Published on September 25th, 2018 | by Jose Vasquez0
The 5 Business Plan Mistakes That Can Ruin Your Startup Tech Company
If you make these mistakes in your business plan, you may decrease your chances of success.
Your business plan is the most important document for the future of your company. It’s going to set the course for your first several years of operation, and help you see the strengths and weaknesses of your core idea. Unfortunately, many new entrepreneurs make the following mistakes when drafting their first business plan, and it ends up working against them:
- Relying on assumptions over research. It’s easy to write down all your thoughts as they currently exist, but your business plan should challenge you to prove or disprove those assumptions. Everything in your business plan should come as the result of research (primary or secondary), rather than being based solely on your preexisting assumptions.
- Improvising your structure. There’s no single “right” way to make a business plan, but there are a lot of wrong ways. Instead of drafting a business plan off the top of your head, work from an existing template; you might encounter a section you hadn’t considered including.
- Projecting finances too optimistically. It’s tempting to chart an optimistic course for your business’s development, predicting revenue and profit as soon as you start selling products. But most businesses don’t achieve decent sales or profit for several months, if not years. It’s usually better to plan for the worst-case scenario than the best-case scenario.
- Ignoring competition and weaknesses. When you’re excited to start your business, it’s natural to focus on all the things you love about it, and all the strengths you imagine. But it’s more helpful and more important to focus on your weaknesses, and the threat of competition, so you can prepare for them.
- Sticking with your first draft. Almost every business plan’s first draft needs to be improved at some point. Be prepared to take notes from your first draft and put more work into your second.
As a serial entrepreneur, I’ve drafted dozens of business plans—both for myself and to help other entrepreneurs. If you need help getting your ideas on paper, or revisiting your business plan after a few years of operation, contact me today!