A Proper Plan

David Lavinsky
President, Growthink

Growthink is a company that has created over two thousand successful business plans. They have worked with a number of different clients since they began in 1999. Each of Groupthink’s clients have continued on to become incredibly successful, raising more than $2.5 billion in funding.
David begins naming two reasons why companies create business plans. He sates that the first is to “determine the optimum strategy and game plan to grow their business.” Of course, the second is to raise money.

He discusses that most business plans actually fail to raise money, stating that venture capitalist fund less than 1% of the business plans they see, while Angel investors only fun about 11%. With the state that the economy is in, it is becoming harder and harder to raise money for your business. He shows that most business fails within 5-10 years and only 3.9% actually make it to one million dollars while only .6% make it five million.

However, some companies continue to thrive due to their strong business plans. Growthink has five attributes that separate successful business plans from others.

Growthink’s Five Attributes:
1. The Right Overall Value Proposition
• It is imperative offer a product and/or service that consumers actually want
2. The Right Marketing and Sales Strategy
• Marketing and Sales plans must be incredibly detailed
3. The Right Business Model
• According to a study at MIT, your business model takes priority over your industry
• Think of all the possibilities
4. Action Plans Developed from Reverse Engineering Success
• Think about where you would like to be in the future, five years from now.
o Where will your business be?
• Revenue, Profit, Sales, etc.
o Reverse Engineer
5. Communicate Brilliantly
• You need to effectively communicate
• Any strategy is useless if it is not understandable
• Think about your audience and who you are marketing towards

Theo Afkoudias
Theo states that Strategy is the backbone of the business plan; but, before you can have a good strategy you need to do a good analysis of yourself and your business and even an external analysis: competitors, industry, market, etc.

Resources:
http://www.growthink.com/businessplan
http://www.youtube.com/watch?v=Aydy3Pv-rCM