September 9, 2008

Business Plan: Management Section

A lot of my clients want to know what to put in this section.  As in all sections of the business plan, this section should be concise, but at the same time, don’t hold back on your unique points of difference/value.  I advise three things in this area (with one and two being the most important):

  1. Successful experience you have doing the same function somewhere else.  For instance, it is best if your VP of Sales and Marketing, has been a successful VP of Sales and Marketing at a different company in the same industry.  This would be considered direct functional experience.
  2. Successful experience starting a business/other entrepreneurship skills.  If it is the same type of company in the same industry, all the better; but really this is where you show you have general entrepreneurship skills.
  3. Relevant Education.  Perhaps the least important if you have 1 and 2 covered, but nevertheless an asset.  If you have a BA in English and you are starting a high-tech company, it is probably a waste of time to mention your degree.  If you have a PhD in Computer Science, however, don’t leave it off.

Remember, there are many great ideas that don’t come to fruition because of mediocre management.  Investors understand this very well.  Ideally you will have a complete management team that meets the above three requirements. …but don’t be discouraged if you don’t have an ideal management team to date.  It doesn’t mean you can’t get funded.  Strive to create the best team you can.  Not only will it help your funding potential, but your long-term success as a business.

For entrepreneurship topics and tips not related to fundraising see Lance’s blog Entrepersonal.