Business Plan Sanity Check: The Basics Nobody Told You Aboutposted by Anna Mar, September 13, 2011
Don't let complex balanced scorecards fool you: there are only two criteria for evaluating a business plan:
1. Attractiveness of Vision
2. Ability to Execute
Nothing else matters. Before submitting a business plan do a quick sanity check: does the plan resonate on these two points?
Attractiveness of VisionThis is the optimistic part of your plan: the part that gets your prospective investors excited.
Ideally, you have discovered a large untapped market whose time has come. The bottom line here is to convince investors that:
- a market opportunity exists
- the timing is right
- financial incentives are appealing relative to risks
Ability to ExecuteThis is the realistic part of your plan: the part that convinces your prospective investors that you are the ideal team to realize the vision.
Ideally, you have invested enough in the business already to prove your abilities. The key here is to convince investors that you:
- have the right team and connections
- have solid marketing and operational capabilities
- enjoy a unmatched competitive advantage
Scorecard ExampleA business plan scorecard needn't be more complex than the example below.
A plan has to score well in both vision and execution to pass (it doesn't matter if you have an interesting vision but can't execute or vica versa).
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