Do I really need a business plan?
Until not too long ago, and today still to a certain degree, the drafting of a business plan was considered the crucial first step to start an enterprise. The writing of this hyper-detailed and long formal document was strongly recommended for anyone, not only to be taken seriously by (big) investors but also as an effective method to take stock of your situation before opening the business.
Business plans: yes or no? The answer to this question is more complex than it might appear at first glance.
However, the new trend in the entrepreneurs' world does not recommend “old school” business plans for small startups anymore. Dwelling too much on drafting an extremely detailed document in the early stages, accordingly, could even be a waste of time.
Of course, this does not mean that business plans are no longer useful. Rather, you have to understand what your concrete needs and priorities are and, moreover, keep in mind which audience you are writing the document for. We’ll sketch a few possible scenarios to clarify the situation:
Business Plan for bootstrapping a startup
If you are going to found a small startup by bootstrapping it and the plan is that only you and your closest collaborators will read the business plan, there is no need to write a hyper-detailed text. A few pages document will be more than enough to take stock of the context that you’re going to operate in, and to detail your vision, financial situation, and enterprise goals
Business plan for bureaucratic demands
- Alternatively, certain bureaucratic procedures may explicitly require you to provide a business plan. For example, if you are an expat applying for a Startup Visa, or if you are requesting special permission concerning your zoning-plan. In these cases, you have to tailor your document in a more official way. Luckily, there are convenient prefabricated templates that you can simply fill in to complete these procedures. Remember, if you are applying for a Startup Visa, do not hesitate to ask your facilitator for guidance in this department.
Business plan for funding
- Finally, it is quite common to need a business plan in order to raise funds. In this case, you have to write an official document that is still catchy enough to impress your potential investors. Hence, if this is your situation, make sure to be meticulous and detail-oriented in drafting your business plan.
Writing a business plan
At this point, it should be clear that the question “do I need a business plan” does not have a single answer; it really depends on your situation. If you realized that your situation calls for a business plan, here you can find some useful tips for drafting a good document, and here is a guide that provides more detail on the various sections that a comprehensive business plan needs.