Sunday, January 13, 2013

The Real Biz Experts: Business Plan Gurus



Interesting.  I just had an epiphany that makes the true purpose of a business plan abundantly clear.  After reading Steve Blank’s article title No One Wins in Business Plan Competitions, the mad sea of entrepreneurial tools just simplified.  Blank says that, “a business plan is the execution document that large companies write when planning product-line extensions where customer, market and product features are known.”  The operative word here is, “known”.  Certainly, there is prerequisite research entrepreneurs do to understand their market, but the reality is is that is never enough to know what’s to come.  The future for an entrepreneur is still unknown.  Blank’s article was inspired by his very public condemnation of schools that host business plan competitions.  Blank thinks judging these sorts of competitions is a waste of time.  His solution?  Building a business model instead.  Blank says that business models speak to the needs of the customer—not the market.  I like this approach.

Steve Blank has founded a business or two in his time.  E.piphany, his most recent marketing software startup.  His other startup businesses were Zilog and MIPS Computers (two semiconductor companies), and Convergent Technologies.  Convergent Technologies is a workstation company.  Blank’s list of businesses is filled with five additional startups.  Who’s knowledgeable about business plans?  This guy.

Experts are not born.  They are made.  Marshall Mitchell, Co-Founder of Different Drummer, is a dive-in-and-make-it-work entrepreneur.  He’s an expert business plan marker.  What this?  It involves a pitch, an entrepreneur’s first round business plan draft, and a big, fat red Sharpie.  Mitchell’s entrepreneurial leadership styles slap the newbie in the face with common sense.  Mitchell’s expertise scream practicality.  If it plan does not make sense on paper, it will not make sense in real life.  In a one-on-one conversation with him, Mitchell explained that, “Entrepreneurial success cannot simply be achieved.  One has to work their way into success.  Usually, that success never comes from a business plan, anyway.”  Mitchell suggests that formal business plans are purely prepared out of formality; not because the idea is good, but because some corporate know-it-all said entrepreneurs had to make them.  Again, Mitchell’s expertise is another very candid approach to this world of professional risk taking.  I like It.

Mitchell explained that investors don’t want the fluff.  They want to make sure the dollars and cents make sense.  At the end of the day, everyone is digging from the same pot of gold.  Mitchell left me with the question, “How will investors get their dough back?”
Two very strong experts have offered similar approaches and techniques to how to gain the goods from investors.  I’m intrigued by both experts because the approaches are innovative and uncommon.  How else does an entrepreneur expect to get the attention of an investor other than to be uncommon?