Do You Need a Business Plan . . .

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Very early in my career, I sought advice from a seasoned business owner.

“Do I really need a written plan?” I asked impatiently, being inexperienced. He scoffed, “Why spend six months writing a plan? Go start a business NOW!”

That was great advice, exactly what I wanted to hear. So off I went, and despite myself, I was a modest success. But in hindsight I now realize I could have been spectacular rather than modest.

If you’re an organized sole-proprietor, I imagine you can do just fine without destroying half a forest to memorialize your every proprietary insight. However, if you plan to seek funding, hire employees or otherwise engage in activities to facilitate growth – you’ll find you really need some place other than your head as a repository for your entrepreneurial vision.

The need for a formal business plan within small to medium enterprises (SMEs) is often the $64,000 question. If you’re seeking venture capital or other external financing, let’s calls it a $6.4 million pre-money consideration, because without a business plan you are not likely to get your hands on other people’s money.