1. MHR 423 Creating the Business Plan Spring 2006 Dr. Stan Abraham MHR Dept.

2. Principal Course Objectives To understand what goes into, and write, a business plan for a new or emerging business needing financing To make a five-minute convincing “pitch” of that business plan One prerequisite MHR 320 or EBZ 306

3. Value of the Course Most entrepreneurs have no formal education in entrepreneurship Some even have no formal education! Many have never written a business plan Many are engineers, scientists, artists, or other professional that have no business experience or acumen whatever Epitomizes Cal Poly Pomona’s philosophy of “learning by doing” You will actually write a business plan and do a five-minute pitch for the business at the end of the quarter before invited guests (investors or other knowledgeable people)

4. My Expectations of You Take more responsibility for your own learning You won’t learn as much if you don’t Commit to having a very good group experience Your workload and stress level will increase exponentially if you don’t, and your grade will suffer proportionately Plan carefully and organize well There is a lot to get done in the quarter Pay attention to all deadlines Get started early

5. My Role as Professor To create a friendly and fun environment for learning To act as a resource, coach, expert, and sounding board for you as you develop your business plan To provide useful feedback at all times –Especially with your assignments To give mini-lectures on each topic based on my experience

6. The Business Plan Done in groups Based on a business idea you come up with Written in stages Improved through feedback from grading Experience putting the whole plan together –Everyone be responsible for the whole document Culminates in a 5-min. dazzling presentation before guests External Analysis (Individual) Financial Plan and Projections and other sections Marketing Plan Final Business Plan

7. Participation Grade (10 pts) Nothing happens until I know all your names (week 3) Attendance gets four points Remaining six points for asking questions and contributing to discussion during video discussions and final presentations –I scale all participation at the end of the quarter relative to the student that has participated most Each unexcused absence over two loses one grade point Six unexcused absences gets an ‘F’ in the course Eight absences of any kind also gets an ‘F’

8. Excused vs. Unexcused Absences An excused absence is when a student informs me about an absence for a good reason (Cal Poly event, family emergency, accident, job-related) –Could be ahead of time or after the fact Oversleeping or being unable to find a parking spot is not a good reason Absences include –Coming to class more than 20 min. late –Leaving more than 20 min. early –Sleeping for more than 20 min. cumulatively An unexcused absence is when I have no idea why you missed class

9. Grading Grade points are allocated as follows: External-environment paper……………20 Group marketing-plan paper…………..10 Group financial-plan paper……………..15 Five-min. presentation (group).………15 Final Business Plan (group)…………….30 Participation (4+6)………………………..10 Total……………………….100 Group grade is 70% of total

10. Group Contribution Rating Factor It’s patently unfair for students that “coast” or do poor or not enough work to receive the same group grade as others in the group –Group work comprises 70% of a student’s grade Students will complete a peer-rating- evaluation form at the end of the quarter –I will use those data to assign a Group Contribution Rating Factor (GCRF) to each student GCRFs > 1.0 will enhance a student’s group grade (they will have done more than their fair share of group work) GCRFs < 1.0 will penalize a student’s group grade (they will have done less than their fair share of group work)

11. Written Work First drafts must never be handed in I will not grade a first draft Always edit your work once, preferably twice Consider assigning someone this critical task Business writing is concise and clear If you find writing difficult, you must go to the University Writing Center for help Take pride in your work—a quality business deserves a quality business plan Final reports poorly written will lose points Ask questions about anything you are not sure of Revise sections based on my feedback

12. Videos and Discussion On each of three video sessions, I will show a video of two startup companies making a pitch to a panel for funding –After each company founder has appeared before the panel, the class will discuss which of them deserves the funding more –Then a final clip will be shown with the decision of the panel as to which one it considered better The experience puts you in the role of investor The class discussion part will earn you participation points, but is otherwise not graded

13. Learn from previous feedback… I will share with you feedback I gave to groups in previous classes on their Marketing Plan –Names have been removed to protect the innocent –The feedback may induce you not to make the same mistakes –You will note my feedback is constructively critical and more severe than the grades I gave Although I may not be so lenient now

14. A Final Word Past students felt tremendous pressure all quarter long to get the work done –So get started right away –Set earlier deadlines and stick to them –Allow enough time to edit your work Past students found the Financial Plan and Projections to be the most difficult –Come see examples of business plans in my office –Get help

15. A Final Word (cont.) A business plan has other sections besides the early drafts you turned in –Don’t forget about them Past students complained about most of the grade being earned through group assignments –You need the group to do the work –Make sure everyone in the group contributes This will be the most useful training experience you could possibly have as you prepare to start your own company –Short of actually starting it

16. Any Questions?