Ditching the business plan is one of the biggest trends for entrepreneurs over the last 5 to 7 years, maybe longer. The prevailing thought is that business plans are old school, and in the new lean startup world they will do nothing but collect dust as history books in the fast changing internet economy.
This is true to some extent, but as entrepreneur turned VC Mark Suster points out in his post from his archives titled Are Business Plans Still Necessary, the financial model part of the business plan remains critical.
In an era of “launch and learn” is there a need for a business plan?
Short answer: absofuckinglutely. I have seen really great product people espouse the death of the business plan. Do so at your peril.
So, definition: when I talk about a business plan I’m not talking about a 40-page Word document outlining your market approach. That died with waterfall software development. I’m not even talking about your 12-page Powerpoint presentation that you need to raise venture capital or to talk with potential biz dev partners.
I’m talking about your financial spreadsheet.