During the earliest stages of starting a business, the last thing you should concern yourself with is writing lengthy plans or long-winded executive summaries. It's time to kill the traditional business plan in favor of a realistic, practical tool: a one-paragraph startup plan.
You might think there's no way to write everything there is to know about your brilliant business idea in one paragraph. Guess what? You're wrong. You probably don't have much to say -- because it's likely that you haven't proved a thing yet.
A one-paragraph startup plan is exactly what it sounds like: Your entire business concept boiled down into an easily digestible format. Unlike traditional business planning that teaches people to brainstorm-write-brainstorm-write-revise-revise-execute, the goal of the one paragraph plan is to have you brainstorm-write-execute-revise-execute.
There are fundamental differences between these two approaches. The traditional route would have you finalize your entire strategy based on a hypothesis without testing or validation. The one-paragraph startup plan is designed to test your hypothesis through daily experimentation. It also serves as a fluid action strategy that grows along with your startup.
My first one-paragraph startup plan took me three days to research, brainstorm and write. On the fourth day, I was up and running. Was it the perfect plan? No, but it got me started quickly, and set me on a course to generate revenue immediately.
Here is a five-point guide to help get you started.
1. Answer key questions about your business.
To get started, you must have answers to key questions about your business and its prospective customers. Answer each of the following questions completely, honestly and in no more than one or two sentences. It is important to be confident that you can substantiate your core beliefs with relevant arguments.
- What product or service does your business provide today?
- How does your business produce or provide the product or service right now?
- How will customers use your product or service as it exists right now?
- How will your business generate immediate revenue?
- Who are the primary clients your business will target immediately?
- How will you market your startup to prospective clients with the resources currently at your disposal?
- How are you different than your competitors right now?
- What secondary and tertiary client bases you will target once you've achieved success with your primary base?
- The company produces and edits sizzle reels, which are three-to-five minute promotional videos that combine video, graphics, photos, audio, and messaging for fast-paced, stylized product overviews.
- A team of freelance editors edits together media materials submitted by its clients.
- Customers use to offer their clients overviews of products, services or brands.
- It produces revenue by charging these clients flat fees for editorial services.
- The primary clients are boutique public-relations firms.
- Marketing efforts includes cold calls, search engine optimization and networking at public-relations industry events.
- Unlike its diversified competitors that offer large service rosters, the company will focus only on producing sizzle reels.
- The company will expand its client roster to include advertising agencies and small businesses.
2. Write checklists.
This exercise is about field-testing your assumptions to learn whether they are true, false or incomplete and turn your paragraph into a functional, action plan you can revise regularly. As you learn lessons from your successes, failures and nonstarters along your journey, you can modify your plan to make it a formula for success.
Break each sentence in your start-up plan into five immediately executable steps -- statements you can convert into reality. Each step should move your business forward in some way. List each action step chronologically in a checklist format, like a to-do-list or a series of task reminders on your mobile phone or computer. Include applicable deadlines and note any related expenses. Estimate what you think the expense will be and write it down. Here is an example based on the steps to take for answer No. 5 above: The primary clients are boutique public-relations firms.
- Create a list of all boutique public-relation firms in NYC. 1/25/08
- Research contact information for each firm. 1/28/08
- Contact each prospective client to set up introductory meetings. 2/15/08
- Produce a company video reel for presentations. 2/15/08 ($200)
- During meetings with prospective clients offer a one-time discount of 50% of their first purchase.
Once you compose the checklists for each sentence in your draft plan, it's time get to work. Execute each action step as completely as possible. Keep your checklists with you at all times -- either on a mobile device or paper -- and jot down notes whenever you learn something new.
Once each task is completed, evaluate your findings with these six questions:
- What worked and what didn't?
- What was the result of each action step?
- Was the overall experience positive or negative? Why?
- What did you learn during the process?
- Which steps can be modified or improved for better results? How?
- Which need to be deleted all together?
4. Revise your draft plan.
Based on the information gathered while executing your checklists, determine whether your original assumptions in your draft plan are true, false or incomplete. My original idea about how my business would work was incomplete. Not only did I miss an entire client category, I also failed to research the right decision makers.
Sometimes you'll validate your hypothesis. In other cases, you'll see that you were far off base. Whatever the outcome, identify and plug the holes in your false or incomplete statements in your draft plan.
5. Continue to update your plan.
Scrap what failed and improve on minor successes to create home runs. Adjust your plan accordingly, so you can begin transforming each of your flawed assumptions into true and complete statements. Use your findings to create new, more educated insights and craft more in-depth, specific checklists. Repeat this process on a regular basis.
Just because you prove all of your original premises doesn't mean you're done and on your way to easy street. In fact, you're only at the beginning. Always look for ways to improve your checklists. Doing so will keep you on top of your game and allow you to produce a series of well-defined blueprints for every part of your business.
Constantly questioning and improving my one-paragraph start-up plan has led me to building a profitable, scalable company poised for strong growth in various new markets.
Your one-paragraph startup plan is a living, breathing document that has a symbiotic relationship with your business. If it dies, your business may not be far behind.
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