Incorporating and utilizing what the experts recommend

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“It’s fine for the Fed not to have a rigid plan—it’s even good—but your company needs a plan.”

(Forbes, 2013)

In the previous post, we discussed the critical and key components that investors are looking for in a business plan according to industry experts: Mark Cuban and Dr. Steven Gedeon. Now that the recommendations have been analyzed, it is time to incorporate what business students have learned from their own research on the experts previously profiled. For a business plan that is focused on a large-scale concert venue, these are the recommendations that can be incorporated and utilized: make sure to specify how much equity the investor will receive or how they will get a return on their investment (Cuban, 2013). When writing a professionally formatted business plan, the investor must walk away with a clear understanding of how long it will take them to get a return on their investment and how much equity they are receiving. They will also want to see a clear exit strategy: a way to make a profit and move on to the next deal. Business students have reformatted their business plans and made specific changes based on the information provided by the experts which include: beefing up their executive summary, and focusing on the needs and desires of the investors solely.

Understanding what the business is, and whom you are selling to, is an integral part of the business plan description for target markets (Scrhamm, 2012). Investors want to know exactly whom a company has targeted as their main market. Meaning who is the product or service targeted towards, and who actually buys it for that target market. The most important sections of a business plan to an investor reading your plan are considered to be the executive summary, management section, and the financials.   

What do industry experts say about business plans today?

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Mark Cuban is an American businessman, philanthropist, and disciplined investor who is also recognized as an expert in reviewing business plans. This entrepreneur comes from the world of business plan development and venture capital investing. Mark Cuban has been engrossed in the art of business dealings since the energetic age of 12, and by his senior year of high school opted out and enrolled full-time at the University of Pittsburgh. Cuban later transferred to Indiana University and graduated from the Kelley School of Business with a bachelor’s degree in business administration. According to entrepreneur and billionaire investor Mark Cuban, the critical and key components that investors are looking for in a business plan include (Blog Maverick, 2013): 

•       Demonstration of part of your business plan that you sell   your product or service for more than what it costs you to produce, fully encumbered
•       Must have a cash flow break even within 60 days
•       Must be profitable within 90 days
•       Everyone must work. The organization is completely flat. There are no employees reporting to managers. There is the founder/owners and everyone else.
•       In a business plan, make sure to specify how much equity the investor will receive or how they will get a return on their investment. 

These components are considered key because they encompass the very basics of a good business plan strategy. Business plans serve as the framework for a company and provide benchmarks to see if they are reaching the specified goals (Forbes, 2013).

Dr. Steven Gedeon is one of the utmost experts on the value of a business plan, as well as business writing and reviewing. Currently, Dr. Gedeon is a professor at the Ted Rogers School of Management in Entrepreneurship & Strategy. According to Dr. Gedeon, the critical and key components that investors are looking for in a business plan include:

•       Understanding what the business is, and whom you are selling to
•       What is the price point for the product and services the company offers
•       One of the most important components is the executive summary and what the qualifications of the management team are, as well as the overall business idea and the financials.

These components are considered key because it is important to know ahead of time to measure the effectiveness and to prevent a business from failing and making avoidable mistakes (Schramm, 2012).  
Dr. Steven A. Gedeon also emphasizes that the key elements to a successful business plan are whether or not it has creditability and if there is a guide to action.