From Business Plan to Funding: Summary from April 28, 2009

We had an inspiring chat with Tim Berry (@timberry) this week on navigating the waters of business plans and funding.  Thanks to his encouraging thoughts writing a business plan may not look as scary or painful. The conversation provides a wealth of information about how and when to look at funding as an option for your company.

First, some reminders:

  • Next buzz-up is Tuesday, May 5th from 8:00 PM – 10:00 PM Eastern Time.  Join us – we promise you’ll learn something.
  • Help us spread the word! The more voices, the better the conversation.
  • Instructions for participating are at http://sbbuzz.biz/instructions
  • Below is a summary of the most recent discussion. To see the full conversation, go to: http://bit.ly/VeI46.

sbbuzz: Q1 Where do you see technology going in the next 5 years and what will the impact be on your company? #sbbuzz

  • 99designs: A1 – Mobile will continue to be a huge trend for technology #sbbuzz
  • bradfordshimp: Technology will be set free. Mobile web will become standard and work from anywhere easier. #sbbuzz
  • mariaduron: Q1: Tools 4 communication will increase+ grow which expands and develops my biz #sbbuzz
  • madhousefl: Technology is feeding into our ADD mindset. Quicker, shorter burst of info. Mobility, and impact will be key. The ‘elevator speech’ #sbbuzz
  • deneki: Q1 My customers tend to lag with tech, so the next years will see them just starting to embrace social media and really get online. #sbbuzz
  • scoblitz: @sbbuzz Q1 – Increased move to web and reliance on mobile technology. Being on leading edge now makes it easier to help others. #sbbuzz
  • SvyATL: Q1. Technology will change the way we engage consumers i.e. consumers will shape R&D, product introduction, mktg, pricing directly. #sbbuzz
  • GetAMC: Q1: Consumers will demand more interactive tools (like twttr) 2 connect w/ biz they purchase from. #sbbuzz

sbbuzz: Q2 from @timberry What is the state of small business 100 days into new presidency? Programs, confidence, anything else? #sbbuzz

  • bradfordshimp: Q2 – I think it will be hard to gauge the effect done by Obama policies this early. It takes time for things to roll down. #sbbuzz
  • madhousefl: I’m noticing a lot of small businesses banding together in my community and leveraging each other’s clients in order to maintain. #sbbuzz
  • rongraham1: Q2: I hear “small business is important,” but see no stimulus yet. That sorta means “meet the new boss; same as the old boss.” 😦 #sbbuzz
  • bradfordshimp: Q2 – I think the biggest current effects are on attitude and confidence. Successful biz owners maintain their own and ignore others. #sbbuzz
  • selahsynergy@sbbuzz Q2 Apprehension describes my clients. Lots of words, little in policy to ease their credit issues #sbbuzz
  • pmohara: Q2 My fav shoe store is 1st recipient of stimulus $ in RI ($400K). I want to go & say you just need $10K & a kick butt online plan. #sbbuzz
  • bradfordshimp: I think it is a mistake to look to one man and see if he can make a difference, even a president. Media likes the hero and villian. #sbbuzz
  • desireescales: Q2: I think a lot of owners have decided not to participate in the recession. There are even groups dedicated to this thought. #sbbuzz

sbbuzz: Q3 from @moneymin What is the best way to improve worker productivity? Also, which platforms do you prefer, PC or Mac? #sbbuzz

  • bradfordshimp@sbbuzz Q3 – With me, its going to a results based system with clear expectations. #sbbuzz
  • rzazueta: Q3: Get them more involved in the outcome of what they’re working on. If they see the results, they’ll be motivated. #sbbuzz
  • bradfordshimp: Q3 Productivity lags when people don’t know what they should be doing. Be organized, clear, and inspiring. #sbbuzz
  • rongraham1: Q3: the best way to improve worker productivity goes all the way back to W. Edwards Deming: “drive out fear.” #sbbuzz
  • miawv: Q3 Tie employee compensation to company goal #sbbuzz
  • desireescales: Q3: Workers who engage in social media are more productive. Study: http://tinyurl.com/cv6ghf (expand) #sbbuzz
  • mattharrell: Q3 Set expectation levels and goals. Pay for performance is always a good thing! #sbbuzz
  • selahsynergy@sbbuzz Q3 People want to do good work, acknowledge & reward.#sbbuzz
  • scoblitz@sbbuzz Q3 Platform is becoming less important. It’s a personal preference, let workers choose their own tools when possible. #sbbuzz
  • deneki: Q3: Agreed with @scoblitz We run PCs but it matters less and less as time goes on. #sbbuzz
  • mattharrell@scoblitz I agree. There are few barriers, but generally we work just fine with Mac and PCs alike. Web-based tools are key to that. #sbbuzz
  • Timberry: Q3 I’m finding very little trouble with PC in the office and Mac at home, most of my tools are platform-neutral #sbbuzz
  • rzazueta: Q3: Very strict – Windows on the desktop (except designers), Linux on the servers . #sbbuzz
  • pmohara: Q3 We have everything; PCs,Macs, Firefox, Safari, Chrome, IE, iPhones, BBerrys. And yet collaborate on all same Saas tools. #sbbuzz
sbbuzz: Q4 from @thenextbigzing Thinking of doing virtual launch party for new site w/ twitter. Anyone done that? Any ideas? #sbbuzz

  • snakejw: Q4 – doesn’t sound as much fun as an actual release party. my suggestion combine a real event with twitter. #sbbuzz
  • eproulx: @sbbuzz Great idea…virtual launch party. #sbbuzz
  • bradfordshimp: Q4 – This is an especially interesting question if a large part of your audience is on Twitter. I say go ahead. #sbbuzz
  • miawv: Q4 Yay, virtual launch party on Twitter! Free giveaways, trivia contest and polls all day long. #sbbuzz
  • desireescales: Q4: Have ppl at the party Tweeting about it and create a hashtag or a Tweet Chat during the party! #sbbuzz
  • bradfordshimp@nrohrbach and I are trying to generate buzz for a new biz concept primarily through Twitter (just launched that effort today) #sbbuzz
  • miawv: Q4 More ideas for virtual launch party on Twitter: Twitpic & Twiddeo contest! Just make sure to have someone review the submissions. #sbbuzz
  • rongraham1: Q4: whatever you do, I’d say don’t go virtual only. People want contact. And we already know you won’t ignore Twitter. LOL #sbbuzz
  • ideaAnglers: Q4 – Having never done a launch party of any kind, I would be interested in more ideas for what to do with a Twitter launch party! #sbbuzz
  • snakejw: Q4 learned about sbbuzz through twitter at a conference.#wordcampnola had twitter as well. real+twitter is a great combo #sbbuzz
  • bradfordshimp: Q4 Twitter means you can bring together a wide audience for a launch – perhaps combine it with a blog, webcast, etc. #sbbuzz
  • pmohara: Q4 I wanted to live tweet a local Innovation kick-off party today, but they had no connection (even BBerry). Uhm…oops. #sbbuzz
sbbuzz: Q5 @timberry from @bradfordshimp What do you say to people who say a biz plan is not necessary? #sbbuzz

  • Timberry: To people who say a biz plan isn’t necessary, I say it’s not for others, it’s for us, the owners, to get organized … #sbbuzz
  • Timberry: If you don’t need a plan to show investors or bankers, don’t you want to set your own goals, priorities, milestones, etc? #sbbuzz
  • Timberry: We think we keep our plans in our heads, but we trick ourselves, we can’t track plan vs actual without writing the plan down … #sbbuzz
  • snakejw: Q5 it is a key tool to focus your attention. anyone know of tools to make it more of a living document? #sbbuzz
  • bradfordshimp@Timberry Any suggestions on making a bplan a living document that is referred to regularly and amended as needed? #sbbuzz
  • Timberry@bradfordshimp yes definitely. Set a review schedule and expect to change it. Track how assumptions have changed. Review regularly #sbbuzz
  • bradfordshimp: My concern is that a bplan might just sit on a shelf, or in my case, never be completely written because we try to do too much w/ it #sbbuzz
  • Timberry@bradfordshimp well Ive had a plan for more than 20 years now and it’s never been finished, and it’s usually wrong. I revise often. #sbbuzz
  • eproulx@bradfordshimp #sbbuzz I’m the same way. I don’t know where to begin, so I don’t. It’s paralyzing
  • Timberry: Like a trip: fun to plan, the plan is good, but you still change it when unforeseen happens; but it was still worth it to plan. #sbbuzz
  • wifepreneur@bradfordshimp for those who don’t want a business plan a business mind map is a good way to go about planning. #sbbuzz
  • Timberry: I love the Eisenhower quote: The plan is useless; but planning is essential. #sbbuzz
    kcolaco: @ Timberry key to recognize plans are not directions but rather like map, fluidity and reevaluation helps #sbbuzz
sbbuzz: Q6 @timberry How do you decide what to pursue – angel investment, VC $, equity partnerships, more revenue sources? #sbbuzz
  • Timberry: Q6 a lot of this is about you and your strategy, there are some basic parameters … #sbbuzz
  • Timberry: Q6 for example, if you don’t have proven track record, big market, and defensibility, plus exit strategy, you are not VC compatible #sbbuzz
  • Timberry: Q6 also, angel investors tend to fit into the $100K – $800K range.#sbbuzz
  • snakejw: Q6 – good cash flow record will get you bank funding, great plan + big market = VC. #sbbuzz
  • Timberry: Q6 and the amount you ask has to match what your plan shows you need. You have to be able to relate it to good spending #sbbuzz
  • rongraham1@Timberry, important point: it’s possible to fall in the crack between six-figure angels and the four figures you can afford. LOL #sbbuzz
  • Timberry: One of the worst myths around is the business plan as a formal document coil bound and printed out and all. Only if you need it. #sbbuzz
  • snakejw: also look into gov. initiatives. many VCs now want to see you at least pursued public funding first. ie http://benfranklin.org/ #sbbuzz
  • Timberry: The legal cost of a $50K and a $500K investment is almost the same.#sbbuzz
  • Timberry: BTW, I’m a big advocate of bootstrapping if you possibly can. An investor relationship is like a marriage. And divorce is costly. #sbbuzz
    Timberry: If your plan shows that you need the big bucks, then don’t to a half vast job, get the bucks … if you can start smaller, do #sbbuzz
sbbuzz: Q6 @timberry from @eproulx What are top 3 things a new business should impart on investors/lenders to get funding or financing? #sbbuzz

  • KlehmerCSC: Q6 Good question…trying to find investors b/c the banking world has made virtually impossible! #sbbuzz
  • Timberry: I’ve been involved with both models, the hypergrowth IMO was really cool, but the grow slower and own it all also really cool #sbbuzz
  • Timberry: BTW, somewhere in the banking law is the problem that bankers aren’t supposed to invest in business plans, without hard assets. #sbbuzz
  • Timberry: Bootstrapping is starting a business with only your own money and borrowed money you pay back, no investors, so you own it all. #sbbuzz
  • GetAMC: Q6 Working capital is a viable option for small / med sized businesses as well. #sbbuzz #sbbuzz
  • Timberry: And in my case the dark side of bootstrapping was when we had at one point 3 mortgages and $65K credit card debt. Really scary. #sbbuzz
  • rongraham1@madhousefl, it’s also true that investors won’t fall over themselves to pitch in if they think we’re not investing in ourselves. #sbbuzz
  • Timberry@rongraham1 although on the other hand, from investors point of view, it’s good to have a business that can pay its principals. #sbbuzz
sbbuzz: Q7 @Timberry How do you develop relationships w/potential investors? How do you find them and how much do you share along the way? #sbbuzz

  • Timberry: Q7: I’m really impressed lately with angelsoft.net as a site that brings entrepreneurs and investors together.My angel group uses it #sbbuzz
  • Timberry: Q7: also thefunded.com to investigate possible investors. Never pitch anonymously. Choose the investors first, size, interest, etc. #sbbuzz
  • Timberry: @kcolaco although what I do see a lot of, along those lines, are the business plan competitions, really valuable experience. #sbbuzz
  • ideaAnglers: I have heard that there may be investors in your circle, and you don’t know until you start talking up your plans. #sbbuzz
  • kcolaco@Timberry true although in teh last month I have had quite a few calls from people fishing T2 and T3 mostly #sbbuzz
  • nrohrbach: Q7: @timberry, on the topic of “sharing” info, how do you get an investor interested without giving them enough to “steal” your idea #sbbuzz
  • Timberry: @nrohrbach professional investors could care less about another idea without a team to push it forward. Ideas are a dime a dozen. #sbbuzz
  • Timberry: Research your potential investors first, make sure they are for real. Real investors want deals, not ideas. #sbbuzz
    nrohrbach@Timberry, good point, I guess I’m used to the “cut-throat” design world, where people steal logos/layouts EVERY day #sbbuzz
sbbuzz: Q8 @Timberry How does the business plan as a tool change once you have reached your goals (investment or revenue)? Does it? #sbbuzz

  • Timberry: Q8 I don’t like the myth of the business plan as just a tool to get investors or lenders. To me it’s vital to ‘steering’ a business #sbbuzz
  • Timberry: Q8 to me the plan is always there, alive, and when you need to show it you dress it up like a teenage boy going to the prom. #sbbuzz
  • snakejw: Q8 – I tend to keep my business plan ahead of achieving my goals. keep raising the bar. #sbbuzz
  • bradfordshimp: Q8 – The only goal that should render the bplan complete is if your goal is to sell, in which case you get to start afresh. #sbbuzz
  • Timberry: Q8 I like the metaphor of dribbling … look up to long term goals while looking down to manage the short term too … use your plan #sbbuzz
  • deniseoberry: Q8 – I see the business plan as a dynamic document that changes over time as you achieve your goals. Not a dust collector. #sbbuzz
  • nrohrbach: Q8 @Timberry, of course we all hope to “meet” goals, but how far “behind” should we get before adjusting our bplan? Or should we? #sbbuzz
  • Timberry@nrohrbach Q8 the key to adjusting the plan is keeping assumptions in mind, so that changing the plan relates to changed assumptions #sbbuzz
  • KlehmerCSC: Q8 Once successful and you maximize your plan then show others how to be successful! Mentor others b/c you have already done it! #sbbuzz
  • Timberry: business plans aren’t about guessing the future right. They’re about managing the difference between what happened and why. #sbbuzz

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