1. MIKE FERNANDEZ, EVAN MOORE, MICHELLE PARATORE Business Plan 101

2. Business plan MP Business plan outline Executive Summary Company Description Product or Service Market Analysis Strategy and Implementation Web Plan Summary Management Team Financial Analysis 1-2 pages highlighting the most important parts of your idea Keep it brief and captivating Brief description that could include ownership and startup plans For new ideas/companies, not much to write here Describe the product or service you are selling Focus on consumer benefits Focus on target market, unmet customer needs, how to reach customers Many VCs value this part the most Distribution and sales strategies and milestones, use timelines and budgets Here’s where those milestone memos come in handy! For e-commerce, focus on site map and technical development A working web prototype can help here Describe key management team members Remember David Hornik – some VCs care about this a lot! Some projected financial numbers – profits and cash flows VCs care about making money! Things to focus on for VCsKey Components

3. Business plan MP What VC’s look for Is it a big opportunity? - VC’s need one or two home runs for their funds to succeed Personal connection or domain knowledge? - What gives this team an advantage - Something that will keep the entrepreneur going during dark periods How much money is needed? - Use monthly burn rate to figure out how long the cash will last - Raise more than you think you need Be able to answer: how many users do you need to break even? - Costs are easier to predict than revenue - Order of predictability: Costs, User Value, Number of Users.

4. Business plan MP Financials

5. Business plan MP Drivers, metrics and tactics Drivers: assumptions you’ve made that drive your financial projections -Usually more interesting than the revenue/income forecasts themselves -Reveal how you’re thinking about your business -E.g., fixed and variable costs, total addressable market Metrics: measureable aspects of the business that, if achieved, create value, e.g., -Provide concrete insight into the organization’s plans -E.g., customer count, number of locations, number of distributors or resellers, unique visitors, page views Tactics: the specific actions you’ll take to achieve the key metrics

6. Business plan MP Thinking like a VC: sample pitches We’ll hear two short pitches from entrepreneurs (both graduating GSB students) You’ll have $60K which you can use to fund the entrepreneurs -Your choices are:  $60K and $0  $40K and $20K You can ask questions to the entrepreneurs after their pitches to inform your funding decision