QUESTION OF THE WEEK

How to prepare an eye-catching and solid business plan?

After defining their business model, the start-up entrepreneur must begin to imagine, plan and implement their business plan. The executive director of the Entrepreneurship, Repreneurship and Families in Business Hub at HEC Montréal, Manaf Bouchentouf, explains where to start.

IT'S WHAT?

A priori, the entrepreneur can approach his business plan as a communication tool to approach anyone who will be involved in his approach. This document must take the main elements of the business model to which are added a detailed financial plan, a commercial plan, a marketing plan and a production plan. It is structured in stages, in time and space. It defines the resources that will be necessary at each stage in achieving the qualitative and quantitative objectives. It is therefore an execution plan. The entrepreneur supports his progress with a 36-month growth plan, which must be coherent, realistic and essentially based on credible data or hypotheses.

FOR WHOM?

When the entrepreneur reaches the business plan stage, he is usually ready to seek financing. His business plan will then serve to demonstrate that he is in control of his project and all future deployment stages. It is the translation of the business model into actions and results. This valuable document is not strictly intended for the financial partner, but can be useful to the partner who works, for example, in research and development or even for another company with which he wants to partner.

HOW TO HIT HARD?

It is essential that the business plan presents the link that unites the business partners in the project, whether they are the founders, the team members and the people around them. For it to be impactful, it must be demonstrated that it is supported by a team capable of executing the said business plan. The entrepreneur must prioritize this aspect very early in the document, because financing is generally placed on the team before the product or service.

HOW TO CONVINCE?

Right after the team presentation, it is important to demonstrate what the company has already accomplished. In other words, we present: "this is my team and this is what we do". In addition, we must return to its execution plan: "this is what we have achieved on a small scale as a team. Now, we will justify to you how we are going to take the company further and why we need you as a financial partner".

A business plan is based on assumptions: we cannot predict what will happen in the future, but we demonstrate to the investor or banker that we have thought of actions that allow us to be in control of the execution of the project in a fairly realistic way.

The story that is told in the business plan through words must be supported in the financial plan, through numbers. In fact, it is a story that is read as much through numbers as through words.

Also read: How do you prepare for a first meeting with a banker?