Transcript Document
Presented by the
UH Pacific Business Center
Program (PBCP)
David M. Gillespie
PBCP is a partner with the Shidler in providing
economic technical assistance throughout
the Pacific Region. The PBCP also operates
the Honolulu Minority Business Enterprise
Center. We have extensive experience and
expertise in business plan development.
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Document/Submission Requirements
Prefer PDF format
Less than 1mb single
file
Single Spaced (min.), 12 Point Font
(min.), 1” Margins all around (min.) &
8.5” X 11” paper size
Emailed as attachment to:
[email protected] by 5pm on 4/4/08, AND
Five hardcopies to PACE office
If Mailed - postmarked by 4/4/08
If Hand Delivered – At PACE by 5pm on
4/4/08
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Document Specification Requirements
Sheet – 1 page
Executive Summary – Maximum
Cover
2 pages
Business
pages
Plan – Maximum 10
Attachments
or Appendices –
Maximum 10 pages, open format
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Judging Criteria
Overall Appeal -10%
Attractiveness of Market Opportunity-15%
Value Created by the Product/Service-15%
Competitive Advantage of Venture-15%
Operational & Technological Viability15%
6) Management Team Capability-15%
7) Capital Requirements & Financial Forecast
-15%
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2)
3)
4)
5)
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Suggested Organization
1. Cover Sheet
2. Exec. Summary - Overall
Appeal (10%)
3. Overview of the Firm
6. Marketing Plan/Strategy
– Competitive Advantage (15%)
7. Operations Plan –
Operational & Technical
Viability (15%)
Team – Team
4. Market Analysis – Market 8. Management
Capability (15%)
Opportunity (15%)
5. Products/Services
Offered – Value
Created (15%)
9. Financial Plan – Capital
Requirements & Projections
(15%)
10. Appendices &
Attachments
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Data Requirements:
Team Name
Business Name
Names of All Team Members
Other:
Logo Development
Balanced Sheet with Lots of White
Use of Color
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Judging Criteria 1 - Overall Appeal of the Plan
(10%): Compelling “vision”; enthusiasm;
greater than the sum of its parts.
The business plan judge will probably obtain most of
his/her ‘appeal’ in reading your Executive Summary.
Write the Final Executive Summary Last
Things will change as you write the plan
The Executive Summary you already
turned in can be adjusted/changed.
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‘Elevator Pitch’ – The reader must ‘get it’ in the
Executive Summary.
Who – Manoa Tansgenics, Inc., a start up life
science company
What – Provide genetically modified mice, a novel
gene insertional methodology and gene therapy
research development.
How – Use a proprietary gene insertion technology
invented by the two business founders
Why – Transgenic mice market at $180 million;
once technology validated potential for gene therapy
market projected at $5.7 billion in 2011
How Much & Return – Need $2.5 million for
research; offer 15% equity in the firm. Once reach
20% market penetration, firm sold/merged/IPO.
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Other Key Items to Address:
Mission and Objectives
Product, Process, or New Business
Model
The ‘Pain’ the Above will relieve
Target Market – Customers, Value
Added, Competitors, Competitive
Advantage
Business Model – Who pays, how much,
and how often. Model margins
The Executive Summary MUST stand on its own;
don’t copy sections word for word from the
business plan narrative—a common mistake.
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Include/Expand By the Level of
Importance to Your Business Plan
Technology & Intellectual Property
Management Team
Milestones/Goals
Revenue/Cash Projection
Funding Needs & Use of Proceeds
Investor Potential Return & How and
When Returned
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Major Sections to Consider – A way
of introducing the firm
Value, Vision & Mission
History
Distinctive Competence
Technology
Competitive Advantage
Strategy and Objectives of Firm
Major Milestones Achieved to Date
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Judging Criteria 2 - Attractiveness of
Market Opportunity (15%)
Market
size and growth
potential
Your
firm’s potential in this
market
Expected
margins and net profit
long-term potential
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Market Profile - Show you know the market you
are entering
Demographic/Geographic/Psychographic or
Business Profile
Maturity of Industry – Which Phase: Start-Up,
Growth, Maturity, Decline
Size of Market – Units and Dollars
Growth Potential – Tie it to research and in units
and dollars over time
Market ‘Pain’
Needs – What is the ‘pain’ of this market
Set it up so that your product relieves ‘pain’
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Market/Industry
‘Business Model’
What is the current set-up (business
model) for businesses in this market.
What is the margin and net profit
profile of this market/industry –
financial research
Is there a niche unsatisfied, or a better
business model— set it up so your
product/service, and, or business
model is the answer.
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Competition – Who else provides the service or
product and what else do they provide their customers
Competitive
Position of Leaders
Market
Share Distribution - % of the
market pie by leader, market share
growth
Barriers
to Entry – How difficult is it to
enter the market you’re interested in.
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Judging Criteria 3 - Value Created by the
Product/Service (15%)
How will you relieve the ‘pain’- what is
the unique value of product/service
Importance of Product/Service to
Customer
Product/Service Description or
Prototype
Features and Benefits of
Product/Service
Market Reaction to Product/Service
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Product/Service Description – Clear,
concise and complete. Detail in
Appendix
Product Benefits & Features – The
things that will relieve the ‘pain’ you
identified in Market Analysis.
Product/Service Customer Reaction –
Sampling, interviews, testimonials
Product SWOT – If appropriate
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Cleary Describe Product Need
Need may not be fully recognized by
the market at this time
Describe how you see the ‘need’
developing
Product Development Plan
Current level of product development
Phasing plan of product development
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Judging Criteria 4 - Competitive Advantage of the
Venture (15%)
How Will the Product Gain Market
Share Against Competitors
Market Share and Growth Profile
Potential
How Long to Get Product/Service to
Market
What Business Model/Distribution
Method Will Position the Firm Best
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Business Model Proposed
Be
as specific as possible. Clear,
concise explanation (B2B, B2C, etc.)
Product Market Development Plan
Phases
of development: drawing,
prototype, pilot manufacturing
Overcoming Competition – How?
Pricing,
Business Model, Quality,
Market Tactics
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Focused
Target Market(s) Profile
Size and Trends of Markets
Demographic, Geographic,
Psychographic or Business Profile
Buying Sensitivity
Vulnerability to Economic Factors
Purchasing Patterns
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Pricing
Recovery
Strategy – Image Awareness, Cost
How
will you fit within the market? - Above
Market, Match Competition, Below Market ?
Promotional Strategy
Media – Web-based, Print, TV: what does
the competition do?
Message – What will be your key message; Is
it focused on your core business?
Promotional Budget – Sales growth requires
a matching promotional budget.
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Sales Strategy – How will sales be
developed and processed
Sales
Generation in the Business
Model
Sales
Force Management
Order
Processing
Compensation
Plan
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Sales
Projections
First
Year – by quarter; then yearly
By Product/Service Line
By Units and Dollars
Other
Marketing Activities
Service
and Support Capability
Strategic Alliances
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Judging Criteria 5 - Operational &
Technological Viability (15%)
Product/Service Production
Product/Service Distribution
Production obstacles and how you
will overcome them
Any essential technology property and
how will it be protected
Develop a plan timeframe
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Production Plan – Where produced or
developed – materials required & sources, outsourcing
Technical requirements of producing
the product/service and how met.
Patent protection or other means of
protection
Distribution Strategy – How will you get
your product/service to the customer
Retail, Wholesale, Distributor, Internet,
Licensing, Franchising – tie into the
business model
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Manufacturing Requirements – by
order of importance to the plan
Facilities – plan for growth
Equipment
Outsourcing
Third-Party Agreements
Contracts
Licensing
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Milestones – Make/Break Activities
Schedule
of key activities to be
accomplished – GANTT Chart
Specific/Crucial
Objectives:
Timeframe
Responsibility of who?
Results expected
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Judging Criteria 6 -Management Team Capability
(15%)
Venture management/expertise needs
Education, experience, skills of team
Acknowledge skill gaps and show how
you will overcome them – hire, contract,
etc.
Role of each team member in the
development of the venture – dual roles
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Names
Roles
and Positions
Experience and Education
Other Related Experience
‘Gap’ Experts – Technical skills
Strategic Alliances
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Show that Your Organization is Set to Meet the
Growth You Planned For
Principal Players – Do you have the right
people in the right places? Will the firm’s
expertise requirements change as the firm
grows?
Consultants and Specialist – Are industry
changes severe enough to bring on experts?
Organizational Structure – What is your
organizational structure and will it be
appropriate for your firm’s growth?
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Judging Criteria 7 - Capital Requirements &
Financial Forecast (15%)
Capital
Needs
– Capital asset purchases, start-up
expenses, working capital
Sources – Venture Capitalist, lenders, FFF?
Phasing – Start-up, 1st, 2nd, other rounds
Entity Ownership structure
Investment Exit Strategy
Project Evaluators – ROI, NPV, IRR
Cash Flow - when turn positive
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Financial
Forecast
P
& L Summary
Cash Flow Summary
Cash
Flow Breakeven – When does
firm turn to positive cash flow
Investor
Return – ROI, Dividends,
Capital Returns, NPV, IRR
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Stages of VC Funding:
Seed
– Develop proto-type
Early Stage – Launch product
Growth Stage – Expand marketing
Mezzanine – Add resources,
acquire other firms
Develop a structure/mix of funding
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Income Projections – Revenues,
COGS and major expense categories. $
and %.
Cash Flow Forecasts –Too little cash
(common problem) for working capital.
Cash Flow Break-Even Analysis –
Do you need to generate more or less sales
to cover operating costs than what you
originally planned for?
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Income Statement Format
Major Revenue Categories – Ascending
Order
By product/service type
Show Key % - Gross & Operating Margins
Major Expense Categories – Ascending
Level of Detail
Order
COGS, Personnel, Rent
By Quarter for the first 12 months
By Year after first 12 months
Three years minimum, five years maximum
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Cash Flow – Direct Method
Operating Activities
Revenues, Direct Materials and Labor,
General & Admin. Expenses
Investing Activities – Asset
Purchases
Financing Activities – Dividends,
Return on Investment
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Be sure you have a financial macro & micro
understanding of your venture and that micro
and macro are in sync.
Macro
View – The financial big
picture: Review, understand and
analyze the financial statements you
generate.
Micro
View – The financial details:
Pricing strategy, margins, mark-up of
the product or service you are offering.
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Examples of what you can put in the Appendix
Detailed Financial Documents
Start-up Cost Schedule
Funding Sources Detail
Detailed
Income Projections
Balance Sheet Projections
Detailed Cash Flow Projections
Cash Break-Even Analysis
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Assumptions Critical to Your Plan
Interest
Rates: Long & short-term
Sales on Credit
Inventory Turnover
Personnel Overhead
Licensing Agreement
Other
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Product/Service
Detailed Description, Drawings,
Production Processes
Management Team
Resumes
Consultants/Experts Qualifications
Other
Market Research Data
Relevant News Articles
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6 C’s Of A Winning Business Plan
Complete – No missing sections, cover all the
judging points.
Clear – Concept of your product/service, its
market, and business model are explained
completely during the first read of the plan.
Credible – The plan makes ‘sense’.
No crazy
revenue projections, outrageous market share
claims, belief in a lack of any competition, etc.
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6 C’s Of A Winning Business Plan
Compelling – Draws the reader into the business
concept they way a good novel draws in a reader. The
reader buys into your idea because your plan is
convincing and your narrative is persuasive.
Customer Focused – Show you understand your
customer and how you will relieve their pain.
Concern for Investor/Lender – Show how, and
when, debt/equity is returned and ROI is developed.
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‘Form’ of the Plan
Use of Charts and Graphs
Simple,
Font Type and Size Changes
Limited
Clean, Easy to Read
Changes - subtle
Color
Make
sure it prints ‘ok’ in black and
white
Shading and texture for graphs/charts
Number the pages
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Plan Development
Many contributors—one writing voice
Proofread by non-team member
Support assumptions when ever possible
Business Plan Team Skill Needs
Marketing – Research, Market Size, Sales Est.
Financial – Projections & Statement
Development
Plan Wording
Positive word choices; not “might”, “maybe”,
“probably”; but don’t overstate or exaggerate.
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Business Plan Judges Are Hawaii
Business Professionals
Bankers,
Business Owners, Gov’t
and Non-Gov’t Organization
Employees
Business Service Providers –
Accountants, Lawyers, Consultants
Investors, Venture Capitalist
Entrepreneurs
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Software & Website Assistance:
Business Plan Pro – palo-alto.com
Business Plan Builder – jianusa.com
Business Plan Writer Deluxe
Bplans.com
Businessplans.org – sample plans
Microsoft Business Planner – Office
Pro
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Good Luck to
All!!
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