Top 21 startup mistakes to avoid: #3: starting without a business plan or over thinking the plan


‘For which of you, intending to build a tower, does not sit down first and count the cost, whether he has enough to finish it— lest, after he has laid the foundation, and is not able to finish, all who see it begin to mock him, saying,

This man began to build and was not able to finish’? 31Or what king, going to make war against another king, does not sit down first and consider whether he is able with ten thousand to meet him who comes against him with twenty thousand? 32Or else, while the other is still a great way off, he sends a delegation and asks conditions of peace.’ ~ Luke 14: 28-32 NKJV

Do not discount the value of a business plan

A business plan can be a powerful tool for building a great enterprise yet, many entrepreneurial startups discount it. It is not uncommon to see entrepreneurs who claim to be running successful enterprises without a business plan.In fact, many of them do not really care about a business plan if they can make some sales and keep the business running.

In the early days of the dream, it is easy to be so excited and enamored with the idea of “your” business that you fail to grind out a proper business model. It is quite common with most entrepreneurs. It is unfortunate that many businesses do not have a plan. However, without a short- and long-term plan with measurable goals and objectives, including dates and deadlines, your business will have a hard time succeeding.

Businesses without plans may not consider cash flow needs, growth, management, employees, inventory management, vendors, etc., all key factors in the success of a business. When you go through the exercise of planning, it forces you to address all those areas.

It also allows you (and potentially others) to look objectively at the business and determine if the case is compelling enough that someone would invest in it. The purpose of a business plan is to identify, describe and analyze a business opportunity and/or a business already under way, examining its technical, economic, and financial feasibility.

Simply put a business plan is your roadmap for business success. Irrespective of the viability of your idea, it is important to understand that there is extraordinarily little success, you can achieve if you lack a plan.

Do not skimp on the business plan

The value of a business plan cannot be overemphasized. Having a solid business plan plays a vital role in determining future success. A business plan, after all, serves to guide the startup in the right direction by answering the following questions:

What is the purpose of the business? Who are the potential customers or clients? What is the mission and value of this business? What is the direction desired for this business in the future? Who are the company’s competitors and what are they doing? How can the company measure its success?

From the above, a sound business plan determines every aspect of the entrepreneurial startup, and this makes it dangerous to do business without it. Besides, whenever the company is stuck or a new venture is to be launched, the entrepreneur could always refer to the business plan or what we may probably call the master plan.

There is no need to go creating a business plan in as formal a manner as someone would in business school. But having a business plan is recommended since it will help determine the company’s direction over the long term.


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