When I started my CPA firm in May
2002, I wrote a business plan. I wrote
it because I thought I was supposed to write one….I needed something to
distribute to potential banking partners, right? I put together a bound, thirteen-page work of
autobiographical non-fiction and numerical fiction that was sure to wow anyone
that read it. I took it to my favorite
bank, walked out with a $50K unsecured line of credit, and was sure that it was
my business plan writing prowess that did it for me.
But, I know now that it wasn't. The reason I know this is that I
projected profit in the third year of my cash flow projections that I, to this
day, haven’t yet achieved. My business
plan, except for the parts that were purely autobiographical, was crap. It is comical to read it now. For a CPA, I sure put together some junky
financial information.
On what basis did he grant me
that large, unsecured line of credit? I had banked with this bank personally
for many years, as had my father and his small business. Maybe it was that. Maybe he called some people who knew me. I know for sure it wasn't due to my prowess in crafting my own financial projections.
What can we acknowledge to make
sure we aren't competing with DC Comics’ Batman Eternal #41?
You don't have Spider-Sense, so you can't predict the future.
I think that readers should assess your grasp of grammar and your ability to
use spreadsheets to prepare financial information, not commit to your version of the future as predicted in your business plan.
Ask yourself, would Bruce Wayne endorse these financial projections, or would his Board of Directors at Wayne Enterprises advise against that? Today, things change
too quickly. I think that preparing
financial projections is a good exercise (see, I used that word again), but to
think that lenders and investors hold you to those figures is folly. Unless you’re starting a business with a
guaranteed customer list and immediate, measurable profitability, the
projections are shaky at best. And, we
all know now that running a business and generating profits isn't the same as
sitting in your cubicle and sniping at your boss from a distance.
Lenders, customers, and investors buy into Hulk, not his well-crafted
anger management plan. In the small business
world, you can have a great idea for a business and be a total jerk, only to
find that no one wants to work with you.
You can be genuine, care about your work and your potential clients or
customers, and have a less-than-stellar presentation, only to find that you've impressed people with what is inside YOU, not the business plan. Today, people care far more about why you do
something than what you’re actually doing.
You can almost bet that you aren't the only person in your line of work, so it has to be about more than just the business plan.
I’m not saying that you should never
have a written business plan. I’m simply
saying that you need to call it what it is, and depend on it only for what it
can do for you. It’s an introduction to
WHY you’re starting a business, and then WHO you, as the owner, are. Blow people away with serving customers, not
with a well-bound work of fiction. Save
that for the authors.
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