Starting a business begins with an idea. This Idea is intangible has to be written down for the business to become reality. Writing a business plan can be challenging for new entrepreneurs who lack the skill to do so. New business owners seeking to start new businesses can hire a business plan writer to write a professional business plan. The business plan is the most important element needed to obtain venture capital . A successful business plan should have a solid financial structure, unique concept, and marketing plan.
David E. Gumpert is the author of the best selling book entitled “Business Plans That Win”. David wrote an online article for Bloomberg business week in which he explains the 5 types of business plans. David’s advice is that you must first determine what type of plan is needed for your business. For new business owners, a full business plan is recommended. A full plan consists of 25-35 pages in which the business has a full explanation of the business concept the company, location, the owners, financials, and marketing data. Potential investors will not read the whole business plan but instead will review key sections.
According to Dave Lavinsky, investors and venture capitalist are not investing in just a great idea anymore. In order to get funding for your business idea a business must be able to show strong marketing and the ability to create cash flow within the first year of doing business. The business must be able to show that profitability going into the fifth year of business. The current recession has caused investors and venture capitalists to scrutinize business plans to avoid losing money.
In a special report written by John Tozzi “The Truth About Venture Capital”.
John explains that venture capitalist are looking for business plans and companies that have the ability to show fast growth. “Venture firms focus their investments on the handful of industries where explosive growth is possible. Biotech and medical devices made up 23% of 2007's venture deals, according to the Money Tree Report. An additional 24% went to software companies. Retailing and distribution, consumer and business products and services combined accounted for 289 deals, or 8% of the total. Location counts, too. California is home to 41% of the companies VCs funded last year. An additional 13% were in New England.”(www.businessweek.com)
Despite this turbulent economy there is still hope for anyone wanting to start a new business. Avoid the use of business plan software because it is viewed as unprofessional. Seek the advice of an expert if you are wary about writing a business plan. A well-written business plan with the correct information is a step in the right direction in obtaining funding to starting the business of your dreams.
Sources
http://www.businessweek.com/smallbiz/content/jan2008/sb2008017_014641.htm
http://feedroom.businessweek.com/index.jsp?fr_story=a6be55484f395148180836b4e80cb8d042fb2c8e
http://www.businessweek.com/smallbiz/content/feb2008/sb2008021_536847.htm
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