Write a new business start-up plan

CONSULTING METHODOLOGIES

You start a new business with a blank sheet of paper. It is like a simultaneous market entry, new product development, channel development and organisation building project.

Although every venture is different, these questions will make sure you cover every angle.

I Executive Summary

[This will also be the content of your Elevator Pitch]

• Who is the target customer and what is their pain?
• What is your solution?
• Why will you win (why are you special)?
• What are the returns to investors?

II Why will our customer buy from us?

• Who is our target customer? (Be specific, if B2B, name a target company)
• What “pain” are we solving for the customer? What is the “job” customers are trying to get done?
• Who are the current competitors? What are their strengths and weaknesses? How will they respond to our start-up?
• Why is our product/service differentiated in the customer’s eyes?
• What will we price the product at? Value-based pricing or Competitor-based pricing
• How will we sell/route-to-market? What is the offer to partners?
• How can we defend our competitive edge in the long term?

III What is our launch plan?

• Where are we today? What have we proven? What are our resources?
• What are the principle assumptions in the business plan?
• How are we going to test these assumptions cheaply and quickly?
• What are the other options when Plan A doesn’t work?
• What results/milestones are we going to achieve in the next 12 months?
• What are the greatest risks?

IV Do we have the right team?

• What skills/resources do we need to achieve our value-creating milestones?
• What does our venture need to be very good at?
• How does the experience/skills/contacts of our team fit with these needs?
• What skills will we need to recruit? Should we seek a “value-added” investor?

V What are the financials of our venture?

• What are the key drivers of our business economics?
  • What is our cashflow projection?
  • When does our business breakeven?
• Why is it attractive for an investor?
  • How are you going to fund this venture?
  • How is the investors money going to be spent?
  • How could an investor exit? (IPO, Trade sale)
    • When?
    • At what multiple?
    • If trade sale, who would pay a premium to acquire your start-up
  • What is the potential return? (IRR, NPV)

If this is a start-up within a bigger company, ask in addition:

• How does this opportunity fit with the corporate strategy?
• What resources can we leverage from the core business?
• What do we have to keep separate from the core business?
• How will this venture work with the core business?