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Get your business plan together (or said another way: Do I even need a business plan?)

Most VC firms require a solid business plan before considering to back a start-up company, unlike angel investors who may be more informal and quicker to make a decision. Before building a large masterpiece of a business plan, it is probably best to create a succinct one-page executive summary that clearly states:

  • a company’s product or service
  • the entrepreneur’s background
  • market opportunity
  • the entrepreneur’s vision for growth
  • why funding is required and how it will be used
  • business model that explains revenue streams
  • competitive analysis
  • sales projections

There is debate within the entrepreneurial and investment community as to the utility of business plans. Some view them as a waste of time who feel the time should be spent building your product, talking to customers or selling. Some view it as a good exercise in planning and shows commitment and clarity of thought and vision.

Again, it is worth remembering that venture capitalists are individuals and so they’ll have different preferences. An executive summary is a critical element to have for any venture capitalist. It is also a good discipline to get your thoughts collected in one place as it makes communicating your idea easier.