My Amazon.com Bestseller: 24-Hour Business Plan Template
This book is my second and most recent publication. In one sentence, it provides a clear and concise method for validating your startup ideas and planning your business venture. It also happens to be the method I used when deciding to leave my full-time job in early 2015 and open my own business.
Weighing in at just 93 pages in length, this book isn’t nearly as much of a monster as my first book about systematically hacking Craigslist for extra money. However, it’s an easier and shorter read and it comes with some free bonuses, like a pre-formatted business plan template, cash-flow spreadsheet, and a couple other goodies.
How to Validate Your Startup Ideas
The layout of the book is simple. In the beginning, there are a few short sections that cover “validation” of your business idea – which is something not enough new entrepreneurs are doing, unfortunately.
As I discuss in the book, I myself have fallen victim to this lack-of-validation mistake a number of times in my life (and it’s no fun!). Hence, my purpose with these initial sections is to save you from investing in an idea before you know if it’s even viable.
The 7-Step Process for Planning Your Business Venture
Next, you’re introduced to a systematic way of cycling through business ideas, compiling key information required to test them, and then validating them in a period of 24 hours. There are seven steps in total, and when you put them all together they add up to a nice even 24 hours.
The point of keeping this initial planning process short is simple: you don’t want to spend months and months crafting what you think is the perfect plan only to discover it’s not so perfect after all. That’s a lot of time to waste, and as discussed in the book, it’s something author Eric Ries also covers in his very popular book The Lean Startup.
How to Write Each Section of Your Business Plan
Finally, you are walked through each and every component of the modern business plan. Each chapter in the book represents a different section of the business plan itself, and in addition to showing you the required components for each section, detailed explanation is provided regarding how to think about these components and put them together effectively.
This latter aspect of my book is what I felt was missing from other templates I’d found online in the past. They would provide a basic outline for me to fill in, but didn’t always explain what each bullet point meant – and that would leave me hanging and confused at times.
Therefore, it was important to me to clarify these bullet points within my business plan template so that the inevitable questions (“What does that mean?”…”What’s an NAICS code?”…etc.) would be answered along the way.
Speaking of these sections, let’s talk about them in a little more detail here.
1. Cover Page
There’s not much to talk about here – the jist of your cover page is simply to make it look good and professional, of course. What I recommend in the book is to simply add your company logo and some basic title/subtitle information to this page, as one might expect.
2. Executive Summary
The purpose of your executive summary is to provide a brief overview of your entire business plan from 20,000 feet. It should be factual, upbeat/positive, and answer any common questions or objectives that investors might have when first viewing it.
The executive summary is also generally the part of your business plan that should be written last, after you’ve had a chance to make changes to the other sections. Frankly, there’s no point writing it in the very beginning.
3. Company Objectives
Your company objectives section will dive deeper into the heart of what your business is all about: things like your mission statement and company values should be discussed here, along with your specific business objectives over the next 1-5 years.
4. Products & Services
The nature of your products and services section will differ depending on your business model. Many businesses and startups these days only have one core product or service, in which case this section can be used to dive into detail regarding its features and development process.
On the other end of the spectrum, there are other businesses that will host thousands of products and/or services. If you’re opening a grocery store, e-commerce website, or something else revolving around merchandise resale, there’s a good chance you won’t be able to discuss each of your many products in detail. That’s okay – you can use this section to discuss your distribution channel and product/service market instead, and highlight the various categories of products you’ll be selling.
5. Customer Profile
In my opinion, this might be the most important part of your business plan – at least in the beginning. To understand your customer is to put yourself in a position to make sales, so you’ll need to know their demographic, where they obtain information about products/services like yours, and survey or interview them to gauge interest in your business.
My most direct knowledge of creating a target customer profile comes from my prior employment in sales (and even when I was working as a paralegal).
At the law firm I worked at for several years right out of college, our target market was large banking institutions. We represented them in foreclosure, bankruptcy, and evictions matters, and the partners of our firm spent their time arranging meetings with all of the big bank execs to land these accounts. It worked, and within just a few years my department had grown from 20 staff members to nearly 150.
At the promotional products and apparel company I worked at next, our target market was mostly SMBs (although we did also do work for some bigger names, like Coca Cola, Home Depot, even the CIA and the President one time!…). By focusing on building brand awareness through local trade shows, search engine marketing, and search engine optimization strategies, we were able to abandon traditional sales processes and focus on nurturing inbound leads through building personal relationships with buyers.
Notably, it made more sense to work with local breweries, restaurants, tech companies, and regional offices of larger companies than it did to go after “whale” accounts – which were frequently more demanding, less profitable, and harder to retain as our competitors were constantly calling into them.
At the registered agent and business/legal services company I worked at for a brief period after moving to Austin, TX, our target market was even more specific: any business that was registered to do business in 10-35 states (within the USA) was considered our “bread and butter.”
We’d occasionally close a deal larger than that, and we would also help new entrepreneurs get off the ground (these were small, 1-state deals), but we were most profitable when focusing on the companies in the 10-35 state range because they were big enough to do a high volume of business with us, but not too big – many of the really big companies registered in all 50 states (and internationally) were already deeply ingrained with our competitors, making it tougher to build those relationships and close deals. Hence it was far easier to close two 25-state deals than it was to close one 50-state deal, and you can understand why we chose to focus on these businesses.
With my current full-time business venture, our core product offering is software that streamlines the employee selection process to reduce turnover and increase retention. What we’ve found through our preliminary market research, in addition to discussion with our key strategic partners, is that our target market is any company with 200-500 employees.
This follows from similar logic to what I discussed above for the registered agent company I worked at for a brief period of time. Companies that are much smaller may not need (or think they need) a sophisticated solution for recruiting, applicant tracking, and advanced job benchmarking/diagnostics. At the other end of the spectrum, very large companies are likely already addressing their turnover issues and implementing competitor solutions (not to mention the sales cycle is much longer at huge companies).
By focusing on companies that are in the 200-500 employee range, we hit companies who have grown to a size where they’re in need of a system like ours, but haven’t done much research on such systems or taken action to implement something yet.
The purpose of highlighting these real-life examples is simple: you can imagine how much time might be wasted if you bark up the wrong tree. With your own business, you’ll have to decide what demographic market and customer base is most likely to buy your solutions due to need. Whether you’re in B2C or B2B, and whether you’re target small or large accounts, it pays to understand who you’re going after so you don’t waste time with your sales process or marketing dollars.
6. Competitor & Industry Analysis
In my book, I spend quite a bit of time covering this section. That’s because it’s another high-importance thing to get a grip on when starting any new business or project.
In a perfect world, you’d come up with an original product or service that everybody needs and which has 0 competition. This isn’t likely, though, and depending on the type of market you’re in you’ll want to spend some time sizing up the competition.
The more competitors you have, and the more densely populated they are in your region and/or your marketing channels, the much more difficult it will be to “get off the ground” in the beginning – especially if you’re launching on a small or limited budget.
Similarly, the industry itself can present its own array of problems for new business owners. Maybe you don’t have many competitors, but your industry simply sucks – and there’s not much customer demand to begin with. This is why it pays to validate your business ideas in the beginning of your business planning process, rather than many months into it and thousands of dollars later.
7. Sales & Marketing Strategy
Having worked in sales (and to a lesser extent, marketing), I’ve had the privilege of seeing just what it’s like being on the front lines, forming new relationships with buyers and working with a variety of personality types to get business done.
What I always thought was crazy about sales (as a career) was how I could pick up an account that did 6-figures with my company each year by handing out one random business card at a bar, but then bust my balls contacting hundreds of other companies to barely scrape together half of that in the weeks or months that would follow.
Sales is a mixed bag (and so is marketing), and you just never know what’s going to work until you start testing and trying different things. One thing that’s certain, however, is that the more you “play the game” and put yourself out there, the more opportunities you have to succeed. Sales and marketing are both low-conversion games to play, so it takes persistence to get the job done.
There’s more information on this in the book, and if you’re looking for another resource I’d recommend grabbing a copy of a book called Traction by Gabriel Weinberg and Justin Mares – it covers 19 different “traction channels” that you can consider for generating customer interest and building sales.
8. Operations & Logistics
This is a part of your business plan that I might recommend you do towards the end, because it’s getting more into the nuts and bolts of daily operations. However – it’s still important to have an idea how your workflow will be setup, because it can make or break you in the end.
You need to know who your suppliers are, your contacts at their various location, who your distributors are (if applicable), and so on – anyone who has ever worked in purchasing, procurement, or logistics can tell you how much sh*t gets fu***d up due to a lack of planning in this area – even in established businesses.
Therefore, it pays to get the basics down before opening shop so you don’t find yourself screwed because a shipment didn’t arrive on time, or because a key contract wasn’t in place that needed to be prior to closing a major investment round.
9. Management Structure
This section can be left simple – you’re simply writing out the chain of command on paper, so to speak.
Many people will recommend that you don’t go into business with someone 50/50 because it can blur lines in terms of “who has the final say” – potentially leading to gridlock and compromising business progress. However, as long as you have a clearly delineated management structure (who has the final call on what types of decisions), then you can typically get by alright.
The key is to ensure everyone (founders, partners, investors, etc.) have a clear understanding of who’s calling what shots and when.
10. Business Capitalization
Your business capitalization section outlines the funding strategy for your business. Some business will require more up-front funding than others (an inventory-based business might need lots of money to get started, whereas a consulting firm not so much) – the point here is to simply articulate how and when funding will be achieved.
Whether this is done through private investment by the founders, venture capitalists, banks, grants, existing businesses, or other institutions, it pays to get a handle on your startup expenses and determine how they’ll be covered for your first few years of operation.
11. Financial Plan
Your financial plan goes into more detail regarding the management of cash flow, assets, and liabilities throughout the initial growth of your business.
You should additionally insert a personal financial plan into this section, even if just for your own reference: how will you cover your living expenses and pay your bills while your business gets off the ground, exactly?
After all, here’s no sense getting all of the other details of your business worked out only to realize you won’t be able to participate because you don’t have a plan for covering your personal overhead.
Launching your business
Like I mention in the book, your success ultimately lies in your own hands when actually launching your business – and it will likely take more than 24 hours to get it off the ground when it’s all said and done.
But at least you can cycle through your ideas, test them, validate them, and put your plans together in a short span of time up-front – giving you additional confidence when you do make the decision to proceed with a particular plan.
Remember, it doesn’t pay to be a perfectionist in the beginning. You could all too easily spend months working on a plan that never sees the light of day, or wind up with poor validation when you finally get out there to solicit customer feedback.
Nor does it pay to rush forward too quickly without validating your ideas first. In this case, you wind up spending months and months in product development only to realize nobody gives a crap about your idea, much less will they pay for it.
As for this latter point, as a musician I’ve run into this more times than I’d care to admit – we spend all of our time in “product development” writing songs that we hope people will like, without ever spending time up front asking people what they’d like to listen to. Our narcissism tells us our unique, individual creativity is all we need to succeed, but in reality there’s much more to the equation than that (if we want our music to be liked, appreciated, and purchased, that is).
The same can be found in many new startups, unfortunately, and is one reason you really need to spend the time, effort, and money validating your business idea up front. Otherwise you might wind up pretty frustrated when you’ve poured your heart and soul into something nobody is responding to…
With that said, please let me know if you have any comments or feedback – I’d love to hear from you!