Confessions of a VC 2:21 of the Business plan

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Entrepreneurs, business plan is your stepping stone to find VC. Not a piece of weight of the door, afraid you can not open the gate of VC.

This world is always to want money people more, can give out less money, gruel, financing is a threshold. If there is no

A weighty business plan, you can not enter the VC door. And every VC table has a mountain of business plans,

So your chances are limited, you are facing a huge challenge, the key is to be able to stand out from the crowd.

Note: Don't get me wrong, move VC, never a business plan can do, business plan book can only help you open the door of VC, after the door of things are very much, but also rely on your continued efforts. Today we'll tell you one thing: how to write a weighty business plan to hit the door of VC.

Frankly speaking, a considerable number of entrepreneurs overconfident, they do not understand the way of thinking of investors, that VC are some blind to give money to the suckers, as long as the Kan, to cheat will be able to get cash. No, there are three major types of business plans that I receive in My computer's mailbox every day:

A) Large row of stalls

It is estimated that in the Internet café spent a quarter of an hour to complete, shabby to the poles, white bottom black word ppt, a total of not more than 10 pages, remove the first page title and the last page of "Thank you!" Outside, there are 7 pages that are copied from the Internet and sticky about "WEB 5.0 will change the way we all live ... iresearch predicts that by 2050, China's Web5.0 market will reach 500 billion ... We will be the biggest gateway to China's Web 5.0 ... "plus a page that costs 50 million dollars for a consumption list." After inserting the appendix to the Business plan, the entrepreneur added a few words in his email, "No business plan has been written before, search on the internet, said it is a business plan in the company's current financial situation and the composition of the staff to do detailed introduction, we are still in the planning stage, funds in place, we can start immediately, Can we have an interview with you next Monday morning? "

Brothers, it's not that I don't like the simple style, it is not that I do not want to meet you, but you do not give me enough useful information, I can not determine whether this project is suitable for our investment, if each entrepreneur to write a white stripes come to meet immediately, my office will probably squeeze into the labor Bureau of the petition room, I can't receive it from morning till night.

B) Essay Class

With a lawyer or financial advisor hanging on the internet to solicit customers of the type of "Business plan Template", wrote Yangyang 80-100 pages of text ... Imagine the proud look of entrepreneurs in front of their emails: "Is this business plan serious enough?" I've spent so much time, are you embarrassed not to touch the money out of your pocket? It took me half a day to read it, and I found myself still confused, wondering where the core of the business plan was?

The brook is not deep, but the fish is clear. A business plan is not written much or less, and even if you write every chapter in detail, the key content is vague and I'm afraid it will be a white job. I believe that there is a part of the entrepreneur is a lucky mentality to take a chance, thinking that more text, length, seemingly serious attitude can muddle through to VC money?

C) carefully packaged solid steamed buns

There are some business plan is to ask the graphic designer carefully designed typesetting, coarse look at a glance will be a bright eye, but repeatedly read several times, in addition to the exquisite ppt screen, or can not find substantive content. Like a hungry when someone on the end of a steaming steamed meat dumplings, eat a half-day found that the original inside is full of solid, where is the meat?!

I believe that every VC is very serious to treat every potential project. Very few have a VC in the Business Plan stage fooled, VC make mistakes, most of the investment after the risk management, rather than investment before the analysis and judgment. VC's skill is to see Business Plan book, you tell the real business opportunities or in the fabricated nonsense, VC are all eyes.

Or a word, business plan to the main points of a project clearly, do not care about typesetting, art design and rhetoric words, to explain the matter clearly.

Simply put, VC in the business plan to see the three main points and evidence:

1. Who are you, positively?

2. What are you going to do (what)?--what is the value of your product or service?

3. How to do it?--whether you have the ability to execute and succeed.

No one will ask you to write a business plan must be perfect, but between the lines, VC can see whether you sincerely seriously, whether Kung fu to do, the seasoning plus foot. Of course, you're not a professional investor, you might miss some of the essentials, something you might not think is important to me. As long as VC is interested in your project, even if there is something missing in your proposal, most VC will come to communicate with you and even try to help you. To improve the efficiency of our work, entrepreneurs should understand and respect the way VC works, try to write a perfect business plan, do not play Tom and Jerry's cat and mouse game.

The effective business plan covers the following 21 areas, including the "Seven basic elements", the middle "seven essential elements", and the last "seven recommended content", together with 21. For the convenience of memory, let us play the "21" of the business plan.

"Seven basic content"

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1) Project Introduction (Executive Summary)

One-page "Project Profile" is the most important and challenging part of your business plan pen. Like a TV commercial, if it doesn't get the audience's interest within 15 seconds, the viewer will change the channel by the remote control.

Although "Project Profile" is like a "mini version" of your business plan, it does not include every aspect of the business plan.

Use a sentence to clearly describe your business model-your product or service;

Use a sentence to clearly describe why your innovation in a timely manner to solve the problem of users, fill the market vacancy;

Use a word (including specific numbers) to describe a huge market size and potential prospects;

Summarize your competitive advantage in one sentence;

Use a word to describe you and your team as a "dream combination";

In a word (including specific numbers and time) to outline how you will be in the shortest possible time to make investors profit;

Use a sentence to state how much money you want to melt and what it is mainly for.

2) Product/Service

Products and services are your business models, in other words, what does your company rely on to make money?

Don't say "we're going to be the biggest in China ..." and don't say that you are "the best, the best, what ..."

I believe you are ready to start a business, you will have a special idea of this content, confident to say it out, more specific details, I am all ears.

3) Market

The market can be seen from three aspects: macro, micro, and how you develop your own market.

Macro: You can get macro market data such as the free Report from the Ireaserch website, which is enough information, VC most of them are clear. What is important is the market data directly related to your product, that is, your micro-market, the market you are capable of, the more detailed the data the better. Even if you do not have these data VC will go to find, you have a "sense of service", it is better to do the work of VC first to do, so you get the money time may also be ahead.

Then, you have to explain how you can effectively do the market, do not venture to say you need 10 million to do media advertising to build corporate brand ... Start-up companies do not have the money to play those luxury games, you might as well say "we have agreed with Lenovo, through their channels of bundling in the national promotion ..."

4 competitors

I don't believe in any company that has no competitors.

For example, you developed a new energy-saving air-conditioning, VC will go to the industry boss to inquire about, such as to see whether Haier has similar products, or ask Haier why they do not develop such products, and then let Haier talk about the views and views of such products.

If the competitor is also a start-up company, don't be afraid, you should do better than them, as long as your product is more advanced than the competitor, we will support you, then maybe we have to buy the opponents, this does not solve the problem of competition?

5) Team

For Tsinghua, Jiaotong University and other famous school graduates naturally this is a once-in-a-lifetime opportunity, turtles are no exception, even in the Western Hemisphere in a remote town in the school only a few days, so can also be in their own face. Everyone's work experience is also important. Oh, if you've worked in big companies like Google and Microsoft, people might have imagined that you were about the same level as Sergei and Bill Gates. The sad reality is that we always judge one's ability by the label of each person. However, often the most interesting thing to me is those who get into top universities with honors, then repeat, skip school, drop out, and learn, like Bill Gates and Macdal, who often have strange things in their crooked minds.

If you have neither entered a prestigious university, nor worked in a well-known large company, do not have a sense of loss. You'd better not say "I'm experienced, I worked in a company ..." You can dig out your real talent, what you are studying, what you have been in the company, what you have done ... The team is VC investment object, but also VC focus on the content, remember in addition to packaging yourself, don't forget to put your team members are also introduced in detail.

6) Milestones

Creating a company is like building a tall building, when the foundation is completed, when the cap is capped, and when the turnkey is the key node in the project.

For the early startups, I'm most concerned about when the company's products can be successfully passed through a variety of tests to the market? When did the company's account start to come in? When did the company reach break-even?

Of course, flat is not my ultimate goal, the company income and expenditure is flat, I have confidence to give you more money to expand the scale, to further development. Entrepreneurs should understand that no matter what kind of company you create, the sooner the balance of the books is the better. A company starts earning money, the company's products have market value, a company profit and loss, indicating that it has a profit potential; only the company with profitability is really valuable company, so there will be more VC will favor you, send you more money.

Think carefully about every important step you will take, and identify every important time node in your company's path to success and brilliance.

7 Financial Planning

Financial projections are one of the most important parts of a business plan. But in early startups, this is the most overlooked aspect! The financial plan for early-stage entrepreneurship is a theme that can be used for three days and nights, so let me make a separate confession another day. Here are just some tips:

In addition to having a general introduction to the financial plan in PPT, VC will always require detailed Excel files for interested projects. Remember: At least 3 years of financial planning, preferably 5 years, focus on the first year. Write clearly three sheets:

--Hypothesis (assumptions)

--Income forecast (income Statement)

--Cash flow statement (Cash flows)

"Seven essential Elements"

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The above seven items in fact you to the customer to see the company's introduction is similar to write. But the business plan is for your investors to see, not to the customer to see the kind of company profile, the reader is different, content, positioning, writing, requirements are not the same. The following seven items are cast

The special interest and sensitivity of the people.

8 Ownership structure

You're going to drag me in as a shareholder, and don't want me to know who I might be working with or even bedfellows in the future? I must ask you this question sooner or later, why don't you start out on the tray?

9 The company's organizational structure

This question has two layers of meaning:

(a) Where is the registration of the company? which subsidiaries, subsidiaries and affiliated companies are registered overseas or domestic? Where does the investor's money come from? The structure of the company is related to how shareholders ' interests are embodied, and you'd better draw a chart to make it clear.

(b) How does your company work, and what departments do you have? Do you have COO, Sales VP, Technical director are clear division of labor, position? Or are you the Chairman, the CEO, the CFO, the system architect, the personnel director ... A feudal lord with power in one? You'd better provide a detailed chart.

10 The current investment of the company

If you have such a grand vision, how much money have you invested in your startup? If you don't have a penny, VC will often be very skeptical of your own confidence and entrepreneurial attitude towards the startup project.

Don't be afraid of losing face, if you tell me that you have invested only a few dollars in your savings but have done a good job in your career, I will never think of you as shabby, but as a hero. I will be assured that a lot of money to you to take care of, but also will repeatedly look after you, my money as your own money to spend, do not take it to a point of fire.

11 Contracts and Orders

Whether it's a donkey or a horse, you'd better have a contract, letter of intent, or order. Let me see.

12 Income Model – clear, credible, clear, accurate, visible income model (!)

For a start-up, nothing can be more important than income.

Do not say to me, you are a person who can make a lot of money, do not care to earn so few pennies. I'm just the opposite of you, I never count on whether I can eat pork in the next year or not, I only care if I can have a small bite of rice before I go to bed tonight. I don't care if you can be a billionaire in the future, you certainly will, my biggest concern is when you make your first dollar.

You may know that I am a bungee in the Valley of Death, and the first money you earn is important to me because it can buy you and my life-saving straws!!! Tell me honestly, how did you get your first dollar, where and when?

13) Valuation

This is also an unavoidable problem for entrepreneurs and investors. How much money do you need? How much do you want to sell? No matter what your psychological price is, you should make sure you ask for it as a starting point for negotiation.

14) Funds use

Even if you have detailed financial forecasts, it is recommended that you have a clear list of the major funding uses in your business plan.

"Seven recommended content"

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15 write business plan in the end is the form of Word or ppt good?

The answer is: no difference.

16 How many pages is the best way to write a business plan?

No limit to the number of words, the core points to understand the good, do not have to write more. Number of pages, 14 pages is enough to write a good business plan, plus a page cover, a page back (contact method), a total of 16 pages. In short, the contents of the above from 1 to 14 should be included, one can not be less!

17 How to find a VC, need not someone referral?

I find VC and someone referral effect difference, at most if it is an acquaintance of the business Plan, VC may find time to read it quickly, but for whether or not the decision to invest in this project, referral people do not have any role.

VC is a very small circle, you search online, in a few minutes you can find all the world's VC list. It is recommended that you never send a business plan to everyone in bulk. You'd better spend a little time doing homework: go to these VC websites to look at their respective investment direction and areas, the right remedy. If you're working on a biomedical project, send your business plan to a VC that is only for TMT, there's no return. In the final analysis, looking for VC to melt money is in the private market selling their company's shares, like selling any one product, to find their own potential buyers, do precision marketing. But be prepared to sell a start-up company shares and selling brain platinum is not the same, only a small group of people will be interested in your project, you do not dream of VC will be scrambling to break your doorstep.

18 can I have my financial advisor write a business plan for me?

The business plan is the mission of the core start-up team, the CEO's war plan, and I've never heard of General Patton's departure from the financial advisers. Usually a financial advisor is not familiar with your business, there is no operating experience, they can only be on your financial problems to do some answers and help, such as in the financial planning, if you are not familiar with the job, you can find a financial consultant to consult, but absolutely not to the business plan, financial planning, Even the financing of this event was contracted to the financial advisers. VC face is you, the investment is you, if you do not have a clear business ideas, complete financial forecasts, do not understand the financial figures and the organic relationship between your business development, you get the possibility of VC money is very small.

Suggest you use financial advisor, also want to put them in your behind the scenes, you and VC demo and negotiation, do not take your financial advisor let him (she) everywhere for you, become between you and VC a wind wall.

19 Do I have to take a lawyer to see VC?

Whether。 A lawyer's job is necessary after you receive a "Termsheet".

20 I send the business secrets to VC, will they steal my idea?

Ventured, gained. How come you don't have a little adventure like that?

Some entrepreneurs will ask VC to sign a confidentiality agreement before issuing a business plan, I do not know whether this is a sensible strategy or not, at least you will filter out a lot of VC, which is looking for your VC.

You are welcome VC you want to put forward such a request, people will hang up, cut off the following those trivial trifles. The polite VC will ask you to sign their standard NDA version, not the one your lawyer drafted for you. Some VC even expressly does not sign any confidentiality agreement.

Interestingly, I received a lot of business plans every day--not that I asked them to send them, but that they offered it to me, and that the cover was covered with a strict "confidentiality agreement," meaning I had to receive and see what was in it, and I was responsible for the problem. Luckily I am a good man and never steal anything. If you mistakenly sent to a thief's mailbox, it is not a treasure box sent to a thief in the front, while leaving the thief a note said: "You do not steal AH."

I dare say that most VC are well-behaved and decent professionals. Why VC is not willing to sign the so-called "confidentiality agreement", the reason is simple: this VC table has 5 solar energy project plan, if and a signed a confidentiality agreement, the result of investment in B project, a will the VC sent to the court to sue?

21 How can I know if VC is interested in my project?

Good question! Teach you a little trick. You have three bait to catch VC: one. Project profile; ii. 16 page Business plan; III. complete Financial forecast plan.

Fishing steps:

(a) write a short email, including one or two sweet words, based on the list of counterpart VC found in your home assignment, with your "project Profile" sent out;

(B) If the VC immediately has a reply and asks if you have a more detailed business plan, you should immediately send out the 16-page business plan;

(C) After you have issued a business plan, VC and you contact, ask you have a detailed financial plan, you should be excited to send detailed financial plan immediately sent, and alone to Haagen-Dazs to buy a cup of the most delicious ice cream self secretly celebrate, see, your business plan to spend the time effective! You should start to prepare, it is likely that the VC will come in a few days to invite you to his (her) office interview.

(D) If VC does not respond to your "project profile" within two weeks, you can send your email again, including one or two sweet words, and take the initiative to enclose your "business plan";

(E) If the VC has a positive response, please repeat (C) the action. If the VC doesn't respond to your business plan within two weeks, you may wish to send another email asking about his or her feedback on your business plan. If there is no response, you don't have to waste the bait, there is no fish in this pool.