Business Plan - The Importance to your company - The “Business Plan” is the first and foremost document that should be prepared by a startup company. The Business Plan is the roadmap for the future of the company.

It is a statement of the goals of the company, explains why the principles believe that the goals are attainable, and describes the plan for reaching the goals.

The Business Plan should be used by the principals of the company as their own outline for success, but could also be used to obtain operating capital through investors.

A good Business Plan will contain a lot of excellent information about the company, its principles, its goals, the direction that the company is taking, the financial projections for the next two years or more, the need for additional capital, how that capital will be raised, the expected return on investment and other details.

While the company Business Plan should be written in-depth by the principles of the company, using the best information that they have at their disposal and should be as accurate as possible, it is recognized that circumstances change over time and a Business Plan may need to be brought current using fresh information.

If the principles of a company have not had experience in developing a good Business Plan, they should seek assistance from those that are experienced in doing so. The Business Plan can be extremely important in letting others, especially investors, learn all about the company.

Business Plan – Description - Wikipedia

Business Plans & Financial Statements Template Gallery – Score

All about the Business Plan Myownbusiness

Entrepreneur How to create a business plan

The Executive Summary - The Executive summary is usually the first page or couple of pages of the business plan of the Company and is often considered the most important section of the business plan.  The executive summary will briefly tell a potential investor whether an investment in the company is of interest to him.  The Executive Summary will tell the reader what your company is about, what stage you are at this time and where you want to go.  The Executive summary must be short, not more than two pages, very concise and informative.  How well the Executive Summary is written can very well determine if a potential investor will want to look further at the company.  It is therefore very important to give a lot of thought and effort into the Executive summary.

If the Executive summary is going to highlight the strengths of your overall plan, it should be written after you have completed your business plan, even though it will appear at the beginning of the business plan.

There are certain ways that an Executive Summary should typically be structured:

• the Executive summary must be able to be read separately from the business plan should be short – a couple of pages
• should be written in language that is appropriate for the target audience.
• consist of short and concise paragraphs
• start with a summary of the business – briefly describe products, services, etc.
• It should be written in the same order as the business plan
• It should contain only the same material that is in the business plan
• It should provide a justification for investing
• It should have a conclusion

Some things that the Executive summary should highlight:

1.  What stage the company is.  (startup, second stage, etc.)  (see “Stages of Investment Capital”)

2.  The Mission Statement of the company.  Explain what the business is about in a a few sentences.

3.  Company information – Include a short statement that covers when your business was formed, the names and experience of the founders and their roles, your number of employees, and your business location(s).

4.  Growth highlights – this could include financial growth, product development, and any other information that shows that the company has made progress since inception.

5.  Descriptions of products and services – describe briefly any products of services offered by the company.

6.  Financial information – this would include money raised to date, information about investors, how much money is needed and the use of proceeds.

7.  Summarize your future plans for the company.  What do you see for the future?

Executive summary – description - Wikipedia

Business Plan Executive Summary – U. S. Small Business Administration

PRO FORMA - The Pro Forma describes a method of calculating expected financial results of a company, including current and future projected figures. 

Pro Forma of a company is extremely important to potential investors because it is the pro forma of the company that will help them to determine their level of interest in investing.  Pro Forma indicates their possible return on investment and the time frame.

The Pro Forma of the company is usually developed around the stage of the company, and the use of proceeds.  Is the use of proceeds of money being raised for product development, marketing, acquisition, etc. and what is expected to be accomplished by the additional the investment capital.  Pro Forma should be for at least three years.

It is important that the Pro Forma of the company is completed after much research, calculations and thought.  Usually, if the pro Forma shows extremely high growth in a short period of time, an investor may question the reliability of the method of calculating the Pro
Forma.  What the officers of the company doing the Pro Forma usually do not take into consideration is the “unknown”.  This is simply because they do not know the “unknown”.

However, in almost all situations there will be an “:unknown” that will have a dramatic effect on the actual results of the Pro Forma, usually to the negative. 

Be conservative on the Pro Forma for the future years of the company.  If a conservative figure still makes the results of the company good, then if things go better, it will make investors happy.

Pro Forma – description - Investopedia

Prof forma – description – Wikipedia