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5 Reasons You Should Not Make a Business Plan for Your Startup

One piece of advice you might hear as an entrepreneur is to have a business plan ready for your startup. To a certain extent, that is true; you must have some idea how your startup is going to make money. However, you should rarely go and actually put a real business plan into paper. Here are five reasons why you should pass on a plan:

 

1.    You Will Likely Ignore It

 

A business plan, a real one, is a document filled with business and legal jargon, notes, and lots of images indicating expected growth and projections. Those items are largely useless. Your startup will boil down to whether or not you can convince clients and customers to pay for your product, not whether or not you adhere to that document.

 

2.    Sticking to a Business Plan May Ruin Your Startup

 

The problem with a business plan, especially for a startup, is that it is a function of when it was made. Markets and industries can change in the blink of an eye, leaving your plan in the dust. You could find your business plan useless even before you take to the field, the document made obsolete by a product that beat you to the market.

Don’t get married to your documents. Launch the startup and get a feel for the business, the market, your product, and yourself. You will be better equipped to craft a more workable plan of action after a few months on the field.

 

3.    Your Business Plan Can Stifle Your Greatest Advantage

 

Business plans exist to be followed. They are there to guide a company at key decision points, to ensure that everything they do is focused on a singular goal. That is not a bad path to take. However, that is only applicable to an established business, one that knows exactly what works for its target market and its product.

Running a startup is a fluid endeavor. Due to how small the company is and its relative inexperience, it will need to act according to how the market reacts to its presence. In fact, it is its size that allows for such graceful pivots and changes in approach. Tying your startup to a business plan can effectively take away its greatest advantage against larger and ponderous companies — its flexibility.

 

4.    Business Plans Don’t Always Help Get You Funded

 

One of the main reasons entrepreneurs put so much time and energy into crafting a convincing business plan is because they believe it will make it easier to get funding. If you are solely relying on banks to get your funding, that might be true, but if you’re looking to venture funding or other entities for your capital, you may find that making a business plan is a waste of time.

First, a minute number of startups can even hope to get venture capital. Less than one percent of startups are chosen by venture capitalists, making that approach poor at best. Second, those that are chosen are not picked due to their business plan. Investors have hundreds, if not thousands, of businesses to look through. Most business plans will be skipped or outright ignored in favor of checking the offering, and judging the entirety of the startup on that.

 

5.    Business Plans are a Massive Energy Sink

 

You will have a lot to contend with as an entrepreneur, from figuring out your target market, to finding an iteration of your product that will appeal to them. Your mental and physical limits will be tested. Cutting out all distractions and unnecessary work is critical if you want to survive and not burn yourself out.

Business plans are one such distraction. If you know how you are going to sell your product and make money, you don’t need to do all the research and writing involved in making a business plan. Just get to work instead.

Avoid the trap of making a business plan for your startup, and you might just do well as an entrepreneur. However, that concept should not be totally ignored in the long run. Eventually, with enough experience and understanding of your startup relative to your target market, you may want to put your plans into writing. For now, stay on your toes and stay flexible.

Taskade, a simple, unified collaboration tool, is one way you can remain flexible as an entrepreneur and startup founder. It cuts down the friction in planning and decision-making, so you (and your team!) can focus on doing.

 

No steep learning curves. No complex interface. No maze of functionality. Taskade allows you to have your tasks, notes, and communication all in one place, so you can get work done, faster and smarter. Visit www.taskade.com to get started and boost your productivity!

Alexandru

Alexandru is the co-owner of TopDesignMag. “If it looks easy, it's hard. If it looks hard, it's impossible. If it looks impossible, it's due tomorrow. At 8 A.M.”