I see a fair amount of business plans – it’s an occupational hazard. And over the years I’ve been asked by a few angel investors to assist vetting companies seeking financing.
Not long ago I sat with a company to discuss their business plan. The CEO and founder of this start-up presented his operating and growth plan. His basic plan was to achieve a level of sales and raise another $8-10M in a future round of financing.
They had all the charts, financial data, revenue forecasts, market studies, etc. Every chart was up and to the right — every conclusion was a tremendous return in years 3-5.
What caused this post were the less than confident and convincing answers to the following questions:
- Why should I believe you’ll achieve your plan?
- How are you going to assure success in the first 6, 12, and 18 months of your plan?
- Forget the multi-year success you expect, what specific things are you going to do to achieve your plan in the next 4-6 quarters?
- What is your sales cycle?
- How many suspects need to be “touched” to reach your revenue plan?
- How many prospects do you need to close to reach your revenue projections?
- How are you going to support the customers you win?
- What do you expect to be your rate and volume of repeat business?
My message to them is if you can’t convince me you can be successful in the near term, why should I believe you’ll be successful in the long term.
You should be able to see the near term clearly. You should know your business, market, and tactical plans for the next several quarters. If you can’t convince me you can be successful now, your chances of being successful later are slim to none.
If you say you’re going to achieve something this year, you should be able to detail the tactics used to achieve it.
Can you detail your next 18 months of sales success?
Food for thought.