Have you ever wondered why some entrepreneurs can raise millions of dollars for multiple companies they start while most others can’t raise any money? Do you wonder what investors saw in the popular skincare line Carol’s Daughter? How can we as entrepreneurs have greater success in our businesses?
Cheree Warrick, author of the book Creating Business Plans that Actually Get Financed, says “A great business plan is the cornerstone of a great business. When entrepreneurs take the time to properly strategize about their company and write down a simple business plan (even if it’s just one page), they improve their chances of success exponentially. If we want to succeed in business, we need to create strong business plans – what I call ‘investable’ business plans.”
Success in business is similar to success in life. Successful people not only visualize their success but they plan for success. It is well documented that having a good business plan is an important step to succeeding in business. One in four start- up businesses will fail in the first year of operation. A primary reason for the high failure rate of startup businesses is poor planning. Owning a successful business is part of the American dream and countless number of people pursue this dream only to experience a nightmare. Individual failure in business has catastrophic results financially and personally. The emotional stress from business failure can impact health and cause family problems. On the bright side, success in business brings great personal rewards which include financial security, independence, respect, and recognition. Also small business success is the backbone of our economy and results in the employment of millions.
“Did you know that the average company that raises capital for their business hires 3 full time employees?” Warrick says. “This does not include the number of contractors that are given opportunities. Creating an ‘investable’ business plan will attract great team members, entice Advisory Board members or key influencers in the community to join their company, and even attract investors. The reason is because writing down your vision for the business enables you to articulate it in conversation. Articulate leaders get capital and great team members.”
A good business plan is the best way to minimize the odds of failure and exponentially increase the odds of success. A pletoria of books, computer software, and websites are available on how to prepare a business plan. Universities, government agencies, consultants, and nonprofits offer help in preparing business plans. Cheree’s book, “Creating Business Plans that Get Financed,” is an excellent book on how to prepare a business plans. The book’s focus is how to create a business plan that will get financed. This is a good litmus test for a business plan because if a bank or investor is willing to invest money in your business idea, this is a critical vote of confidence in the potential success of your business.
Cheree’s book is concise, well written, and informative. Her consulting practice, The Profit Partner, LLC was born because many entrepreneurs wanted more assistance in writing business plans that banks and angel investors fund. The introduction to the book has a ten question yes or no survey addressing the question: Are you ready to get financed? Four of the questions include:
1. Have you either beta tested your product of service or done a thorough market survey of your idea? Can you prove you have a hungry market place and your idea is the right solution?
2. Can you articulate in-depth industry and competitor knowledge with full understanding of competitor strengths and weaknesses as well as marketplace opportunities and threats?
3. Does your management team have the proven industry and management knowledge/experience?
4. Do you have financial forecasts with conservative revenues and aggressive expenses that indicate a viable profitable business?
If a business plan can address these questions and the other six in the book, the business will have a better chance of getting financed. Most important - the odds of business success will be exponentially increased.