September 25, 2018

Is the Business Plan Dead?

Every so often journalists proclaim that the business plan is dead. UAT Business Technology Program Champion Dr. Mark Smith agrees that startups need to do more showing than telling, but says that business plans or proposals “are certainly not dead and are used in pretty much every business venture.”

What’s different about today’s business plans? According to Dr. Smith, “They just aren’t emphasized as much. But no matter how well the presenter pitches their product, they will still face a scrutinizing vetting process. Business plans help venture capitalists and investors visualize the person’s pitch and help them make sound funding decisions.”

Overlooking or outright dismissing the business plan can be detrimental to startups. “New entrepreneurs make several common mistakes with the business plans, including not being detailed enough with costing, not doing enough market research and not knowing their audience,” Dr, Smith said. These shortfalls can add up quickly or event lead to failure.

Trying to launch a technology startup? Your business plan will look similar to proposals for companies trying to grow and gain investment opportunities in other industries. “The only difference when pitching an emerging technology is that it might not be highly sought after, so you’ll have to create the demand,” Dr. Smith said.

Investors may also view startups pitching new tech as a higher risk, so these businesses will need to put in additional time and effort into their research to showcase how their specific technology will lead to long-term profits. “And they’ll have to do it in terms that non-technical people can understand and appreciate,” Dr. Smith adds.

 

Video: LivePlanVideos

 

Students and young startups can lean on business planning software when getting started. Some of the best options include bizplan, LivePlan and PlanGuru (but don’t trust anyone who self-identifies as a “guru”!).

Want to study business and technology? You can request more info on our Business Technology degree program here.

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