03年麻省理工学院商业计划书讲义纲要及基础部分50pthe nuts and bolts of business plans.ppt

The 14th AnnualThe Nuts and Bolts of Business PlansMIT Course 15.975January 2003Joe Hadzima(MIT S.B.,M.S.in Management;Harvard Law)Senior Lecturer,MIT Sloan SchoolManaging Director,Main Street Partners LLCJoost Bonsen Yonald Chery MIT Sloan Graduate Student MIT Course 6,PhD CandidateFormer Lead Organizer,MIT$50K Competition$50K Finalist,Founder Virtual Ink jpbonsenalum.mit.edu yonaldalum.mit.edu TA:Jorge Bravo (15975-tamit.edu)Why Should You Be Here?-14th Year,1,600 to 2,000 people,Multiple companies started-Who Am I?-Why Do We Do This Course?-Who Should Take This Course?-Who Is In The Audience?-Take This Course For CREDITThe Nuts and Bolts of Business PlansThe Nuts and Bolts of Business PlansCourse InformationMIT Course 15.975 :/entrepreneurship.mit.edu/15975/3 Credits Pass/FailClass Attendance RequiredWritten Requirement-Executive Summary or-Analysis of Business PlanThe Nuts and Bolts of Business PlansWe Want You To SUCCEED-Jorge Bravo,TA 15975-tamit.edu-Krisztina Holly,$10K and$50K Winner,Executive Director of the Deshpande Center-Joost Bonsen,Former$50k Entrant,Lead Organizer,Television Personality-Yonald Chery,Course 6,$50K Finalist,Founder of Virtual InkThe Nuts and Bolts of Business PlansKrisztina HollyJanuary 2003Worthy IAP Entrepreneur Events(This Week)Wed 1/22 10a-12n 2-105:Fostering Innovation w/Prof Vander Sande,American Superconductor(plus bustour)Weekly Wed Muddy 8p+(AgeID)Thurs 1/23 4p Lobby 13:Deshpande$50K DinnerFriday 1/24 1-5p Wong e51:SEBC Technology&Entrepreneurship Forum&VentureFestJanuary 2003Worthy IAP Entrepreneur Events(Next Week)Mon 127 10a-12noon 4-231:Fostering Innovation w/Sherwin Greenblatt,VMS(and former BOSE President;also a bustour)15.976 Starting&Running High Tech Co every afternoon 2:30-5pWeekly Wed Muddy 8p+(AgeID)JazzLink Thurs 1/30 6p Walker(AgeID)Charm School Friday;-)January 2003Yonald CheryA Brief Introduction to Virtual InkJanuary 2003Course Schedule6:30pm to 8:30pm Room 10-150BUSINESS PLAN BASICS-Tuesday,January 21TECHNOLOGY STRATEGY;MARKET IDENTIFICATION Wed,January 22SOLVING THE WEAKEST LINK,SALES-Thursday,January 23*LEGAL ISSUES;PRESENTATION SKILLS-Monday January 27BUSINESS MODELS;FINANCIAL PROJECTIONS-Tuesday,January 28FINANCING SOURCES;EXECUTING THE PLAN -Wed,January 29*In conjunction with the MIT Enterprise Forum Satellite Broadcast-7:00pm-9:00pm in Kresge AuditoriumJanuary 2003SESSION 1:BUSINESS PLAN BASICS The Business Plan-A SUPPORTED VISIONTechnologyIntellectualPropertyMarketAnalysisCompetitiveAnalysisSales andDistributionTeamFinancialProjectionsDetailedSupport/FoundationFull Business PlanPowerPoint PresentationExecutive SummaryElevator SpeechMission Statement 1 paragraph30 seconds2-5 pages10-15 minutes20-30 pagesJanuary 2003SESSION 1:BUSINESS PLAN BASICSWhy Write A Business Plan?What Should Be In A Business Plan?The Business Plan As A Financing DocumentWhat We Will Discuss Today:January 2003SESSION 1:BUSINESS PLAN BASICSBecause I have to.Needed for financingStrategic partneringTo explain business to customers/suppliersTo attract key peopleWhy Write a Business Plan?January 2003SESSION 1:BUSINESS PLAN BASICSBecause I Need to Understand My BusinessThe Business Plan is a result of a PLANNING PROCESSWho are your customers?Why will the buy your service or product?What will they pay?How will you make and deliver the service/productWhat resources(people,money,technology)will you need?Can you make money/create value?Why Write a Business Plan?January 2003SESSION 1:BUSINESS PLAN BASICSTypes of PlansOperational plansExternal plansSummary PlanFull Business PlanWho should write the Plan?CEO alone?The team?A hired writer/consultant?January 2003Business Plan TargetingAudienceIssues to EmphasizeIssues to De-emphasizeLengthInvestorFast growth,potential large market,management teamAssets20 40 pagesStrategic PartnerSynergy,proprietary productsSales force,assets20 40 pagesBankerCash flow,assets,solid growthFast growth,hot market10 20 pagesLarge customerStability,serviceFast growth,hot market20 40 pagesKey employeesSecurity,opportunityTechnology20 40 pagesMerger&acquisitionPast accomplishmentsFuture outlook20 40 pagesExcerpted from:Gumpert,David E.,How to Really Create A Successful Business Plan,INC Publishing 1990January 2003SESSION 1:BUSINESS PLAN BASICSWhat Should Be In A Business Plan?Size/Packaging Of The PlanAvoid the 3 thick binderSeparate binding of Executive Summary?How to bind?staplespiralVelabindAccubinderAppearance should be professional but not overly slickJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?The Plan is a SELLING DOCUMENTDont lose sight of the visionThe excitement must come throughThe Plan should project your imageBUT:The Plan Must Be DefensibleJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?Elements of a PlanExecutive SummaryThe Opportunity and the Company and its Services/ProductsMarket Research/AnalysisEconomics of the BusinessMarketing PlanDesign and Development PlanManufacturing and Operations PlanManagement TeamScheduleCritical Risks,Problems and AssumptionsThe Financial PlanAppendicesNotice That“Technology”Is NOT A SectionJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?Cover PageName of CompanyAddressTelephone/fax/emailConfidentiality legendSecurities law legendControl numbering of copiesJanuary 2003SESSION 1:BUSINESS PLAN BASICSCONFIDENTIALThis Business Plan has been prepared by Virtual Ink,a Delaware Corporation.It is being delivered,subject to prior execution of a Confidential Disclosure Agreement,to a limited number of parties who may be interested in investing in Virtual Ink Corporation.The sole purpose of this Business Plan is to assist the recipient in deciding whether to proceed with a further investigation of Virtual Ink,Corporation.While Virtual Ink Corporation believes that the financial and other information contained herein is accurate,Virtual Ink Corporation expressly disclaims any and all liability for express or implied representations or warranties contained in,or for omission from,this Business Plan,or any other written or oral representations and warranties which may be made to the investor in a Stock Purchase Agreement when,as and if one is executed,and subject to such limitations and restrictions as may be specified in such Stock Purchase Agreement,shall have any legal effect.This confidential Business Plan is the property of Virtual Ink Corporation and contains proprietary information belonging to Virtual Ink.It is submitted for the sole and confidential use of the person named below.No part hereof may be reproduced,distributed or used for any other purpose.This copy must be returned to Virtual Ink upon request.This confidential Business Plan does not constitute an offer of securities for any purpose.Copy No._ For:_January 2003SESSION 1:BUSINESS PLAN BASICSWhat Should Be In A Business Plan?Table of ContentsPut one inInclude page numbersJanuary 2003SESSION 1:BUSINESS PLAN BASICSJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?Executive SummaryAn Executive Summary isNOT an abstract of the planNOT an introductionNOT a prefaceNOT a random collection of highlightsAn Executive Summary IS the Business Plan in miniatureJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-Executive Summary(continued)SizeTwo pages(preferable)to five pages(max)The Executive Summary must beLogicalClearInteresting/ExcitingThe Executive Summary is like a RESUMEIf it gets the readers attention,the rest gets readThe Elevator Speech is to the Exec Summary as the Exec Summary is to the Full PlanJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-Executive Summary(continued)The Executive Summary tellsWho you areWhat your strategy/vision isWhat you are doing and/or propose to doWhat is the marketHow many$do you need and what will you do with themWhat your SUSTAINABLE COMPETITIVE ADVANTAGE isWhen the reader is finished he or she should be able to tell someone what you are up to.January 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-Executive Summary(continued)The Executive Summary Should Contain:Description of the Business Concept and the BusinessThe Opportunity and StrategyThe Target Market and ProjectionsThe Competitive AdvantagesThe Economics,Profitability and Harvest PotentialThe TeamJanuary 2003January 2003The Virtual InkExecutive SummaryJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?The Body of the Plan-The OpportunityWhat is the Market/Opportunity?How big is it now?What are the trends-how fast is it or will it grow?Why Is This Time The Right Time For Your Product/Service?Convergence of Opportunity and SolutionJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-The Body of the PlanMarket AnalysisExisting and planned products in marketplaceMarket segmentsMarket players/competitionCompetitive AdvantagesEstimated Market SharesCurrent PlayersYouJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-The Body of the PlanEconomics of BusinessWhat Are Your:Expected Gross and Operating MarginsProfit potential and erosionFixed,variable and semivariable costsMonths to breakevenMonths to Cash Flow PositiveJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-The Body of the Plan Marketing PlanWhat is your Marketing Strategy?Pricing and DistributionPricing and margin erosionDistribution must match strategy/pricingSales TacticsWho will be the first customer,second customer etc.?How will you reach the customer?Advertising and PromotionJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-The Body of the Plan Development PlanWhere is development today-product statusWhat development is needed?Time and resources needed for developmentDo you have to produce a complete product to get going?Avoid“Nuclear Fusion”Difficulty and RisksProduct Pipeline PlansJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-The Body of the Plan The Development Plan(cont)Intellectual PropertyDo you have patents?How broad is your intellectual property protection?How do you compare to your competitors?Other technologies?Proprietary RightsDo prior employers have rights?January 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-The Body of the Plan Manufacturing and Operations PlanOperating CycleGeographical LocationFacilities neededStrategy and Plansoutsourcing vs.in-houseRegulatory and Legal issuesFDAEnvironmentalJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-The Body of the PlanThe TeamThe Internal TeamBackground of principalsHow long has the company been in operation?The External TeamBoard of DirectorsAdvisory BoardProfessional AdvisorsDont“name drop”if the external person has not agreed to be mentionedJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-The Body of the PlanAction PlanWhat Will You Do and When?Identification of“Credibility Testers”Sequencing to build VALUEEliminate or Reduce DependenciesCoordination of Schedule,Value Recognition Events and Financing RequirementsJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-The Body of the PlanRisk Factors and Critical AssumptionsBe sure to address Negatives as well as PositivesThere are always negatives/problemsSet the stage for the readerShow that you have a plan for getting around or minimizing the negativesReduce Dependencies If PossibleJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-The Body of the PlanThe Financial PlanActual Income Statements and Balance SheetsPro FormaIncome StatementsBalance SheetsCash Flow StatementsBreakeven ChartAssumptions should be statedGet these right or defensibleJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?-The Body of the PlanThe Financial Plan(cont.)SpreadsheetitisDo numbers balance?Do the numbers tie to the PLANCASH IS KING C I M I T Y MUse traditional financial statement presentation Now is NOT the time to invent new methods of presentationGet help if you arent expertTie to rounds of financing/expansionJanuary 2003SESSION 1:BUSINESS PLAN BASICS What Should Be In A Business Plan?AppendicesSeparately Bound VolumeResumes of PrincipalsProduct LiteratureTrade Press/Business PressPatents(front page)Testimonials LettersTechnical InformationConfidentialityTechnical person to technical person discussionJanuary 2003SESSION 1:BUSINESS PLAN BASICSFine Tuning/Targeting the PlanHave an Independent Reader Review the PlanOne or more independent readers for feedback:Retired industry pro?Customer(?)Consultant?Professor?Accountant-yes definitelyLawyer-yes definitelyJanuary 2003SESSION 1:BUSINESS PLAN BASICSThe Business Plan As A Financing Document(Excerpts From Materials Prepared By Lita Nelsen,Director of MIT Technology Licensing Office)A.First Reading:Like a ResumeMake The Cut,So That You Get An Opportunity To Tell Your StoryB.Second Reading:Justify The InvestmentC.Third Reading:Commit To A Plan That You And The Investors Can Live With.REMEMBER:If you dont make the FIRST CUT,B and C never happen.January 2003SESSION 1:BUSINESS PLAN BASICSThe Business Plan As A Financing DocumentMAKING THE FIRST CUTAn Idea Too Good To IgnoreA Financial Promise Too Good To Turn DownA Team Good Enough To Believe InAn Action Plan Thats CredibleFocusedDetails That Give Assurance of Insight,Commitment and Follow ThroughFormat and Style That ShowPassion SanityJanuary 2003SESSION 1:BUSINESS PLAN BASICSThe Business Plan As A Financing Document.WHY PLANS FAIL THE FIRST CUTInsufficient MarketNon-Credible TechnologyToo WildToo Blue-Sky(Unproven)Not ProtectibleToo MundaneInvestment Too Large For The PromiseFailure to Understand The MarketJanuary 2003SESSION 1:BUSINESS PLAN BASICSThe Business Plan As A Financing Document.WHY PLANS FAIL THE FIRST CUT(cont.)Action Plan Not CredibleToo OptimisticNave About The HurdlesRuns Off In All DirectionsNot Ambitious EnoughRegulatory Barriers Insufficiently AddressedGaps Filled By HandwavingNo Promises At AllTeam Not CredibleJanuary 2003SESSION 1:BUSINESS PLAN BASICSThe Business Plan As A Financing DocumentCOSMETIC”REASONS FOR FAILING THE FIRST CUTI Cant Understand It.Filled With Market Or Technology-Specific Jargoni.e.,WHAT IS THE BUSINESS?Nave ProjectionsSloppy:Misspellings,Poor Grammar,Poor Quality PrintingToo Damn LongIgnores The Basics“Forget Marketing,My Technology Is Best”Nave(or Terrible)WritingJanuary 2003SESSION 1:BUSINESS PLAN BASICSSUMMARYWe Have CoveredWhy Write A Business Plan?What Should Be In A Business Plan?The Business Plan As A Financing DocumentJanuary 2003SESSION 1:BUSINESS PLAN BASICS The Business Plan-A SUPPORTED VISIONTechnologyIntellectualPropertyMarketAnalysisCompetitiveAnalysisSales andDistributionTeamFinancialProjectionsDetailedSupport/FoundationFull Business PlanPowerPoint PresentationExecutive