Tag Archives: NVC

Don’t Shade Your Eyes, Summarize

What if you had to take the classic business plan, developed for an MBA-level venture competition, and shrink it down to 10 pages?

Last Friday I spent a fun and fascinating day as a semi-finals judge at the University of Oregon New Venture Competition. My part of the program was evaluating four ventures developed by MBA students from Clemson, Northwestern, Penn State, and Michigan, along with three other judges. That was one of five flights, so there were 20 teams, selected from more than 100 entrants.

The new rules for this year gave them 10 pages for the business plan, plus up to 10 pages for appendices. The judges loved it, of course, because we have to read all the plans. The teams had mixed feelings.

Summarize. In this context, the venture competition, with teams of smart MBA students, it should have been duck soup (although that particular expression isn’t that popular at the University of Oregon, because the home team is the Ducks).

Keep the highlights. Stick to the headlines. Summarize. I don’t care if you’re the next big thing, with an unimaginably exciting new idea and a great team, you can still create a meaningful summary in 10 pages.

Start with a one-page summary. Then tell a story about the need, and your solution, your market, your secret sauce, your strategy, and your great team. Add in a financial summary, and don’t forget to highlight your capital needs, valuation, and exit strategy. If you do no more than 3 paragraphs in any one of these 10 main topics, you ought to be able fit that in 10 pages using a lot of bullet points and white space. Make it an attractive document that the judges, who tend to have older eyes, can read. Leave some space for some snappy graphics, a bar chart or two, and then include the financials in more detail in the appendices.

Some of the teams struggled too much with the page limitation. Some chose the dark-side option, filling the page with dense, small text. Some skipped important topics.

As we get used to these competitions, with page limitations growing more common, I’m expecting more teams to realize that there ought to be a master plan, from which these summary plans, and the presentations, and the elevator speeches, are just alternative output.

Once they get that, they should then start thinking more about the combined communication impact of the plan, the presentation, and the other elements. Can they summarize strategy briefly in a plan, and then explain it more in a presentation? I think so.  The plan and the presentation obviously overlap, but they both don’t have to cover exactly the same territory.

So today my business plan judging marathon month continues. After the event in Portland over the weekend, this evening I’m going to a three-hour meeting of the Willamette Angel Conference, reviewing business plans, listening to presentations, doing due diligence on plans.  On Thursday I leave for Houston, to judge the Rice University Business Plan Competition.

True Story: 75 Business Plans in a Month

Sometime in middle May you might find me emerging, blinking, uncomfortable from the sunlight, after reading and evaluating 75 or so business plans in a single month. And watching and judging and asking questions about almost as many presentations. I can see the headline:

Man reads 75 business plans in a month … and lives to tell about it.

Does that sound like a complaint? I hope not. Actually; there’s a touch of bragging to it. I couldn’t have spent the last 30 years focused on business planning if I didn’t like reading them (although, perhaps, maybe it would be better without so many all at once).

This is business plan season for me. I just finished reading half a dozen plans for Notre Dame’s annual business plan competition (we, Palo Alto Software, give a prize to the best one), and another half dozen plans for the Rice Alliance business plan competition (I’m a judge, and we have a best business plan prize for that one too). I still have to read five plans for the University of Oregon’s New Venture Competition next weekend (I’m a judge), and I’m supposed to produce a first-cut on 43 plans for the Willamette Angel Conference (I’m one of the angel investors) by the end of the workday today.

Oh, and this is the season I teach my Starting a Business class at the University of Oregon, so I’ll have another 20 or so plans to read as part of the class.

Despite all this, I’m very disappointed that I have to miss the University of Texas’ Moot Corp Competition this year, because of a scheduling conflict. That would have been another half dozen or so plans, also this month.

So don’t tell me, please, that nobody reads business plans. I do. So do the other judges. So does a whole team at Palo Alto Software. And so do all the other members of the angel investor group I’m in.

So you’d like tips, hints, suggestions? If you wrote one of those plans then it’s too late for you to change it now; but maybe I can influence your presentation. And also, maybe if I comment on some of the business plans I’m reading while I’m reading them, it might help somebody else with a plan later on.

All for the greater good, I’m sure.

Maybe I’ll make it a category, like “the business plan marathon,” or something like that. So you can click for related entries. Tim’s folly, perhaps.

And just to kick this off, some points worth noting:

  • Profitability too high: I’m not impressed with a plan promising 40%, 50% or more net profit on sales. That doesn’t mean the business is very profitable; it means they’ve underestimated expenses.
  • Dense text: Particularly dense scientific text. I’m a business reader, I’m not going to evaluate your science anyhow. I’ll just look at your degrees and past work to see whether that makes your claims credible. Maybe the patents, too, but patents don’t mean much unless they’re good strong patents with a lot of legal work supporting them.
  • Missing tables and charts: For example, I want a bar chart to show me the highlights — projected sales, gross margin, and net income, for the first three years, or five years if you insist. I want to see the projected income table in detail, so I can track things like marketing expenses and payroll. I want to see cash flow table. I want to see startup costs, and what the proposed investment is going to buy the venture. 
  • Treasure hunts: Don’t make me hunt around to find exit strategy, valuation, defensibility, market focus, or any other key point. Make it all easy to find, please.