HOTB Software Solutions
HOTB is a highly experienced software development company that provides in-kind angel capital to startup entrepreneurs with a viable technology based business. HOTB helps startups bridge the gap between their friends and family round and their venture capital round by subsidizing expensive technology needs. HOTB specializes in building custom software platforms to provide certainty of execution, experience, credibility, security and compliance. Additionally, HOTB Ventures has been formed for instances of passive investment when software development is not needed.

Manatt
Manatt, Phelps & Phillips, LLP is known for quality, for extraordinary commitment to clients, for integrated, relationship-based services, and for a range of capabilities typically found only in boutique firms. We are progressive and entrepreneurial compared to other major firms, and we are deeply committed to diversity, to public service, to involvement in the communities we serve and to excellence in all we do.

TriNet
Tech companies partner with TriNet Passport to compete for top talent by using our bundled HR products that cover the core services of payroll, fortune 100 benefits, risk and compliance, a scalable HR team all on a cloud platform. TriNet reduces the time businesses spend managing HR and administrative issues while providing enterprise-grade cloud capabilities. This enables entrepreneurs and management to focus on what’s important from raising funds to driving revenue. Join hundreds of executives in high tech who have experienced the TriNet Passport difference, working for companies in hardware, software, SaaS and telecommunications. Contact choy.chew@trinet.com for more information.

Eureka
The Eureka Building is a 3-acre technology campus in Irvine, California designed to help accelerate innovation. Founded in 2014 by Peter Polydor, our goal is to support local entrepreneurship by giving innovative companies and entrepreneurs in Orange County a home that is centrally located and easy to access. Through partnerships we are more than just a home, but are a support network hosting startup events while fostering mentorship relationships with our partners all within one of the most creative spaces in the region.

CrashLabs
CRASHLABS IS A VIBRANT COWORKING AND EVENTS COMMUNITY THAT ENHANCES WORK/LIFE BALANCE FOR THE NEW ECONOMY OF UNTETHERED WORKERS. CRASHLABS OFFERS CREATIVE AND FLEXIBLE SPACES SUCH AS OPEN DESKS, DEDICATED DESKS, PRIVATE OFFICES, AND EVENTS SPACE THAT SERVE EVERYONE FROM THE INDIVIDUAL TO CORPORATIONS.

Real Office Centers
At ROC you’ll find a cohesive and progressive working environment with professional support for entrepreneurs, innovators, and today’s leaders. Beyond merely providing the physical workspace, we contribute to your capital growth by facilitating innovation, inspiration, and collaboration. With professional support services, educational events, and a stimulating environment, ROC is where you and your company will grow. Our open-source work environment and friendly staff complete with private receptionists keep business running smoothly. ROC handles day-to-day operations and facility management so your company can focus on what it does best.

Pitching Your Business vs. Planning Your Business

Posted by Jonathan Greechan on 2014-01-14

Founder Insight gives you feedback from the startup trenches.


In this post from the LivePlan.com blog, LivePlan CEO, Sabrina Parsons, addresses the idea that startup founders are putting more and more emphasis on their pitch and less on their business plan. While a great pitch is critical to getting any business off the ground, a business plan is an essential key to success and shouldn't be neglected.

LivePlan, the #1 selling business planning software in the world, supports Founder Institute companies across the globe with their busines planning and forecasting. 

Pitching Your Business vs. Planning Your Business originally appeared the LivePlan blog and has been republished below:

 

"I feel like recently, as the Lean Startup movement gains more and more traction (I love the Lean Startup principles) and there are more incubators, accelerators, innovation centers, etc. helping startups get off the ground, that I’m hearing more and more this idea:

“You don’t need a business plan, you need a great pitch”

While I absolutely agree that a great pitch is critical for any high growth startup thinking of pitching Angel Investors or Venture Capital firms, I am puzzled by this idea that you need a pitch but not a plan. When I talk to people who run incubators and accelerators, they all give me the same song and dance. Full disclosure: as the CEO of Palo Alto Software, the developers behind LivePlan, a Software as a Service online planning solution, it is in my benefit to have every small business and every startup write a business plan.

But nonetheless, I run this business because I truly do believe in the tools that we produce and truly feel that planning will make startups and small businesses more successful. So, back to this idea of a plan vs. a pitch and what a startup really needs to be successful in today’s landscape. Let’s make the assumption that you don’t need a plan. That what you need is a fantastic pitch. A pitch where you presumably need to talk about:

  • Your special sauce. Why your product or service is what this world needs.
  • Your team. Why you are the ones to make this happen.
  • The competitive landscape.
  • The market, and how you will reach it.
  • How much you will sell, (i.e. your forecast) over the next 12 months, and then the next few years.
  • How much it will cost you to sell (i.e., your Expenses).
  • Your implementation plan/timeline to implement.
  • How you will use the investment you are asking for (most likely it will match a Profit & Loss you have done).
  • What investors will get for giving you their money.


My question to all those people who say you don’t need a business plan, and Venture Capitalists don’t read business plans (believe me, if they invest, they will want you to do some planning), and plans are a waste of time, is how in the world can you pitch, and how in the world can you know what to pitch, if you don’t do all the research involved in a plan? Everything you need to include in a pitch deck comes from the research and financials you would do if you were writing a plan.

Now, does anyone need to write a 30-page plan? Absolutely NOT. No one will ever read that. But every startup needs to know the critical points I outlined above. And you can’t know that information without going through a business-planning exercise.

The cool thing about actually going through the steps to research and jot down the critical information required for your pitch is that, if you keep it in a place that you can go back to and review it, you can keep on top of changing assumptions. Anyone who has started a business understands that what you THINK is going to happen rarely ever plays out exactly in the same way. But being able to return to a plan, and a forecast and a budget, and compare the difference between what you said and what actually happened helps you understand critical metrics for your business. Some examples:

  1. You may think that you can get paid promptly, every 30 days. When you implement, it turns out that your payment terms as a new startup need to be every 45 days. Knowing this information, and comparing the actual to your planned, will highlight a potential cash flow issue before it becomes a crisis. Your “planning” (not your plan), has paid off.
  2. You may have estimated your cost of goods sold (COGS) to be $20. It turns out your volume is better than expected and you brought your COGS down to $18. Knowing this allows you to either understand why you are more profitable or allocate the extra money to marketing and sales to sell even more. Your “planning” (not your plan) has paid off.
  3. You may have estimated your vendors would accept payment from you in 30 days (your Accounts Receivable). But, because you are so new, your vendors end up negotiating 15 days, or even worse Cash On Delivery (COD). Knowing this information and comparing it to your plan will alert you to yet another potential cash flow crisis. You will need to make sure you can pay more quickly than you thought, which may mean getting more funding or using your funding faster than you had planned.


I could go on, but I think you get the picture. I completely agree that old fashioned 30-50 page business plans are relics of the past. But I think that sometimes, when people have this idea that they are only pitching and not planning, they are really just changing the vocabulary.


Planning should be nimble. Planning should focus on just the information you need to run your business, and planning should be an ongoing process to help you understand where you are doing well, and where you may be headed into trouble – before it happens. The more information you can gather and understand about your business and how it relates to your market, competition, pricing, bottom line, and cash, the more successful you are likely to be.

So go ahead, pitch. Don’t send a business plan to anyone. But you better have done your homework and have all the research somewhere, so that when that Venture Capitalist asks you a pointed question about why your forecast is realistic, you can launch into an intelligent response that covers your market, the size, the competition, and your pricing, which will show that Venture Capitalist you actually do know what you are talking about, and could potentially implement this business."


About Sabrina Parsons
Heir to a business planning kingdom and CEO of the world leader in business plan and management software (flagship products include LivePlan and Business Plan Pro) Sabrina knows more than a little something about planning, pitching, and managing a startup to success. Sabrina took over Palo Alto Software in 2007 (her father was founder and business planning icon, Tim Berry) and went on to not only beat the odds (approximately 70% of family-owned businesses don’t survive succession) but to successfully expand the company’s offering from a shrink-wrapped software company (Business Plan Pro) to a booming SaaS corporation, hosting business planning, pitching, and financial management in the cloud (for more than 60,000 small and mid-sized businesses and counting) via LivePlan (www.liveplan.com).

Sabrina is a graduate of Princeton University and president of the Princeton Entrepreneurs Network. She is also a mother of 3 young boys; involved in multiple business planning competitions; blogs for Forbes Women; and is a passionate advocate for evolving the workplace for today’s modern parents, including instituting and personally taking advantage of Palo Alto Software’s baby-friendly office policy.

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