Venture capital is the money that businesses get from investors to start or continue a business. Ironically the advantages of a business plan are also correlated with some of the disadvantages of a business plan.
For instance, a book entitled Under the Radar: Starting Your Net Business without Venture Capital, Venture capitalists often find that many business plans are too optimistic (Kling 2001). The book asserts that,
Trying to obtain venture capital funding without a business plan is like trying to get into college without filling out an application. Ironically, however, even venture capitalists are skeptical about business plans. Any venture capitalist will tell you that a first-rate team with a second-rate business plan is preferable to a second-rate team with a first-rate business plan. In fact, when I listen to venture capitalists describe how they make their decisions, the process often sounds highly intuitive and almost romantic — like the scene in the movie Jerry Maguire where his girlfriend says, “You had me at Hello.” Venture capitalists often complain that the business plans they see are ridiculously optimistic (Kling 2001).”
How to make a good business plan
Indeed a good business plan should certainly contain all of the above-mentioned elements. In addition, the plan should encompass the full scope of business operation and clearly define the goals of the business. In addition, it should contain pertinent financial information about the business. Having such information will prove beneficial when the company attempts to secure venture capital or other types of funding.
A good business plan should also be realistic concerning their goals and the overall outlook for the company and industry.
The business owners should be optimistic but also realistic about what the business can accomplish. Overall, a good business plan should sum up the goals and accomplishments of the business.
The purpose if this discussion was to focus on the following perspectives, the theory of small business, the definition of a small business, advantages and disadvantages of small businesses. In addition, we also discussed small business plan, the development of such a plan and the advantages and disadvantages of a business plan. Our discussion found that the definition of a small business is dependent upon the industry to which the business belongs. We also found that small business is at the forefront of economic productivity throughout the world. The discussion also found that the creation of a business plan is crucial and essential to a successful business. The investigation suggest that a business plan allows a business to secure funding.
Writing the Plan. Small Business Administration. http://www.sba.gov/starting_business/planning/writingplan.html
What is a Small Business. Small Business Administration. http://www.sba.gov/size/
Vital Role of Small Business Demands Greater Recognition. 2002. Canadian Speeches. Volume: 16. Issue: 5. Publication Date: November-December 2002. Page Number: 46+.
Anglund. Sandra M. 2000. Small Business Policy and the American Creed. Praeger: Westport, CT.
Kling, Arnold. 2001. Under the Radar: Starting Your Net Business without Venture Capital.Perseus: Cambridge, MA.
Odaka, K., Sawai, M. Small Firms, Large Concerns: The Development.