How to write a business plan

By Jeremy Dent

Several readers have asked me to do something about writing business plans, but this is not my area of expertise. So I asked my friend and digital marcoms mentor, Jeremy Dent, to share his advice with us. Here it is – I think it’s brilliant!

There are many contexts to writing a business plan but, in a post like this, I need to generalise: do not write a plan at all. Write a pitch…first. You should still write a business plan. Just do it from the inspiration you find in your pitch.

A business plan is the elaboration of a pitch; a pitch is not the distillation of business plan. Why? Because a pitch is short enough to encapsulate and express your creativity and enthusiasm and it’s much easier to revise a pitch than a plan.

A pitch is also your story – the ‘why’ of the enterprise. Why you, at this point in your life, have conceived this product or service and why customers will want to buy at the price level you are considering. It should involve your mojo – something you are passionate about and will bring something uniquely different to the marketplace.

Another meaning of the word ‘mojo’ is self-confidence: it also means a strong sense of purpose and a clear identity of who you are and what you, and your enterprise, stand for, not just ‘what’ you are proposing to do. This inner confidence and certainty helps leaders to win hearts and minds, sales people to get prospects excited about their product or service and companies to build loyalty and brand value.

A pitch is the language of your mojo and your creative side; the plan is the nitty gritty details that are best tackled by your analytical persona. You should be able, at the drop of a hat, to stand up and speak about your idea for two, ten or 30 minutes. This is your ‘pitch’.

Give the pitch a few times to friends and colleagues, get honest feedback, see what works and what doesn’t, change it and only then write the plan. Think of your pitch as your outline, and your plan as the full text.

You may not necessarily need to pitch to investors, your bank or even other stakeholders but you do need to pitch to yourself; convince yourself that what you are about to risk – cash, time, energy – are not only worth it but worth giving up alternative courses of action.

Most venture capitalists use gut feel to lead a decision during a pitch: receiving (and possibly even reading!) the full business plan is more about due diligence.

A more relevant and important reason to write a business plan, whether you are raising money or not, is to force yourself to crystallise the objectives (what), strategies (how), and tactics (when, where, who).

Here’s an example of what should be in both your pitch and plan, not necessarily as formally listed as this, but these points should be covered: Executive Summary, Problem, Solution, Business Model, Underlying Magic, Competitors, Marketing and Sales, Team, Projections, Timeline and Conclusions.

Finally, don’t treat a plan as inflexible: it should change to meet circumstances. “Write deliberately, act emergently”, a Clayton Christensen epithet, means that when you write your plan, you act as if you know exactly what you’re going to do. You are deliberate. You may turn out to be wrong but you gave it your best shot.

However, writing deliberately doesn’t mean that you adhere to the plan in the face of new information and new opportunities. As you execute the plan, you act emergently – that is, you are flexible and fast moving, changing as you learn more and more about the marketplace. The plan, after all, should not take on a life of its own.

Jeremy Dent has a self-employed, portfolio existence, acting as a digital marketing communications mentor, leader and supplier under the brand Digital Supremo. He also works part-time as an Emergency Medical Technician for a private ambulance provider to the NHS and private customers. Find him on Facebook, LinkedIn or Twitter.

How to write more essential words for your business:

“Super Speeches”…how to write and deliver them well

“How To Write About Yourself”…how to make the most of yourself, whatever you need to write

“Business Writing Made Easy”…everything you need to know about writing for business in English

Comments

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Thoughts

  1. What a great blog! Business plans are usually very dry dull affairs – even writing one about a business I am really excited about can bore me to death! This approach gives it a purpose and keeps coming back to the desired outcomes – which it’s easy to feel excited about.

  2. It’s a simple yet powerful approach, isn’t it, Jane? I think it’s very good advice.

  3. The ‘mojo’ or USP needs to take two things into account; firstly what is it that you’re really good at and secondly what makes the most margin. There may be two or three potential USPs in the frame and you need to be prepared to move away from something that you feel an affinity towards if there’s something else that has a much better margin.

  4. Completely agree about writing a pitch rather than a business plan to get started, Jeremy. It’s much more digestible and focused plus it helps to win business, which is much more important than a dry business plan!

    • I think people can be scared to write business plans as pitches, and hide behind stuffy terminology and pompous business jargon that must bore potential investors to tears. I’ve helped a number of startups write the marketing sections of their business plans and it is often hard to persuade them to be bold and positive…

  5. Here’s a useful link/free resource for exploring business models.
    http://www.businessmodelgeneration.com/canvas

  6. Good point, James. Our mojo might not make a profitable enterprise. I suppose I had assumed that there was a prior stage to writing a business plan, that of assessing your strategic options and marrying your mojo with an enterprise concept that would be sustainable.

  7. I like it!

    Simple but brilliant idea – reversing pitch-and-plan from the way it’s usually done makes the whole concept (of both!) a lot more clear and simple. (Mind you, I’d argue that there should be a third stage of Presentation, but I would say that, wouldn’t I! 😉 )

    S

    • Yes, you would say that, Simon, and you’d be right to do so. Good presentation skills are essential to help bring a pitch/business plan alive.

  8. This is an interesting perspective, Jeremy! A business plan is indeed a “pitch” of sorts, but some people are even more terrified of terminology that smacks of “marketing and selling” than they are business jargon, I’ve found.

    In my line of work (as a business start up coach) I know that business planning is more than writing a document, which is what I think you’re really getting at here. It’s part of a development process. And I also know that it doesn’t have to be dry, boring work. In fact, I am 100% certain that if it DOES feel that way, you aren’t doing it right. Getting in touch with what is exciting about the business is certainly great advice, whether you call it your USP, your pitch, or your message to the world.

    This business plan stuff is about the thinking that goes on before the document is written, not the end result necessarily. If you can help people approach it as the creative, energizing activity it is meant to be, a business plan brings life to the business. If not, it just gathers dust.

    So I think you’re on to something here but there may be more to it than just reversing the order around if you want to get a really solid, exciting plan developed.

    • I’m quite sure that Jeremy (and our readers) know that there is a lot more to producing a powerful business plan than merely reversing the order, as you put it, Rebecca! Jeremy’s concept is very simple but puts across the need to turn the traditional thinking upside down which I suspect is very important in an era when potential investors must be getting so, so bored with yet another “properly produced” business plan. Thanks for stopping by!

  9. I’m pitching my business to a local entrepreneurs’ group later this month. This post will be very helpful as I figure out how to present my business in the best possible light.

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