tailieunhanh - PORTABLE MBA IN FINANCE AND ACCOUNTING CHAPTER 9

9 THE BUSINESS PLAN. Andrew Zacharakis. The sole purpose of a business plan is to explore and answer questions—critical questions starting with whether the business idea is a viable opportunity. During the dot-com boom of the late 1990’s, many entrepreneurs and venture capitalists questioned the importance of the business plan. | 9 THE BUSINESS PLAN Andrew Zacharakis The sole purpose of a business plan is to explore and answer questions crit-ical questions starting with whether the business idea is a viable opportunity. During the dot-com boom of the late 1990 s many entrepreneurs and venture capitalists questioned the importance of the business plan. Typical of this hyperstartup phase are stories like James Walker. He generated financing on a 10-day-old company based on a bunch of bullet points on a piece of paper. He added It has to happen quick in the hypercompetitive wirelessInternet-technology world. There s a revolution every year and a half now Mr. Walker Media stories abounded of the whiz kid college dropout who received venture capital zoomed to IPO initial public offering and cashed out a multimillionaire in 18 months or less. The mythology of the dot-com entrepreneur was that he didn t have a business plan only a couple of PowerPoint slides. That was all it took to identify the opportunity secure venture backing and go public. Why spend the 200 hours or so that a solid business plan often takes The NASDAQ crash of March 2000 and the subsequent death of many dot-com high flyers provides the clearest answer. Many of these businesses didn t have the potential to make profits not then not now and not anytime in the future. The easy money and quick returns of the late nineties have disappeared and what we are left with is the fact that good opportunities need good execution in order to succeed and a rigorous business plan process can assist in the pursuit of entrepreneurial gold. There is a common misperception that a business plan is primarily used for raising capital. Although a good business plan assists in raising capital the 260 The Business Plan 261 primary purpose of the process is to help the entrepreneur gain deep understanding of the opportunity he or she is envisioning. A business plan tests the feasibility of an idea. Is it truly an opportunity Many a would-be .