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How to Write a Winning Business plan 2019

John J. H. Oh
John J. H. Oh

This document provides guidance on how to write an effective business plan in 3 sentences or less: The document outlines the key elements that should be included in a business plan such as an executive summary, company description, products/services, market analysis, management team, and financial projections. It provides tips on how to effectively write each section including keeping descriptions concise and focusing on the problem the business solves and its competitive advantages. Sample outlines are also provided to illustrate how the various sections should be structured in the business plan.

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How to Write a Business Plan John J. H. Oh KAIST
Markets and Customers Management Teams Products or Services Business Plan Financing Form. Content. Fourth of Five Elements of Start-Up Success How many pages? How much time to write? When to write it? What's in it? Written for whom? Types of plans: Funding; Operational
Writing a compelling business plan Elements of a successful and fundable plan Some sample plan outlines Analysis of a classic venture capital-funded business plan Fatal 鍖aws and deal killers how to avoid them "Tips and Tricks" for writing the plan
Elements of a successful and fundable plan Markets and Customers (compelling) Management Team (proven) Products and Services (proprietary) Business Plan (content, format, presentation) Financing (ROI, pro-formas)
Concept Market development Steady state Product development Seed Seed Still working, you formulate your ideas in a business plan outline, and you start to build your management team You quit your job to pursue business planning full time. Your co-founders may remain working Funding is obtained. Your team members join you in the business launch Concept Operational Stages of Company Growth When to WriteYour Plan
Some fatal 鍖aws and deal killers how to avoid them Lofty Mission Statement (e.g., reduce world hunger, plow 10% of pro鍖ts into charity) Missing any of the 5 basics of success w/o acknowledging the fact Imputed ROI not attractive Fixation on "control," overt greed "Distributed leadership," or professed"socialist" management philosophies
Components of the Plan Executive Summary (1 pages) Company Description (0.5-1 page) Products or Services (2-3 pages) Markets (1-2 pages) Technology (1-2 pages) Competition/Competitive Advantage (1 pages) Business Model/Key Customers (1-2 pages) Operations (1 pages) Management (1 page) Financial Projections (1 page) Financing and Use of Proceeds (0.5-1 page)
Executive Summary Write this last
Company Description Vision Basic product offering Company history Markets to be served Company location Stage of business
Business De鍖nition The one-liner The one-line is a way to very quickly position your company
Product or Service What product or service will your company offer? Whats different or unique about your offering? What customer problem does it solve? What is your sustainable competitive advantage? Who are your current and future competitions, and how is your product better?
Market Market must be right. We look for unexploited niches. Where are the customers with open wallets? Where are the customers pain points? How long does it take to develop solution and recognize revenue? Are gross margins substantial?
Market Size A Total Addressable Market (TAM) Top-down analysis The Served Available Market (SAM) Segment of the market that you intend to address The Share of Market (SOM) Bottom-up approach
Technology Heres where you can use some technical jargon (but just some) Describe the following: Main components of solution Features and functionality Underlying technology Development environments Compatibility with other relevant products How your product 鍖ts the relevant technology value chain Patents and Patents Pending Save the deep technical description for a white paper
Business /Technology Who cares? Who is in the customers organization really suffers? (Hints: its not CTO or CIO.) So what? Is it must-have or nice to have?
Competition/Competitive Advantage Competitors include: Direct competition Substitute solutions Potential entrants Barriers to Entry may include: Patents (pending) Key partnerships Key customer relationships Expert management team Superior product, functionality Time to Market Cost advantages Switching Costs * HINT:The competition section is a good place to indicate who your comparables will be for valuations sake.
Business Model/Key Customers How will you make money? Product sales, royalties, licensing Upfront payments vs. recurring revenues How does your customer make money? How do you 鍖t in their picture? Products versus consulting and services Maintenance, upgrades, upsales, etc Who are your existing customers? Which customers will you target, and when? Be reasonable
Sales and Distribution Show that you know how to build a business. Speci鍖c about sales channels and key customers. Realistic about market development and sales forecast. Best guess Worst case
Management Team Full resume of top management, specially CEO, CTO, andVP of Sales BOD Demonstrate that the cofounders and early employees have deep domain experience and record of success. Point out any VP/Sr. Director holes you may have A void in the management is better than having a B-player
Financial (I) Income statement (pro鍖t and loss statement) Cash 鍖ow statement Balance sheet Breakeven analysis Cap table Monthly for the next two years, and yearly for additional three years
Financial (II) Build forecasts from bottom-up and include key assumptions (be able to validate analyst forecasts) Plan for 20-25% market penetration by year 5 Discuss and forecast headcount ramp Include additional financing rounds Give em a chart and a graph
Financing and Use of Proceeds Include: Funding required Milestones Hire key management Growth capital Technology development Manufacturing Future financing requirements DONT include a valuation
Executive Summary Write it LAST Make it a stand-alone document Start with a problem/solution paragraph Summarize each section of the business plan But, spend most time on: Product description Competitive advantages Business model & projections Management team Keep it short- Less than 2 pages
Packaging the Plan No right/wrong way: the need of reader is essential What are the challenges/ questions that can be raised by reader: answer these. Include supporting materials Dont make unsupported statements Designate an outside reviewer/ reader that can critique plan
Additional Tips Include your contact information! Spell check This is a living document and will need to be modified as you get feedback. Create a versioning system to keep track of any updates. Keep track of who has your plan, and which version they have (youll get specific questions)
Case Study Qualcomm Will Invest US$4 Million into a Korean Venture Company In a news conference on February 1, 2010, at the Seoul Grand Hyatt Hotel Paul Jacobs announced that Qualcomm is the world's best company in telecommunications chip industry and will invest US$4 million into a local chipmaker, PULSUS Technologies. In Cooperation with Korean industry, academic and governmental institutions, Qualcomms planned R&D center will expand research collaborations with Korean organizations and focus on advances in next generation mobile communication technology. PULSUS Technologies is a leading developer of Digital Pulse Modulation Ampli鍖er (DPMA) and has over 60 percent of the market share. Qualcomm was particularly interested in PULSUS's SoC (System-on-Chip) technology that was developed for the 鍖rst time in 2003, and digital audio standard for next-generation cell phones.The Ministry of Knowledge Economy and KOTRA used Global Alliance Project Series (GAPS) program to get Qualcomm's investment. GAP is an investment attracting program that introduces Korean companies to global companies, and GAPS has been operating it since last year. Paul Jacobs, Chairman of Qualcomm said, "I'm very happy that I have invested into an excellent Korean venture company, and I hope that this investment will be a foundation for PULSUS to advance in the international market." He went on to say, "It is very meaningful for Qualcomm to establish the R&D center in Korea, and I will continue to contribute to the Korean IT industry." (IT Times)

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How to Write a Winning Business plan 2019

  • 1. How to Write a Business Plan John J. H. Oh KAIST
  • 2. Markets and Customers Management Teams Products or Services Business Plan Financing Form. Content. Fourth of Five Elements of Start-Up Success How many pages? How much time to write? When to write it? What's in it? Written for whom? Types of plans: Funding; Operational
  • 3. Writing a compelling business plan Elements of a successful and fundable plan Some sample plan outlines Analysis of a classic venture capital-funded business plan Fatal 鍖aws and deal killers how to avoid them "Tips and Tricks" for writing the plan
  • 4. Elements of a successful and fundable plan Markets and Customers (compelling) Management Team (proven) Products and Services (proprietary) Business Plan (content, format, presentation) Financing (ROI, pro-formas)
  • 5. Concept Market development Steady state Product development Seed Seed Still working, you formulate your ideas in a business plan outline, and you start to build your management team You quit your job to pursue business planning full time. Your co-founders may remain working Funding is obtained. Your team members join you in the business launch Concept Operational Stages of Company Growth When to WriteYour Plan
  • 6. Some fatal 鍖aws and deal killers how to avoid them Lofty Mission Statement (e.g., reduce world hunger, plow 10% of pro鍖ts into charity) Missing any of the 5 basics of success w/o acknowledging the fact Imputed ROI not attractive Fixation on "control," overt greed "Distributed leadership," or professed"socialist" management philosophies
  • 7. Components of the Plan Executive Summary (1 pages) Company Description (0.5-1 page) Products or Services (2-3 pages) Markets (1-2 pages) Technology (1-2 pages) Competition/Competitive Advantage (1 pages) Business Model/Key Customers (1-2 pages) Operations (1 pages) Management (1 page) Financial Projections (1 page) Financing and Use of Proceeds (0.5-1 page)
  • 9. Company Description Vision Basic product offering Company history Markets to be served Company location Stage of business
  • 10. Business De鍖nition The one-liner The one-line is a way to very quickly position your company
  • 11. Product or Service What product or service will your company offer? Whats different or unique about your offering? What customer problem does it solve? What is your sustainable competitive advantage? Who are your current and future competitions, and how is your product better?
  • 12. Market Market must be right. We look for unexploited niches. Where are the customers with open wallets? Where are the customers pain points? How long does it take to develop solution and recognize revenue? Are gross margins substantial?
  • 13. Market Size A Total Addressable Market (TAM) Top-down analysis The Served Available Market (SAM) Segment of the market that you intend to address The Share of Market (SOM) Bottom-up approach
  • 14. Technology Heres where you can use some technical jargon (but just some) Describe the following: Main components of solution Features and functionality Underlying technology Development environments Compatibility with other relevant products How your product 鍖ts the relevant technology value chain Patents and Patents Pending Save the deep technical description for a white paper
  • 15. Business /Technology Who cares? Who is in the customers organization really suffers? (Hints: its not CTO or CIO.) So what? Is it must-have or nice to have?
  • 16. Competition/Competitive Advantage Competitors include: Direct competition Substitute solutions Potential entrants Barriers to Entry may include: Patents (pending) Key partnerships Key customer relationships Expert management team Superior product, functionality Time to Market Cost advantages Switching Costs * HINT:The competition section is a good place to indicate who your comparables will be for valuations sake.
  • 17. Business Model/Key Customers How will you make money? Product sales, royalties, licensing Upfront payments vs. recurring revenues How does your customer make money? How do you 鍖t in their picture? Products versus consulting and services Maintenance, upgrades, upsales, etc Who are your existing customers? Which customers will you target, and when? Be reasonable
  • 18. Sales and Distribution Show that you know how to build a business. Speci鍖c about sales channels and key customers. Realistic about market development and sales forecast. Best guess Worst case
  • 19. Management Team Full resume of top management, specially CEO, CTO, andVP of Sales BOD Demonstrate that the cofounders and early employees have deep domain experience and record of success. Point out any VP/Sr. Director holes you may have A void in the management is better than having a B-player
  • 20. Financial (I) Income statement (pro鍖t and loss statement) Cash 鍖ow statement Balance sheet Breakeven analysis Cap table Monthly for the next two years, and yearly for additional three years
  • 21. Financial (II) Build forecasts from bottom-up and include key assumptions (be able to validate analyst forecasts) Plan for 20-25% market penetration by year 5 Discuss and forecast headcount ramp Include additional financing rounds Give em a chart and a graph
  • 22. Financing and Use of Proceeds Include: Funding required Milestones Hire key management Growth capital Technology development Manufacturing Future financing requirements DONT include a valuation
  • 23. Executive Summary Write it LAST Make it a stand-alone document Start with a problem/solution paragraph Summarize each section of the business plan But, spend most time on: Product description Competitive advantages Business model & projections Management team Keep it short- Less than 2 pages
  • 24. Packaging the Plan No right/wrong way: the need of reader is essential What are the challenges/ questions that can be raised by reader: answer these. Include supporting materials Dont make unsupported statements Designate an outside reviewer/ reader that can critique plan
  • 25. Additional Tips Include your contact information! Spell check This is a living document and will need to be modified as you get feedback. Create a versioning system to keep track of any updates. Keep track of who has your plan, and which version they have (youll get specific questions)
  • 26. Case Study Qualcomm Will Invest US$4 Million into a Korean Venture Company In a news conference on February 1, 2010, at the Seoul Grand Hyatt Hotel Paul Jacobs announced that Qualcomm is the world's best company in telecommunications chip industry and will invest US$4 million into a local chipmaker, PULSUS Technologies. In Cooperation with Korean industry, academic and governmental institutions, Qualcomms planned R&D center will expand research collaborations with Korean organizations and focus on advances in next generation mobile communication technology. PULSUS Technologies is a leading developer of Digital Pulse Modulation Ampli鍖er (DPMA) and has over 60 percent of the market share. Qualcomm was particularly interested in PULSUS's SoC (System-on-Chip) technology that was developed for the 鍖rst time in 2003, and digital audio standard for next-generation cell phones.The Ministry of Knowledge Economy and KOTRA used Global Alliance Project Series (GAPS) program to get Qualcomm's investment. GAP is an investment attracting program that introduces Korean companies to global companies, and GAPS has been operating it since last year. Paul Jacobs, Chairman of Qualcomm said, "I'm very happy that I have invested into an excellent Korean venture company, and I hope that this investment will be a foundation for PULSUS to advance in the international market." He went on to say, "It is very meaningful for Qualcomm to establish the R&D center in Korea, and I will continue to contribute to the Korean IT industry." (IT Times)