The “one page” Business Plan Before we begin: What stage best describes your business venture. Ideation Pre-planning Start-up/launch In existence for less than 1 year In existence for 1 year or more “If you fail to plan, you plan to fail” Benjamin Franklin

Planning Methodology The classic business plan “A long Winded Guess!” The one page business plan Business model Canvas (Alex Osterwalder) Lean Canvas (Eric Ries – Ash Maurya) Planning Methodology

The Lean Canvas The One Page Business Plan Simpler, faster, easier to both create and understand

Lean Canvas Version 3 9 4 1 2 8 5 The lean canvas helps you think through the following questions: 1. Who is my customer (Demographics and Psychographics) – that is who are they and how do they think 2. What is my product/service – what is the problem my business is trying to solve? What is the solution - how does it solve a customer problem? How is it unique – what prevents others from doing the same thing? 5. How am I going to find my customers? How will they find me? How will I deliver my product/service? 6. How many different products/services will I offer? 7. Can I make money when I’m done? 7 6

Customers Who will we serve? Amazon People who buy Books Who will benefit most? 1 Amazon People who buy Books Demographics who are they - age, gender, population density, geography, income level Psychographics – how do they think? Political affiliation, values For purposes of illustration, let’s assume we were Amazon in 1994 when it started: Target customer= “People who buy books”

2 The Problem Top problems customers face Unique needs and challenges Existing Alternatives How else can customers address the problem? Products or services that already exist. (Research your competition) 2 A business solves a customer problem. The more dire the problem, the more the customer will pay. … and the more competitors you will draw Key word is “Unique” Amazon example problem: Bookstores are expensive; they have limited inventory/selections; hard to find books and get recommendations at bookstores Amazon alternatives: Bookstores, catalogs, book clubs – these options didn’t really solve the problem very well Amazon Problem Bookstores are expensive Limited inventory/selection; Hard to find books/ get recommendations Alternatives Book stores, catalogs, book clubs

The Solution How you will solve the problems Top features and capabilities of your product or service What aspects of your offering will users find most beneficial? 3 How completely does your solution solve the customer’s problem? In terms of time, place, features, - even better if add-ons Amazon example: Earth’s largest bookstore Describe the high-level concept: “Supermarket of bookstores….on-line” Amazon Earth’s largest bookstore Supermarket of bookstores…on-line

1a Customers Who will we serve? Who will benefit most? Early Adapters Who will be the first to buy? 1a Refine the customer base to those who are early adopters – the “perfect” customer. Amazon example: “Avid book readers that are using the internet; willing to make purchases on-line, and like to explore books” Note: sometimes you may need a separate lean canvas for each customer segment you’ve identified Amazon Avid book readers using the internet Willing to make purchases on-line Like to explore books

3 9 4 2 8 5 7 6 Lean Startup Begins here 1 Make sure this foundation is realistic before you proceed any further. Don’t just plan it - test it with family, friends, potential customers 7 6

Lean Startup Theory Get out of the Office “No plan survives the first contact with a customer” You are not smarter than your customers Develop a “Minimum Viable Product” Sitting on your behind analyzing “what if” does not result in the most important feedback of all: The customer’s. Make the assumption that you do not have the answer? Try it out – pilot the idea with family, friends, potential customers to refine/get it right Get out of the Office

4 Value Proposition Why are we different? Why are we worth buying? Special benefits to the customer? 4 Amazon Website that sells all books available Web-based customer reviews Ship direct from warehouse Efficient warehouse? Amazon example: Website that sells all books available; web-based customer reviews; ship direct from distributor; efficient warehouse? What if it’s a home business – a service? How will you be unique?

5 Path to customers Where do we sell? How do we sell? Channels Path to customers Where do we sell? How do we sell? How do we raise awareness? How do we get feedback? 5 Amazon example: Direct to customer via a website; email marketing Amazon Direct to customers via website eMail marketing

Revenue Streams Amazon 6 What are your sources of income? Book sales Sales, Service, Usage, Subscription, License, Delivery, Installation 6 Amazon Book sales Shipping Fees Amazon example: Book sales; shipping fees;

All Variable and Fixed costs Cost Structure All Variable and Fixed costs Define Determine (price) 90 % of new businesses fail because they do not properly consider the cost of launching and operating the business 7 Amazon Website developers, data center staff, servers, customer service staff & equipment, books, shipping costs This is the number one reason small businesses fail. Don’t go through all the effort of getting ready then overlook this step. Amazon example: Website developers, data center staff, servers, customer service staff and equipment, logistics & fulfillment staff; books and shipping of the books SCORE templates: Business Startup Expenses /12 Month Profit and Loss Calculation

Key Metrics Amazon 8 Key activities to Measure Determine how well you are doing 8 Amazon Sales conversion/visitor Average sales/transaction Total sale transactions/total visitors What gets measured, gets done. Sales/revenue, profit, time to market – helps you determine if you are on-track (or off the tracks) Amazon example: Sales conversion per visitor, average sales per transaction, total sales to total visitors ratio

Unfair Advantage Amazon 9 Can’t be copied or bought Patents/Licenses, Reputation, Location, staff skills. 9 Amazon Unlimited book selection Great prices Superior customer service This is how you keep competitors at bay. Amazon example: Unlimited selection of books at great prices and superior customer service = first mover advantage

Write a Business Plan Financial Projections to be Included Startup Costs 12 Month Sales forecast 12 Month Profit and Loss 12 Month cash flow projection Opening Balance Sheet

Write a Business Plan The Executive Summary Basic Highlights of the Business Concept Convince the reader that: There is a market for your product/service You can manage a business The business can be profitable The lender will recover their funding The investor will be rewarded

Lets Wrap Up Questions? or Comments!

Achieve Your Goal