"The Business Code" by Dan Brown

Nine out of ten investor groups and lenders say the majority of business plans they receive do not provide the information needed to match their funding criteria. Too often boiler plate or plans using a general template are submitted. Many make the mistake of viewing a business plan as nothing more than a creative writing exercise that can be completed in a few days; a one-time document or something to be done cheaply and quickly to attach to a loan application or give to potential investors. res ipsa loquitur (Latin for "the thing itself speaks") ... the "facts speak for themselves." A Small Business Administration (SBA) study revealed that the degree of business success is proportionately related to how comprehensive and detailed the business plan. The number one reason businesses fail is lack of capital. I maintain lack of capital is experienced due to poor or insufficient business planning. A US Bank study of failed businesses determined the num...

While there are many lists available as to why you should have a business plan there are basic reasons you need a business plan: To get a loan for your business. Banks, the SBA, and investors all require a business plan. I’ve never heard of anyone getting a business loan without a business plan. To get investors. VC’s, Angels, and private investors all require a business plan. I’ve never heard of anyone receiving an investment without a business plan. A road map to run and grow your business A proper business plan will define operational and growth milestones. Your business plan should set out the “road map” for you to follow to business success. Your plan allows you to make sure everyone is on the same page and be proactive in response to market changes. The old adage still applies, “the only people who need a business plan are people starting a business, people buying a business, people selling a business, people who own a business. If you are thinking about or in bus...

I am often asked what is the value of my business or how much ownership do I have to give up. Too often a potential client insists their business is worth millions and investors would be falling over themselves to rush to give the business owner millions for a few percent ownership. There are thousands of pages written about how to value a startup or pre-revenue company. Before proceeding with yet another page on how to value your startup I’ll give you the simple answer. A business, like anything, is worth what someone is willing to pay. For owners valuing their business is often an emotional exercise. For investors it is a logical exercise in math. Each business sector has an accepted multiple to set the value for companies generating revenue and profits. Depending on your sector the multiple is either times revenue, EBITDA, or profit. E.g. at 3 times revenue, if you have $1 million in revenue your business is worth $3 million. If you have revenue and no profits usually the...