that this is a very good quality for a businessman!
Do not dwell solely on the shortcomings of competitors, do not forget to replay their advantages. When you focus on the fact that everything is bad for competitors, and you are good, you risk creating not the best impression in the eyes of the investor.
3. Make a Thorough Forecast
People invest in your business to make money. A three-year forecast will show investors how much your business can earn or how much it can lose. In this way, they will be able to assess the risks that they take by investing in you.
The forecast will look even better if you include in its competent market analytics, which is based on data from trusted sources.
This will once again show your serious attitude. And also show that you are good at business!
4. Outline Cash Flows
Even if you have just started a business, but you already have cash flows, you should describe them in your business plan and link them to the projected flows. Any profit that you describe in a business plan can be a green light for an investor!
Since this is the most attractive item of all, especially if it’s not abstract statistics, but real numbers. For example, it can be the indicators of the past years or realistic forecasts for the future.
5. Do Not Forget About a Brief Summary of Your Business
Despite the fact that it should go through the red line through your entire business plan, this item will be the last.
This is done in order to make sure that all other components of success are taken into account. It is a synonym for a variable in the exact sciences, which should give the investor an idea of who you are and what you want, including the results of your activities.
The summary should be concise and with a clear goal. However, do not forget about the mention of details, thanks to which investors will want to finish reading it to the end!
Common Mistakes When Creating a Business Plan
- The executive summary is written in an incomprehensible language and doesn’t meet the needs of key audiences. In this case, there is a risk that the reader simply sends the business plan to the trash. Please note that the summary is written last and is the quintessence of the entire business plan.
- A business plan is written for several different audiences at once. Doing this way, there are great chances that neither will read it. Write versions for each audience.
- The expected financial results of the project are too optimistic. The reader may think that you either do not know what you are going to do, or you do not understand how difficult it is to penetrate new markets. Do not make promises that look unrealistic.
- “Our project is universal and has no competitors.” Few people will continue reading your business plan after such a statement. It sounds like a recognition that you do not know your market. In real life, very few companies have no competitors.
- The plan is written in a very boring language. Reading it, your audience begins to yawn and fall asleep. As a result, the plan goes to the trash. Make an attractive cover with an interesting logo and edit the text part. Today, there is a large number of tools to improve the text. Now it’s much easier to create high-quality text than before! “They’ve just created so many high-quality resources for us to use that it would be almost criminal not to take this chance. Which tool should you use? That’s up to you.”, says Marie Fincher, the writer at Grab My Essay.
Here are some useful online services that you can use to create literate text for your business plan.
- Studicus: On this web page, you can order copywriting, rewriting and proofreading services. So if you are not sure about your text, feel free to contact this company for help.
- Trust My Paper: Here you can also use the help of professionals to improve your text. This service is ready to work with absolutely any topic, including a business plan.
- Grammarly: With this service, you can very quickly get rid of grammatical and punctuation errors. Also, the program determines the style of writing and gives various tips for improving the text.
- Hemmingway: With this application, you can make your text readable. Also, you will be offered options for replacing difficult words and provides a general assessment of the text.
- Paper Rater: In this online service, you can check text for grammar and spelling errors. The program analyzes the writing style, and you can check the text for plagiarism.
6. The repetition of similar ideas, concepts, and facts.
This creates the impression that you have nothing more to say and you simply duplicate information. Remember that quality is more significant than quantity.
7. The presence of contradictions of facts and ideas
This creates the impression of incompetence. Stick to one main idea. A business plan is not a discussion platform.
8. Team description consists of a summary of your friends and colleagues
At the same time, many of them are not suitable for certain positions in their professional qualities and were included in the business plan on the principle that the place should not be empty. It is better to leave these vacancies open than to fill them with unqualified personnel.
Sometimes friends shouldn't be on your founding team.
Summarizing the strategies of a solid business plan
So, a business plan is one of the most important keys to the success of your tech startup. Now you know what should be written in it. Make your business plan perfect with the help of our recommendations and become a winner!