Business Plan Competition Guide to Success

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					           Business Plan Competition Guide to Success

                                   By: Adam Hoeksema




Business plan competitions are big business for startups these days. A 2009 McKinsey &
Company report found that total funds from prizes have more than tripled over the past decade
and now surpass $375 million. So what does it take to win a business plan competition?

There are typically three stages in a business plan competition.
   1. Preliminary Round - Typically applicants will submit a business plan executive summary
   2. Business Plan Round - Applicants will now submit a full business plan
   3. Presentation Round - Finalists will typically present to a panel of judges

The following guide will outline keys to success in each round of a business plan competition.

Round 1 - Executive Summary Round

Since the Executive Summary is typically the first round I will start there. Famous venture
capitalist Guy Kawasaki said in his book, The Art of the Start,

"Of the effort you put into write a business plan, 80 percent should go into the executive
summary. These are the most important paragraphs of your organization's existence."

If your executive summary is the most important paragraphs of your organization’s existence,
then your executive summary must be incredibly important in a business plan competition. The
typical executive summary will be composed of the following sections:

The Grab
Big Problem
Unique Solution
Market Potential
Unique Selling Proposition
Management Team
Financial Projections
Request

The Grab - This section does not actually have a title, but it is probably the most important part
of your entire executive summary. In two or three sentences you should tell the reader why your
business is special. Maybe you just struck a deal with Wal-Mart to distribute your products in
one of their stores on a test basis. Maybe you just signed a partnership with Google. Maybe you
were just awarded a patent, or maybe you just made your first big sale. Whatever it may be, ask
yourself "so what." Could a judge reading your executive summary legitimately say, "so what?"
If so, then you didn't do an adequate job. Obviously if you just signed a partnership agreement
with Google no one would say "so what" so grab their attention.

Big Problem - The first ingredient of a good business idea is a Big Problem, so explain the Big
Problem that your product addresses. For instance, there is too much traffic in Chicago and
everyone hates traffic. Everyone in the room should be saying "yeah I hate that."

Unique Solution - The big problem is the easy part. Now you have to convince the reader that
you have come up with a unique solution to the big problem. If you have these two ingredients
you have a good business idea. Maybe you developed a new traffic control system that will save
one minute for every person in Chicago each day during their commute. One minute each day is
valuable when you are talking about a couple million people.

Market Potential - Elaborate on the big problem by providing stats for your industry. How much
is spent annually on similar products or services and how fast is it growing. Maybe you operate
an in-home health care company. With all of the health concerns brought about by aging Baby
Boomers, you have a large market potential with a rapidly growing market.

Unique Selling Proposition - This is where you elaborate on your unique solution. What
specifically gives your product or service an advantage over the competition? Maybe your home
health care service actually sends doctors to the home instead of just nurse practitioners, or
maybe you guarantee same day visits so that you don't have to schedule ahead of time. Just
point out why you are special.

Management Team - Depending on what industry you are in, this can be one of the most
important parts of your executive summary. Regardless, your investors or bankers are putting
trust in the team, not the idea. Ideas are easy to come by, but executing on those ideas can only
be accomplished through a strong team. Quickly show why your team has the experience and
knowledge to execute your business plan.

Financial Projections - Based on your market, your business model, and your historical
performance, you need to develop a bottom-up financial forecast. If your plan is for a group of
investors, don't spend too much time on this section because they know that you have no idea
how much money you might make. Investors typically won't make a go / no-go decision based
on your financial projections. They will essentially make their own financial projections. That
being said, you should have some sort of graph or table with current sales and projected sales
going forward for at least three years.

Request - Typically you will request a loan or investment at the end of an executive summary,
but since this is a business plan competition that may not be applicable. Use your best judgment
with this section, but don't use it to summarize your executive summary! You don't need to
repeat yourself, instead maybe you could leave the reader with an intriguing and compelling
opportunity for your business. You want them to pass you to the next round, so give them a
reason to pass you on to the business plan stage.

Remember Your Audience

Not only do you need to consider each section of your executive summary, you must also
consider your audience when writing your executive summary.

Business plan competitions are difficult because a good competition organizer will bring
together judges from varying backgrounds, ages, genders etc. This will probably keep you from
targeting your executive summary toward one group of people, instead you have to take what
you have been given. Most competitions will have a set of guidelines. They may even publish a
judging criteria for you so that you know what aspects to focus on.

If they provide you these details you should start there because you can rest assured that there
will always be a few people on the judging panel that will go down the published judging criteria
list and score you directly according to the criteria . There is no sense in costing yourself points
before you even start because you did not follow the judging outline.

You should also understand that many of the judges will probably throw the criteria out the
window and judge based on their own perceptions. You need to spice up your executive
summary in a business plan competition - especially if they provide a specific criteria for judging.

How can you ensure that your executive summary stands out in a business plan competition?

   1. Quotes from Experts
   2. Disclosure of Client Lists
   3. Disclosure of other Credible Investors

Quotes from industry experts can give your business credibility. Maybe you are developing a
medical device to assist the elderly in getting in and out of bed, and you have a quote from a
distinguished doctor or maybe the CEO of a large nursing home chain that gives credibility to
your claim that there is a need for this type of device.

Listing a major client or a couple of well-known clients in your industry is also a great way to
stand out. Using a medical device example, maybe you have developed a prototype that a
nursing home chain with 10,000 beds is currently using on a test basis for just a few of their
residents. Again, disclosing this client gives your product or service credibility in the eyes of the
judges and will immediately ease concerns they may have had.

Finally, if you already have acquired an investor or investors for your business, the judges will
look at the plan with a more positive outlook simply because someone else believed in you
enough to hand over some cash. I did say credible investor though, so if you say that your rich
uncle in California gave you $15,000 to develop your prototype, that is almost meaningless.
However, if a wealthy doctor that works with the elderly gave you $15,000 to develop a
prototype, now you are starting to raise some eyebrows.

Round 2 - Business Plan Round

There are literally thousands and thousands of guides, templates, examples, articles, and
videos on how to write a business plan, so I am simply going to point you in the direction of a
couple of the best resources.

http://www.bizplanit.com/
http://www.bplans.com
http://www.sba.gov/smallbusinessplanner/plan/writeabusinessplan/index.html

Use these 3 resources to write your business plan, and just keep this one tip in mind. Most
business plan competition judges will judge numerous business plans. Write your business plan
to be exciting enough and visually appealing enough to grab and hold the attention of a judge
who has already read 5 other business plans that day.


Round 3 - Presentation Round

The last stage of most business plan competitions will be a presentation round. This is difficult
because every competition will have a different time requirement for the presentation. Some
competitions will give you 5 minutes while others may give you half an hour. Again based on
your unique business plan competition you may have to make some changes to the outline
below. Your presentation will probably be built in a similar fashion to your executive summary.
Here are the 10 slides that you should build your presentation around:

Title - Just include your organization name, your name and contact information. Don't read
this to the audience. Start off by telling them what your organization does in no more than 2
sentences.

Big Problem - What is the big problem or pain that your organization addresses? Get the
audience to recognize the pain with this slide and then provide them with your solution on the
next slide.

Unique Solution - After you have the audience nodding their head and talking amongst
themselves with comments like, "Yeah I hate it when that happens". Now it is time to reveal your
unique solution to this problem.

Business Model - We could alleviate a lot of problems if money was not an issue, but
unfortunately it is, so now explain how you are going to make money with your unique solution
to the big problem.

Unique Selling Proposition - What makes your product or service special? If you are a online
marketing firm, how are you any better than the 1 million other online marketing firms?

Competition - Thoroughly explain your competition. Acknowledge their strengths, but you can
also point out their weaknesses and where you hope to capitalize on their weaknesses. Never
Never say that you have no competition. Even if no one else makes your product, what would
keep someone from buying your product? That is your competition.

Marketing Plan - How are you going to find customers? How are you going to convince them to
take money out of their wallet and put it in yours?

Financial Projections - Either a 3 or 5 year forecast is best. Give it your best shot on these, but
don't waste too much time. What I have learned is that smart investors know that you have no
idea what kind of money you will make so they essentially disregard your projections and make
their own estimates based on everything else you have already told them.

Management Team - Teams are important because no one can build Google or Microsoft by
themselves. You need team members that can make up for your weaknesses and vice versa.
Focus your audience on your teams strengths as they will be what drives your success.

The Ask - Now it is time to ask for the funding you need. Don't ask for more than you need.
Don't ask for less than you need. Explain major milestones for your organization as well as an
expected timeline so that investors have an idea regarding the length of investment.

If you can communicate these ten areas in a clear and effective way you will be on your way
toward winning your first business plan competition.

Your presentation round will probably conclude with a question and answer period. I only have
one suggestion here. Tell the truth. When the judges are grilling you with questions you don’t
know the answers to. Don’t try make something up on the spur of the moment. If you don’t
know the answer to that question, then tell it like is. Just let the judges know that you have not
considered that before.


Where to Find Business Plan Competitions

Finally, I want to point out a couple of great resources for you if you are interested in entering a
business plan competition:

www.bizplancompetitions.com - Find all the legitimate business plan competitions throughout
the United States. This website provides a wonderful calendar that notes all of the competition
deadlines.

istart.org - This is a new site that actually allows business plan competition administrators to
organize and run the competition through the tools provided on the website. Additionally, you
can find business plans from various competitions around the world and discover businesses
that may be looking for investment.

Best of luck in your business plan competition endeavours!

Sincerely,

Adam Hoeksema
CEO & Founder - ExecutivePlan
www.theexecutiveplan.com

				
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