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Are You Facing A Business Plan Event?

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Are You Facing A Business Plan Event?

By Tim Berry, Guest Blogger
Published: September 25, 2012 Updated: September 26, 2012

For years now I’ve thought of business planning in terms of the special case that I call a business plan event.

The business plan event is when you have to produce a business plan for some specific business hurdle or gateway. For example, a startup looking for either angel investors or venture capital needs a business plan to give to interested potential investors. And a business applying for commercial credit needs a business plan to present to the loan officer at the bank. Some other business plan events are the sale of a business, a divorce affecting ownership, and applying for a merchant account to be able to process credit cards.

The world of entrepreneurship and small business divides into two groups: those that need a business plan because they have the business plan event, and those that don’t need the plan for the event, but can still benefit from business planning as part of the normal management process.

Which are you?

If you have that business plan event coming up, I recommend you prepare the business plan to best address the specific needs. Here are some obvious cases:

  • A business plan for investors should include information on the management team, the opportunity, scalability, defensibility, market potential, growth potential, and exit strategy.
  • A business plan for commercial lenders should include information supporting the business’ ability to repay loans and cover interest. Evidence of stability is very important. Owners’ backgrounds and credit ratings usually matter a lot.

Furthermore, with business plan events, the form of the business plan depends on the nature of the event. When you’re developing the plan for some specific outsiders to process, the best thing to do is to ask them, specifically, what they are looking for.

  • In some cases, your outsider will want a document printed on paper and organized for easy reading, with a table of contents, executive summary, and appendices.
  • In other cases, your outsider will be perfectly happy with a business plan published on the web, password protected, but updated behind the scenes and available whenever the reader wants. 
  • In most of these cases, brevity is important. Make sure the formal plan is easy to read and organized well enough to make it easy to find the different kinds of information quickly.

And what if you don’t have that event? Theoretically, at least, in that case you don’t need a business plan. But you do still want a business plan to help manage your business. It may not be a document-it may not be polished and edited-but it should still summarize your strategy and what is supposed to happen. It’s for you, not for outsiders. It’s about optimizing management by setting goals, objectives and performance measurements and then tracking results, reviewing and revising. The plan becomes the first step in a business planning process, which includes staying flexible and reviewing and revising monthly.

And that plan, for you and your team only, can stay on the computer, not be polished, and help your business. 

About the Author:

Tim Berry
Tim Berry

Guest Blogger

Founder and Chairman of Palo Alto Software and, on twitter as Timberry, blogging at His collected posts are at Stanford MBA. Married 46 years, father of 5. Author of business plan software Business Plan Pro and and books including his latest, 'Lean Business Planning,' 2015, Motivational Press. Contents of that book are available for web browsing free at .


Very wonderful and informative piece. Does anyone know a resource where I gain insight on working with business partners? Such as the stakes each has to make and over coming relationship bumps?
Business plan is necessary for starting a new business. It helps to shape and lead your business in the right way. Also, it is quite helpful for the investors and commercial lenders as well.
I m sure if this blog is translated in german language a lot of people will visit it. This post was edited to remove a link. Please review our Community Best Practices for more information about how best to participate in our online discussions. Thank you.
A business plan can be very helpful and a daunting task. However, having one for your business if very important.
Very helpful article! I start an online business and try to write a plan to act every day. It makes me focus on my goals!
in my work, planing is the most important! Theoretically, with me if you haven't a business plan, almost 60-70% are fail.
I agree, as a small business owner, you are the advertiser, HR, payroll and work scheduler. Planning is a must.
I agree, planning is always the key! Nobody will be successful without planning.
A business plan is always important when it comes to handling a business whether a start up or a business already been established! It's quite a problem though how some business entrepreneurs try to forget the importance of this! A low quality business plan surely will give a big draw back to the business. Some great points pal! Good job.

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