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Start-up companies > Unit 5 - Business plan > Flashcards

Unit 5 - Business plan Flashcards

1
Q

Business Plan: definition

A

“Document that presents a business opportunity, identifies its target market and provides details about how the entrepreneur plans to pursue it”

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2
Q

Business Plan: purpose

A
  1. Identify the key aspects of the business
  2. To obtain financing
  3. To manage: maintain attention and control
  4. Improve the business model
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3
Q

Business plan TYPES

A

Plans for EXTERNAL stakeholders:
✦ Mini-business plans (pitch deck,)
✦ “Traditional” business plans (in disuse)

Plans for INTERNAL planning and control:
✦ Go-to-market plans (product launch)
✦ Operational plans (resources, investment…)

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4
Q

Business Plan: structure

A

NO FIXED RULES
NO STANDARD MODEL
DEPENDS ON AUDIENCE

Merging four key components (Depending on the plan +/- detail)

  1. People
  2. Opportunities
  3. Context
  4. Agreements
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5
Q

People

A
  • Founders and experience (on the ground and jointly)
  • Need to recruit new hires
  • Motivations, commitment and exits
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6
Q

Opportunities

A
  • Market sizing and growth potential
  • Competitors: advantages and barriers
  • Validated Business Model
  • Opportunity to expand your business model to other markets
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7
Q

Context

A
  • Business critical variables
  • Sensitivity analysis and variability
  • Risk management – contingency planning
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8
Q

Partnerships

A
  • Clients: prepayment and loyalty
  • Suppliers : strategic, key to the business
  • Investors: not just financial support
  • Importance of management per stages
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9
Q

Business plan: STRUCTURE - criteria

A
  • Phases (time led)
  • Areas (main functions of the Company)
  • Activities (customer facing, value chain…)
  • Combination of several criteria
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10
Q

Business Plan structure: Contents

A
  1. Introduction: Company description and objectives
  2. Market: Customers
  3. Competitors: Current and future
  4. Product and processes: operations
  5. Marketing plan: how to sell
  6. Finance plan: Forecast
  7. Legal and Shareholding aspects
  8. Annexes
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11
Q

PITCH DECK - concept

A
  • Slides to support the elevator pitch

* A quick overview of the company and product

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12
Q

PITCH DECK - utility

A

To draw attention to potential investors, customers, partners… and stand out from others

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13
Q

ONE PAGER - concept

A

An executive summary that condenses, on a single page, all the relevant information about the company

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14
Q

ONE PAGER - utility

A

To draw investor’s attention (with key data), to “intrigue” him/her and to make him/her request more information on of the company and product

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15
Q

One Pager Contents

A
  • Logo: Legible, recognizable, memorable and representative
  • Twitter Pitch or tagline: Sentence explaining who the company is, what it does and why it is important to others
  • Problem or “pain point”: Need to solve the client
  • Business model: How money is made
  • Solution: Value proposition, why it is superior to its alternatives. Images and details about functionalities (product)
  • Market: Current size, evolution in recent years, potential, TAM, SAM and SOM…
  • Competition: Data of each company (turnover, valuation, prices…)
  • Company profile: list or table, with general data (sector, date of foundation, investment to date…) and key metrics (“traction”, turnover…)
  • Team: Names, surnames, positions and experience (if there are mentors or investors)
  • Contact: Person, email, phone and website of the project
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16
Q

Market size estimation

TAM: Total addressable market

A

Size of the largest possible market, independently from our ability to reach and serve it

Calculation:
Total demand (Sales of competitors)
Industry total sales volume
Use: Sector reports (Gartner, Nielsen. IDC…)

17
Q

Market size estimation

SAM: Serviceable available market

A

Market we can actually reach and serve with the model we have designed (technology, capacity, channels…)

Calculation:
Maximum amount of units our model can sell per year
Use: direct research, reference of competitors

18
Q

Market size estimation

SOM: Serviceable obtainable market

A

Realistic market share we can obtain considering our resources and our competitors

Calculation:
Traction and growth hacking metrics
Use: Budgets, surveys, data from competitors

19
Q

INVESTOR DECK - concept

A

An executive presentation covering all business fundamentals in detail

20
Q

INVESTOR DECK - what is the purpose?

A

To start the process of selling the company

21
Q

Investor Deck Contents

A
  • COVER: Name, logo and tagline
  • PROBLEM: Description and quantification (TAM), who has the problem (B2C, B2B, B2B2C, women, young people…)
  • SOLUTION/PRODUCT: quantify effectiveness as a solution against competitors (pain killer vs. vitamin), features, images, demos, videos…
  • MOMENT: Why go to market or grow now (growth, evolution of technology, regulatory change…), product metrics, traction, sales…
  • MARKET: SAM and SOM, indicating how they are calculated, and the expected evolution for the coming years
  • COMPETITION: Description of competitors, positioning achieved, current (or sought) competitive advantage(s)
  • BUSINESS MODEL: how it monetizes, margin, recurrence and deposit profitability compared to competitors
  • MARKETING & SALES: current and future channels, costs and conversion rates
  • TRACTION: Evolution of KPIs based on the business model compared to similar companies
  • TEAMS: Positions and experience of key people (mentors, investors…) and founders
  • FINANCIAL ANALYSIS: Graph with the evolution and expectations for income, expenses and cash consumption (at least 3 years)
  • FINANCIAL NEEDS: Size of the investment round, objectives to be achieved and what the capital raised will be used for
  • FINAL SUMMARY: Key ideas to highlight
  • CONTACT: Company logo and contact details (usually CEO)
22
Q

What financial documentation does an investor need?

A
  • Profit and loss accounts and balance sheets achieved and expected (evolution)
  • State of cash-flow and cash burn rate
  • Explanation and metrics of the “traction”achieved
  • Calculation assumptions
23
Q

What is the financial documentation provided to the investor for?

A
  • Analyze the real situation of the company
  • Evaluate their evolution and trajectory
  • Make comparisons and scenarios
  • Study a due diligence process

Start-up companies (6 decks)

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