You’ve got a wonderful idea and you’re ready to put that idea to work. You’ve carefully refined that idea and you want to take your dream of building your startup to the next level. You’ll need to get the necessary funding. $58 million in venture capital was invested into startups in 2015 alone, and the amount of money being pumped into the ecosystem continues to rise. Securing funding might not be as easy as you might think, however: you’ll need to formulate an above-average business plan to pique the interest of investors.
Whether you’re looking to attract angel investors or gain the attention of venture capital firms, you’ll need a well-crafted summary of your business and how you desire to run it. Sadly, around fifty percent of startups fail within their first four years. Many of these failures could have been avoided if more energy was poured into creating a strong business plan. This plan is the blueprint for your startup and its crafting should be treated with the utmost care. But in order to write a quality business plan, you’ll need to know what key elements comprise it.
Here is the list of key elements to include in your startup’s business plan:
1. Executive summary
Your executive summary is a concise description of your entire business plan. It’s usually around one to two pages and briefly covers every element of your plan. It’s best to write this last, as you’ll better summarize your plan after fully completing it.
2. Business description
This is the actual description of your business. Describe what product or service you’re providing, how you plan to sell it and your motivations for doing so. Here you can also discuss how your startup is different from your competition.
3. Market analysis
This section is vital to your plan. You’ll need to show that you’ve done the proper research about your target market. Address competition and the market share you project will be available to you. Present what you feel would be your ideal customer and how you plan to reach them. Analyze trends in your industry and propose ways of utilizing them to your startup’s advantage.
Administration of your startup is of the utmost importance. Go into depth about the administrative details of your startup like the number of staff you plan to hire, the expertise of your board of directors, the role you plan to take on, and the way you plan to manage your talent.
5. Marketing strategy
You’ll need to prove to investors that you have a plan for generating business. This is primarily done in the marketing strategy component of your business plan. Identify the channels your target consumers are using. Lay out a plan for reaching your target market through those channels. Write about successful sales tactics used by your competition — and how you will improve upon them.
6. Funding requirements
Now that you have explained the basic structure of your startup, you’ll need to give an estimate of the cost to start it. Don’t fret too much — you don’t have to worry about being precise. You can’t foresee unexpected costs, and you won’t be expected to. Simply supply your very best estimate, and back it up with research.
7. Financial forecast
Running a business means tracking cash flow. Give an accurate prediction of expected costs, projected revenue and your proposed budget and base these numbers off of relevant market research.
In order to create a winning business plan, you’ll need to know its basic structure. Use this list of the 9 key elements to include in your startup’s business plan as a boilerplate for your own. These elements provide a strong structure on which to build and expand upon. Keep refining, rewriting and re-evaluating until you are satisfied you’ve made a comprehensive, foolproof plan for your startup.
Ellie Martin is co-founder of Startup Change Group. As author and writer, her works have been featured on Entrepreneur, Yahoo! , Wisebread and AOL, among others. She currently splits her time between her home office in New York and Israel.