Pick a Plan, Any Plan

I'm fortunate enough to have not only a friend who writes business plans, but another friend who was a commercial lender. Thus I have friends on both the author and audience side of business plans. I myself am no expert on business plans, but these friends have given me valuable insights into what they must include to be effective.

My retired commercial lending friend recently suggested that one approach towards pitching a product to investors is to put together a simple, straw man business plan before spending too much time and effort fleshing it out. The idea is to put forth the basic value proposition and projections and use it to get feedback on how to refine it.

Of course, you will need to do some market research to end up with a compelling and credible plan. To some extent, the nature of this market research may depend on feedback you get from presenting your straw man business plan, however. So how do the business plan and the market research fit in with each other, given this cart-before-the-horse problem?

The answer is to iterate on both your market research and your business plan. Compose your business plan at the same time you hire a skilled product manager to research the market. Write the skeleton business plan, fleshing it out iteratively as the research findings and data collect. Start with formulas and metrics and plug guestimates into them, then put "real" numbers into it as data accumulates from the research.

Comments

Dancer Test

Are you left-brained or right-brained? Supposedly, your brain lateralization determines how you view this animation. Some people see her rotating clockwise. Others see her rotating counter-clockwise. Some see her unpredictably changing the direction of her rotation. Supposedly, people who see clockwise rotation are right brained. People who see counter-clockwise rotation are left brained. I originally came across this animation here .

Why Spreadsheets Suck for Prioritizing

The Goal As a company executive, you want confidence that your product team (which includes all the people, from all departments, responsible for product success) has a sound basis for deciding which items are on the product roadmap. You also want confidence the team is prioritizing the items in a smart way. What Should We Prioritize? The items the team prioritizes could be features, user stories, epics, market problems, themes, or experiments. Melissa Perri makes an excellent case for a " problem roadmap ", and, in general, I recommend focusing on the latter types of items. However, the topic of what types of items you should prioritize - and in what situations - is interesting and important but beyond the scope of this blog entry. A Sad but Familiar Story If there is significant controversy about priorities, then almost inevitably, a product manager or other member of the team decides to put together The Spreadsheet. I've done it. Some of the mos...

5 Ways Companies Make Product Decisions

In the last blog entry, we reviewed the four problems that companies face, or are trying to overcome, as they make product decisions . Now we'll look at the ways that most companies make their product decisions. Companies that develop, market, and sell products and solutions make strategic and ongoing tactical decisions. They decide what features to include in their products, what messages they will use to communicate the value of their products, what marketing tactics they will use, what prospective customers they will target, and many day-to-day choices. Whether or not these decisions are deliberate or ad hoc, most companies use some combination of the following ways of making product decisions. (A downloadable "map" that summarizes the product decision landscape is included at the end of this article.) Customer Wants Product decisions based on feature requests, focus groups, and what prospects and customers say they want. Companies are selling products to ...

Cauvin

Search This Blog