Business Plans

Question 1

Business plans aim to:

Answer 1

• Raise money

- Work out where you’re going with the money you’re raising

Question 2

What information should a BP contain?

Answer 2

• Describe what you do and the way you think (advertise your brain, show you understand what you’re doing)
• Investors want to see a BP to know what is in it for them

Question 3

BP audience

Answer 3

Investors
Licensors
Directors 
Lenders 
Suppliers

Question 4

BP Templates

Answer 4

Available online
Some are free
e.g. UK gov, Princes Trust, Guardian, Barclays, Forbes
others are of charge e.g. liveplan.com

Question 5

Template contents

Answer 5

1. What you need to address (problem you are solving, current alternative solutions)
2. Your solution
3. Why your technology is the best
4. How your solution will succeed
   Inclusive of Gantt chart, organisation chart, financial forecast

Question 6

Gantt Chart

Answer 6

Shows series of tasks you intend to do, incl start time, duration, finish time, dependencies (second task can only be started once first task has been completed)

Question 7

Organisation chart

Answer 7

Dictates who you need to design each part in the Gantt chart (what people you need to achieve the goal, what skills you need those people to have)

Question 8

Financial forecast

Answer 8

Includes all expenses (salaries, overhead)

usually up to 3 years, sometimes 5

Question 9

Make sure you’ve considered in your BP

Answer 9

Design and manufacture
Prices and adoption
Regulations

Question 10

How a BP is used

Answer 10

a MAP
- describes current situation - this is out plan, this is how far we’ve come. If deviations happen, they happen in a knowledgeable way

A GAUGE

• Measure deviations from the map
• it is okay to deviate from original plan

A TOOL FOR PERSUASION

• Make your BP stand out
• Start with short email/phone call or 1 min pitch
• Keep information simple at the beginning to draw investors I

Question 11

BP as a MAP

Answer 11

• Product development
• Financial need / use of funds (understanding current market is important)
• Milestones (e.g. clinical trials - need to raise money for risk-reduction event) increase company valuation
• Competiton/costumers
• Exit planning (drag along/tag along clause)

Question 12

Drag along clause

Answer 12

if 75% of shareholders want to sell, all must sell

Question 13

Tag along clause

Answer 13

Minority shareholders have the right to have their shares bought at the same price as majority shareholders, protecting them from being left behind and having to sell at devalued prices

Question 14

BP as a GAUGE

Answer 14

Measures how you do compared to forecast

• Milestone based financing (further financing will only be given if milestone in BP is reached first)
• Incentives for the team (give bonuses)
• Credibility of updated BP (new financial forecast every year demanded by board of directors)

Question 15

Do you know what others are doing?

Answer 15

Competition
Regulation
Manifacturing
Skills needed in addition to yours

Question 16

Do you know what you’re doing?

Answer 16

Are you literate?
Are you numerate?
Can you communicate?
Do you have technical skills?