In the beginning, one may have the urge to delve straight into specific strategies, such as evaluating production methods, studying market segments, and evaluating the competition—but do not do that, at least not yet.
Things like: Could you grow faster with more money? What are your headcount assumptions? How much are you spending on marketing expenses? What are you assuming for payments and collections lags?
The investment decision is about the content – the team, the market, the differentiators, the scalability, traction so far, validators, growth potential – not the presentation or formatting of the plan.
Ideally, the executive summary can act as a stand-alone document that covers the highlights of your detailed plan. In fact, it`s very common for investors to ask for only the executive summary when they are evaluating your business. If they like what they see in the executive summary, they`ll often follow up with a request for a complete plan, a pitch presentation, and more in-depth financials.
And you don`t have to start with the full, detailed business plan that I`m going to describe here. In fact, it can be much easier to start with a simple, one-page business plan—what we call a Lean Plan—and then come back and build a slightly longer, more detailed business plan later.
First, you want your business plan to be read. No one is going to read a 100-page or even 40-page business plan. Sure, you may need supporting documentation for specific sections but you can include those elements in your Appendix.