Growth accelerator for startups & scaleups
If you apply LEAN Startup: don't worry and continue with product- and market validation. If you don't know whether you can make a business out of it don't bother about writing a Business Plan. Continue reading this page, because it gives direction for setting up your business. If you don't know it all: start writing and define actions for the open questions. This sets your focus and makes you move faster. If you share your Business Plan don't be afraid of having unanswered questions. Show you know what you don't know and define your actions to get these question answered.
The Business Plan justifies the plans for your business. What's your mission and vision? Who are the customers? What products do you sell them? What's the position of the company in the market? What makes the company unique? What are the ambitions? What are the opportunities and challenges? How do you get there? What are the predicted profitability and costs? Red Harbour can support you in writing your business plan and obtaining financing from a bank, crowd funding or investor/angel. The Business Plan template can be found at the bottom of this page.
Download: Business Plan Template
The answer to this question depends on when in the process of creating your company you ask this question. The first common moment to draw up a Business Plan is after the positive completion of the Market Fit, just before you start scaling up. Only at this point do you know that you have a feasible business model. If you do this earlier, you have to deal with more uncertainty, and there is also a greater chance that you will not get financing (in case you draw up the Business Plan for financing). Often there is no second chance to obtain financing. Assuming this moment, you have the following products ready:
1. All products of product fit, solution fit and market fit from LEAN Startup
2. Vision and Mission
3. Business Model Canvas
Use the Business Plan for Startups template found at the bottom of the page. This template has been specially prepared for startups and scaleups. The working method of a startup is different from that of a regular start-up company and this template therefore works better for startups than the Chamber of Commerce template that many start-up companies use. The crucial difference is that 'market fit' has often already been established for regular companies and that the company will be an additional player on the market. With a startup, the question is whether there is a market at all. The Business Plan for Startups is also a better form for some regular start-ups, because this plan better addresses the customer's profile, the customer's problem and the suitability of the solution. This allows financiers to make a better estimate of the viability of the company.
Below you will find the layout of the Business Plan.
2 Vision and Mission
2.2 Mission Statement
3.1 Customer Profile
3.2 Customer problem
3.3 Offered Solution
4.1 Curriculum Vitae
4.2 Personal Qualities
4.3 Personal Motivation
5.1 Market Description
5.2 Market Development
5.4 Competition Analysis
5.5 Customer Approach
5.6 Growth Engine
5.7 Price Strategy
6.1 Legal Structure
6.2 Ownership relationship
6.3 Internal Organization
7.3 Legislative changes
7.5 Compliance Function
8.1 Annual figures
8.2 Financial Risks
8.3 Financial Scenarios
8.4 Valuation Company
Summary of the Business Plan. Keep this limited to a maximum of 1 page. The target group of this page are the financiers or investors in your startup. They want to decide within a few minutes whether they want to delve further into the Business Plan. This is the core of the plan. What is the problem you are solving? Who is your target audience? What solution do you offer? How have you demonstrated that you have a growth model? What income are you going to create and what costs are associated with that? If you need financing, please mention it here.
What does the company stand for? The Vision is strongly value related and forms the identity of the company. Strong values contribute to people, society and the world. Think e.g. visions on climate, sustainability, circularity and biodiversity. The Vision acts as the compass of the company. Companies are constantly changing due to changing market conditions and innovations, but the Vision hardly changes in the meantime. The Vision guides the Mission (see below) and determines the response to changes in the market, technology and legislation/regulations.
What does the company want to achieve? The Mission Statement is derived from the Vision of the Company. The most famous example of a Mission Statement is that of the mission to the moon, on May 25, 1961 by J.F. Kennedy said: "Before the end of the decade, man has set foot on the moon." All work at NASA was dominated by this mission and the necessity of activities was tested against this mission. Like the Vision, the Mission Statement thus forms the compass of the company, but is even more directional. The mission statement appeals to the imagination, but is at the same time concrete. You remember a Mission Statement at once. The 'what was it' Mission Statement is always a bad Mission Statement: you cannot connect to it. The Mission Statement consists of a maximum of a few concise sentences.
There are few subjects that are as intertwined as Vision and Mission. What is Vision for one person is Mission for another and vice versa. Many websites mention the different uses of these terms. Red Harbor uses the most common definitions. It is striking that many companies have a clear Vision Statement, but no clear Mission Statement or vice versa. In any case, it indicates how difficult this matter is in practice and it is therefore also difficult to formulate both a clear Vision and a clear Mission Statement.
Describe the characteristics of your typical customers here. For this you use the information from the Personas that you have drawn up as part of the product fit of LEAN Startup. Make explicit what needs or pains your (potential) customers have and why they choose your product.
Here immediately find an important difference with the regular Business Plan. Due to the focus of LEAN Startup on validation and understanding the customer and his problem, you are certain that you are solving an actual existing problem and that this problem is important enough for the customer to find a solution for it. You connect to the Problem Fit of LEAN Startup. Describe the results of the Problem Statement here and describe the 'who', 'what', 'when', 'where' and 'why'. More information about the Problem Statement can be found here.
Support the problem statement with factual information from the validation of the problem statement, so that you can prove its existence.
One of the crucial questions of an investor is whether you offer a solution to an actual problem. If that problem does not exist, then possible solutions are meaningless and therefore have no chance to succeed. Investors pay extra attention to description of the problem.
The Offered Solution describes the results of LEAN Startup's Solution Fit. What solution do you offer and how does this solution solve the customer's problem? Use the input from the Value Proposition of LEAN Startup for this. Support the Value Proposition with factual information from the validation of the value proposition, so that you can demonstrate the functioning of the solution. Describe which alternative solutions are available to the customer, describe what distinguishes your solution from other solutions and why the customer will choose your solution.