Note: The views & opinions expressed in these essays are strictly my own, and not those of any entity I may be associated with as an employee, consultant, promoter, investor, etc.ARCHIVES
Technology Entrepreneurship in India - Teams
Technology Entrepreneurship in India - Generating Revenue
Technology Entrepreneurship in India - Raising Capital
Equities, ETFs, F&O
Oct 2011: Equity Risk Premium for India
Jun 2011: Investing in Indian equities
Technology Enterprises in India
Nov 2010: Technology investment in India - WATER
Aug 2010: Technology enterprises in India - 3 avatars
Risk Capital for MSMEs
Mar 2010: Risk mitigation for investors in MSMEs
Mar 2010: Why don't (Indian) MSMEs get risk capital?
Feb 2010: Angel investing - Will it work for Indian MSMEs?
Feb 2010: What's so special about innovative MSMEs?
Feb 2010: Where do Indian/NRI (V)HNIs invest?
Feb 2010: Funding options for innovative MSMEs in India
Jan 2010: Innovative MSMEs in India
Do you need a Business Plan?
(Last revised March-2012, Send comments to email@example.com)
Of your two sources of cash (investors and customers), neither really cares about your business plan:
"Nothing slows down a VC as much as a comprehensive business plan." - David Cowan
Yet, you need to have one. Not a 50-page thesis, but a 4-5 page document or a set of 10-15 slides. Brevity forces clarity of thought, which in turn requires deep understanding of the critical factors for your business. If your business plan is able to concisely convey these, you're well ahead in the game of raising venture capital.
For science/technology entrepreneurs in India, creating a business plan has a side-benefit. Since GoI funding is useful during the early-stages, the effort you put into your plan can be re-used to write funding proposals for various schemes. The trick? Modularize your documents, use appendices liberally, then drag & drop!
Your plan must be frequently revised, as you learn about customers, market segments, product economics, pricing, etc. To handle this uncertainty, use finer (monthly) granularity for the first 12-18 months, but coarser (annual) for 3-5 years out. Use real-time, operational feedback to revise your monthly estimates; and let investors gauge the potential opportunity using the 3-5 year estimates.