Don’t Rush into a “Business Plan.” Many people will tell you that the only way you will get your idea supported is by creating a business plan. And, just as many others will tell you that no one serious about funding your idea will take the time to read a full 20 to 50 page business plan (at least not at the early stages.) – says Dan Dewine, the Founder of Workshops2Go training system for entrepreneurs and marketers.
Dan and I meet from time to time to brainstorm ideas. I am fortunate to consider him one of the many mentors I am lucky to have in my life at the time when I’m taking my business off the ground. Lack of a strong support network from family, friends, and mentors is often one of the early indicators – in my view – that a bootstrap entrepreneur would fail. Investors expect founders to bring in established network and support systems at the outset.
Dan is an inspiring business leader and marketing exec. With over 40 years experience in building and growing iconic brands, he built and designed, Workshops2Go, an innovative DIY training solution for entrepreneurs and marketers worldwide.
Check out my Q&A with Dan and leave us comment with an update on your entrepreneurial journey.
a business case … not a business plan
Business case, not a business plan. Says Dan. For start-ups in the early-stages, one of the best ways to challenge yourself and to make progress in validating if you really have a winning idea is to begin by developing what Dan Dewine calls a business case … not a business plan.
Doesn’t that run counter to the traditional advice for entrepreneurs?
There can easily be as many as 100-200 steps to consider if you think you are ready to develop a full business plan. The business case approach is enough work in itself if you are just starting.
The case approach says “Don’t try to provide all of the answers before you clearly know what all of the right questions are.”
I think it’s like someone who hasn’t been a distance runner deciding to do a marathon. They shouldn’t start with 26.2 mile training sessions.
As an alternative, the business case process challenges you to ask yourself 10 important questions to ensure that your idea will stand up and stand out. In the overall, your answers should collectively satisfy the bottom-line question about your venture … why should anyone care?
Done right, this interim business case step will get you attention with the right people. People (potential investors, employees, collaborators, customers) will be impressed to see that you have done your homework and if your idea solves a problem for someone. If they then want you to dig deeper, then maybe they will ask you to develop a more comprehensive plan. In fact, if your idea is good enough and makes it through their initial review, they may even help you do it.
In most cases, investors won’t look at your detailed business plan until you’ve created an elevator pitch, an executive summary, made an initial presentation and done some kind of demo of your idea/product.
[Tweet “Too many entrepreneurial efforts leap too soon in a “Ready-Fire-Aim” approach. – @Workshoops2Go”]
Newbieprenuer Pitfalls to Avoid
What is a common mistake that many “newbiepreneurs” make?
AWhen you hear the statistics about how many new businesses fail, it’s safe to assume that one of the primary reasons is that people move ahead with an idea that they think up, but don’t think through.
This is quite often true with technology innovations. So many of the people who have the great technical ideas have an engineering or science background. And, along the way, during college, their curriculums were so rigorous there was no time for courses in marketing, communication, business or entrepreneurship.
They are so wrapped up in their nifty technology that many of their ideas are actually solutions looking for a problem and the entrepreneur fails to perform the due diligence to validate that there is a real market for their brainchild. They can explain the widgets in extensive detail, but can’t give you a simple elevator pitch that capsulizes the opportunity.
It’s like the analogy of the person whom you ask for the time and they proceed to tell you how to build a watch.
How does the business case help an entrepreneur focus?
The business case approach breaks your planning into bite-sized pieces … logical and chronological … and working through the process will help you to organize your thinking and convert assumptions to knowledge by:
- Clarifying the opportunity
- Linking your solution to the problem you’re solving
- Defining, focusing and energizing your activities
- Evolving your thinking and your further planning
- Challenging yourself and your idea before others do
- Telling you if your idea is good enough to survive deeper scrutiny
10 Focusing Questions for Entrepreneurs
In simplified form, the 10 business case questions are among the primary thoughts that an experienced investor or customer will be thinking, so you will want to answer them up front as part of how you define your idea or venture.
Entrepreneurs think differently than everyone else. That’s why they’re innovators, risk takers, adapters and leaders.
This process helps you fulfill what I consider to be a key premise of entrepreneurship …
[Tweet “Before you become an entrepreneur, you need to learn to think like one. – @Workshop2Go”]
In the Workshops2GO Entrepreneurial Thinking module, I use the 10 questions as a stepping off point. Each question actually prompts several other clarifying thoughts to help the workshop user save time and thinking.
If you’ve been thorough and thoughtful in developing your business case, you have a good foundation for working toward your business plan (if you ever really need one.)
So, the first question is really an important test because if you are not solving a problem for someone, why would anyone care about your idea, so you probably don’t have a viable business.
#1 What is the problem you are trying to solve?
#2 How are you solving the problem?
#3 Who are you solving the problem for?
#4 How is your solution different from what is already available?
#5 Why will they be willing to pay for your solution?
#6 Who are your competitors?
#7 What are your primary challenges?
#8 Who are you and your team members?
#9 What is your elevator pitch?
(read on to get the last question)
Getting attention and interest in your business case starts with your elevator pitch. Simply defined – the elevator pitch is how concisely and accurately you tell the story of your idea in the time it takes to go from the bottom to the top floor on an elevator. It’s an extremely important discipline to develop. Remember that you only get one chance to make a strong first impression.
Being able to develop this discipline and skill of presenting is an essential part of how you will interest people in your idea – especially busy people with whom you may initially get only the briefest time to present.
Just remember that details do matter. While the pitch should be brief (ideally about 90 seconds to two minutes), your challenge will be making it informative, interesting and compelling. Don’t be fooled by the 90-second brevity as being too easy. Mark Twain once opened a letter to a friend by saying something like, “I’m sorry I am writing you such a long letter, I did not have enough time to write a short one.”
10 guidelines for an effective elevator pitch
#1 Tell a story – Create a beginning, a middle and an end
#2 Answer “What’s in it for them?”
#3 Less is more – keep it simple
#4 Talk, don’t read
#5 Understand the setting
#6 Keep thoughts crisp and brief
#7 Smiles are audible and contagious
#8 Body language speaks loudly
#9 Practice. Practice. Practice.
#10 Always say ‘Thanks!’ and ask for the order
If you can fashion and focus the talking points of your idea as an explanation that concisely and consistently answers the first four questions of the business case exercise – with clarity, logic and enthusiasm – you are well on your way to creating an effective elevator pitch and moving your idea from concept to reality.
Key question #10 … What is your next step?
Don’t give up too easily …
“A pessimist sees the difficulty in every opportunity, an optimist sees the opportunity in every difficulty.” Sir Winston Churchill
What you do next is critical.
Remember, ideas are everywhere.
It’s the execution of good ideas that makes for successful ventures!
Through Workshops2GO, Dan Dewine leverages 40+ years of experience with broad and deep knowledge, insights, ideas and success as a marketing executive, ad/pr agency principal, market researcher, C-suite speechwriter, copywriter, events planner, marketing and communications practitioner and consultant. His work spans numerous industries and Fortune 100s plus new ventures, universities and major not-for-profit organizations. He is a serial entrepreneur who has launched several successful ventures, taught and coached entrepreneurship to technological university students.