Contents of business plan document

When I decided to startup, I was thinking what kind of industry and what kind of service I should provide.

Industry ... of course web.
Service ... 2C (because all of my experiences was services 2B and I wanted to try 2C)

Then I decided to start new web service to consumer.
But I knew that we need much money to expand web services 2C because we must gather lots of users such as to publish ads or something.

I didn't have such much money so I found I need to get funding from angels or VCs. In order to get funding, I thought I need prototype and business plan document to present them. I've not experienced to present business plan. So I read some books to learn how to make business plan document.

Here's the summary of my learning and I hope it can help you to make business document (* of course it's just one of sample). Also I will introduce books I read someday in the other articles.

1. Executive summary

  • Vision (that I want to realize through this service)
  • Inception deck (or elevator pitch)

2. Team structure

  • Main team members and their approximate profiles
  • Organization structure (who are in charge of what?)
* Any books and entrepreneurs says "who does" is more important that "what". 

3. External environment

  • Market overview (what kind of changes are happening?)
    + Population
    + Internet users / Smartphone users (for internet business)
    + Social infrastructure, AEC (for business in SEA)
  • Market size
    Definition of "market"
    Calculation of market size
    * Generally said VCs don't invest for business with smaller than 100M USD market size.
  • Market structure
  • Competitors
    * This is required in business plan document. If you don't include it, VC must think your research is not enough or you "hide" something.

4. Sales and profit estimation

  • Basic strategy of business
    + Number of users
    + Number of contents
    + Monetize point
    + Oversea expansion
  • Profit and loss planning
    + Number of users and unit price
    + Sales
    + Cost
    + SG & A expenses
    * Monthly data for the first one year, yearly data for the next 4 years, totally 5 years data is required.
    * When can you get how much profit?
    * When do you need how much funding?

5. Funding overview and equity finance

  • What way of exit do you aim?
  • Assumed corporation value and its reason
    Calculate the market capitalization in the DCF method
  • Scheme of funding
    Decide when you need how much funding based on P/L plan
  • Shareholder composition
    Calculate carefully equity finance
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About Tomohide Kakeya

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