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Write a business plan

• Review templates and tools for developing and pitching your business plan.

Public Web sites:

Small business administration.

The "Small Business Planner" section has a specific page of resources to guide you when creating this essential component for getting your business started.

Start-Up Resource Center

An Inc. Magazine Web site offering a useful and thorough how-to guide with advice and ideas on Structuring a Business Plan .

Additional information on Business Plans is available at the Arthur Rock Center for Entrepreneurship. There is also a classic article written by Professor Bill Sahlman on How to Write a Great Business Plan .

Updating a Classic: Writing a Great Business Plan

• A business plan can't be a tightly crafted prediction of the future but rather a depiction of how events might unfold and a road map for change.
• The people making the forecasts are more important than the numbers themselves.
• What matters is having all the required ingredients (or a road map for getting them), not the exact form of communication.
• The best money comes from customers, not external investors.

Sean Silverthorne: " How to Write a Great Business Plan " has been one of the most downloaded articles on Harvard Business Publishing since you wrote it in 1997. Why do you think you hit a nerve?

Bill Sahlman: Writing a business plan is a seminal moment in the life of a new venture. Doing so entails committing to paper a vision of the factors that will affect the success or failure of the enterprise. People take the exercise very seriously and get emotionally invested in what they produce.

In that context, the article was written to give insights into how to think about the role of a business plan and its relation to new venture formation. I tried to explain that a business plan can't be a tightly crafted prediction of the future but rather a depiction of how events might unfold and a road map for change. I emphasized the notion that successful entrepreneurs constantly seek the right mixture of people, opportunity, context, and deal. They anticipate what can go wrong, what can go right, and they try to balance risk and reward.

Over the years, I have received many e-mails from folks trying to craft a business plan. They want feedback. Actually, they really want me to say that they are on the right track. I explain that I would need to get to know them and their opportunity much better than what is possible in an e-mail and that the written document is not as important as the people writing it. It's not science—it's art and craft.

Q: In the decade since the original article came out, business conditions have changed. If you were writing this piece today, would you change it much?

A: I don't think the world has changed materially. Successful ventures still have competent people pursuing sensible opportunities, using resources that help, in a favorable context. Yes, the context is very challenging today. But challenges create opportunities.

If gaining access to capital is hard, sometimes that means there will be fewer competitors. This period is almost the antithesis of the Internet bubble when everyone could raise money and start a company regardless of how lamebrained the idea. Also, we have difficult factor markets like energy, but that simply means that there are great opportunities for people with ideas for alternative energy.

Were I rewriting the article today, I might emphasize the importance of controlling your destiny by being conservative about access to capital. Many great ventures in the Internet era (pre-1999) ended up failing because they assumed they would have continued access to cheap capital. Many of those businesses failed, though the underlying idea was sensible. Similarly, we have seen a period when capital markets got ugly, which has a negative effect on all ventures, sensible and nonsensical.

I would also reinforce the idea that entrepreneurship is critical around the world. We are confronted with many crises from health care to the environment to global poverty. Solutions are likely to come from talented private sector and social entrepreneurs.

Q: You wrote in the original article that most business plans "waste too much ink on numbers and devote too little to the information that really matters to intelligent investors." Still true today? What really matters to investors?

A: When there is great uncertainty in the market, investors become quite risk averse. They will only back proven entrepreneurs with truly compelling ideas. People make the numbers, not conversely. So, I still think the people making the forecasts are more important than the numbers themselves.

Q: More and more entrepreneurial ventures are "born global": They seek to address a global market and attract funding from global investors. Should a business plan be tailored in some way for a global audience?

A: We live in a world of democratized access to ideas, human capital, and money. There are fabulous global ventures being started in every corner of the globe. These ventures can raise money locally or globally. They can disperse talent in many countries.

Take a company like Skype. When I visited Skype several years ago, it had 125 employees from 23 countries. The development team was in Estonia, and its headquarters in Europe. Skype had raised seed capital in Europe and in the United States. That's the new model.

Q: On the technology front, software applications such as Microsoft Word, Excel, and PowerPoint have added many charting, graphing, and visualizing capabilities. Some business plans are even written as Web pages. Should entrepreneurs avail themselves of these tools for business plans, or do they clutter the message too much?

A: On the first floor of the Rock Center at HBS there is a copy of the original business plan that Arthur Rock wrote for Intel some 40 years ago. It's only a few pages long, but it describes an outstanding team pursuing a new technology. I have seen compelling business plans in the form of a few PowerPoint slides, a couple of scribbled pages, and a brief video. What matters is having all the required ingredients (or a road map for getting them), not the exact form of communication.

Q: If you were to update your "Glossary of Business Plan Terms" and what they really mean ("We seek a value-added investor" really means "We are looking for a passive, dumb-as-rocks investor"), what current terms would you include?

A: The glossary holds today. I think entrepreneurs, investors, and employees need to be suitably skeptical about what they read in business plans. I have read perhaps 5,000 plans and have only seen three companies really meet their plan. That sounds like a pattern to me. If anyone makes a bet based on the company doing exactly as written, he or she will be sadly disappointed.

At the same time, every player has to be somewhat optimistic about the possibility of overcoming inevitable setbacks. I think of ventures as roller coasters, not rocket ships.

Q: Any general advice to entrepreneurs seeking funding in the uncertain capital markets of today?

A: The best money comes from customers, not external investors. I think entrepreneurs need ideas that are so compelling they can get early money from customers. I also believe that great teams with great ideas can continue to access capital on quite attractive terms from outstanding investors. If the short term looks unsettled, that often means that focusing on the long term has a big potential payoff.

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How to Write a Winning Business Plan

By: Stanley R. Rich, David E. Gumpert

A well-conceived business plan is essential to the success of an enterprise. Whether you are starting up a venture, seeking additional capital for an existing product line, or proposing a new…

• Length: 7 page(s)
• Publication Date: May 1, 1985
• Discipline: Organizational Behavior
• Product #: 85314-PDF-ENG

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A well-conceived business plan is essential to the success of an enterprise. Whether you are starting up a venture, seeking additional capital for an existing product line, or proposing a new activity for a corporate division, you will have to write a plan detailing your project's resource requirements, marketing decisions, financial projections, production demands, and personnel needs. The plan must reflect the viewpoint of three constituencies: the customer, the investor, and the producer. Too many business plans focus excessively on the producer.

Learning Objectives

To ensure that one's business plan includes proof that a large market exists for the proposed offering and that it addresses investors' concerns, such as when they can cash out.

May 1, 1985

Discipline:

Organizational Behavior

Harvard Business Review

85314-PDF-ENG

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Write a Business Plan

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Instructor: Google for Education Course

Define and organize your business’s growth by writing a business plan.

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How to Write a Winning Business Plan

• Stanley R. Rich
• David E. Gumpert

The business plan admits the entrepreneur to the investment process. Without a plan furnished in advance, many investor groups won’t even grant an interview. And the plan must be outstanding if it is to win investment funds. Too many entrepreneurs, though, continue to believe that if they build a better mousetrap, the world will beat […]

The Idea in Brief

You’ve got a great idea for a new product or service—how can you persuade investors to support it? Flashy PowerPoint slides aren’t enough; you need a winning business plan. A compelling plan accurately reflects the viewpoints of your three key constituencies: the market , potential investors , and the producer (the entrepreneur or inventor of the new offering).

But too many plans are written solely from the perspective of the producer. The problem is that, unless you’ve got your own capital to finance your venture, the only way you’ll get the funding you need is to satisfy the market’s and investors’ needs.

Here’s how to grab their attention.

The Idea in Practice

Emphasize Market Needs

To make a convincing case that a substantial market exists, establish market interest and document your claims.

Establish market interest. Provide evidence that customers are intrigued by your claims about the benefits of the new product or service:

• Let some customers use a product prototype; then get written evaluations.
• Offer the product to a few potential customers at a deep discount if they pay part of the production cost. This lets you determine whether potential buyers even exist.
• Use “reference installations”—statements from initial users, sales reps, distributors, and would-be customers who have seen the product demonstrated.

Document your claims. You’ve established market interest. Now use data to support your assertions about potential growth rates of sales and profits.

• Specify the number of potential customers, the size of their businesses, and the size that is most appropriate to your offering. Remember: Bigger isn’t necessarily better; e.g., saving $10,000 per year in chemical use may mean a lot to a modest company but not to a Du Pont.
• Show the nature of the industry; e.g., franchised weight-loss clinics might grow fast, but they can decline rapidly when competition stiffens. State how you will continually innovate to survive.
• Project realistic growth rates at which customers will accept—and buy—your offering. From there, assemble a credible sales plan and project plant and staffing needs.

Address Investor Needs

Cashing out. Show when and how investors may liquidate their holdings. Venture capital firms usually want to cash out in three to seven years; professional investors look for a large capital appreciation.

Making sound projections. Give realistic, five-year forecasts of profitability. Don’t skimp on the numbers, get overly optimistic about them, or blanket your plan with a smog of figures covering every possible variation.

The price. To figure out how much to invest in your offering, investors calculate your company’s value on the basis of results expected five years after they invest. They’ll want a 35 to 40% return for mature companies—up to 60% for less mature ventures. To make a convincing case for a rich return, get a product in the hands of representative customers—and demonstrate substantial market interest.

A comprehensive, carefully thought-out business plan is essential to the success of entrepreneurs and corporate managers. Whether you are starting up a new business, seeking additional capital for existing product lines, or proposing a new activity in a corporate division, you will never face a more challenging writing assignment than the preparation of a business plan.

• SR Mr. Rich has helped found seven technologically based businesses, the most recent being Advanced Energy Dynamics Inc. of Natick, Massachusetts. He is also a cofounder and has been chairman of the MIT Enterprise forum, which assists emerging growth companies.
• DG Mr. Gumpert is an associate editor of HBR, where he specializes in small business and marketing. He has written several HBR articles, the most recent of which was “The Heart of Entrepreneurship,” coauthored by Howard. H. Stevenson (March–April 1985). This article is adapted from Business Plans That Win $$$ : Lessons from the MIT Enterprise Forum, by Messrs. Rich and Gumpert (Harper & Row, 1985). The authors are also founders of Venture Resource Associates of Grantham, New Hampshire, which provides planning and strategic services to growing enterprises.

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• Strategic Plan 2020-2025

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_____________________________________________________________

Introduction

Mission Statement

Strategic Plan

Implementation.

The Harvard Hillel Board of Directors and staff, under the guidance of the strategic planning committee, developed this 5-year plan to direct their efforts to meet the newly crafted [proposed] mission.

The creation of this document is only a first step in achieving Harvard Hillel’s objectives. The next step is to further develop the appropriate plans, action steps, and timeline to meet the goals.

During the implementation of the plan, it is the Board’s responsibility to ensure that the organization, through the actions of professional staff, is meeting its goals by monitoring progress on a regular basis and evaluating performance against each goal.

This is a working document, a tool to help Harvard Hillel achieve its goals. As such, it may be adjusted and modified as needed to support the changing environment and the needs of the organization.

Harvard Hillel is a Jewish home on campus that seeks to:

• Welcome students to experience the variety of Jewish identity, tradition, practice, values, culture, and community.  
• Inspire and enable Jewish connection, celebration, and action.  
• Prepare students to join, create, shape, and lead Jewish communities; strengthen the Jewish people; and live proud Jewish lives.  
• Share Jewish sources, traditions, ideas, and innovations, and their relevance in our world.  
• Forge connection and engagement with the State of Israel.  
• Foster friendship in a nurturing and refreshing sanctuary amid the stresses of student life.  

Engage the unique opportunities of Harvard and make Jewish thought and culture integral in the life of the University.

Goal 1: Undergraduate Students

Expand undergraduate outreach and engagement to connect with all Harvard College students who have a Jewish identity to inspire and support them in forging Jewish life.

Goal 2: Graduate Students

Build a Jewish community among Harvard graduate students and Harvard-affiliated young adults.

Goal 3: Community Engagement

Raise the profile of Harvard Hillel on campus and beyond.

Goal 4: Facilities and Rebranding

In service of Goals 1, 2, and 3, ensure that our physical space supports our new and expanded offerings and explore rebranding Harvard Hillel.

Undergraduate students who have a Jewish background/identity are the heart of our work at Harvard Hillel. We serve as a home base and hub of activity for all Jewish students. We support students along their unique paths, contributing to a meaningful Jewish life which sustains well after they graduate. We embark on this strategic plan resolved to know every Jewish undergraduate student at Harvard by name, to deepen relationships with and among students, and to use our knowledge of real student needs and interests to continue to offer dynamic programming for the diverse group of students in our care.

Strategy 1: Data Collection

Improve collection, analysis, and use of data to achieve greater understanding of our target population, discern and further develop effective engagement strategies, and sustain engagement with all students we identify.

• Survey students at least annually to understand their needs, measure their satisfaction with our programs and determine the impact Harvard Hillel has on their Jewish identity.

Strategy 2: Outreach

Increase the frequency and continually evolve the mix of outreach initiatives and programs to identify and involve all Harvard College students with a Jewish background/identity.

• Augment our peer-elected Undergraduate Steering Committee with an appointed student leadership team focused on outreach and engagement.
• Ensure outreach and engagement work is a consistent year-round focus, beyond current seasonal pushes (which include Freshman Week, High Holidays, Shabbat1000, Housing Day, Passover, Visitas).
• Strive to have at least 75% of Jewish undergraduate students attend at least one Harvard Hillel event per year.

Strategy 3: Engagement

Increase the number of Jewish Harvard College students* who have deeper or more frequent involvement with Harvard Hillel.

• Further nurture and support our existing community of highly engaged students.
• Cultivate a broader set of undergraduate affinity groups within Harvard Hillel.
• Increase collaborations with student affinity groups on campus through joint programming and offering our facility to host collaborative events.
• Attract students by multiplying opportunities for student-faculty encounters.
• Expand program offerings which educate and expand upon students’ cultural fluency so that they can lead meaningful Jewish lives.
• Create opportunities for current students to develop relationships with Harvard Hillel professional staff to that we can support each student on their unique Jewish path.
• Strive to have at least 35% of Jewish undergraduate students attend 6 or more events or 1 or more immersive experiences.

Strategy 4: Professional Development

Provide ongoing professional development for the Harvard Hillel staff in outreach and engagement to improve effectiveness.

• Partner with peer campuses for staff training in outreach and engagement.
• Take advantage of Hillel International programs to learn from the field.

*Note: future references throughout this document to “Jewish” students, or similar terms, are meant to encompass broadly those who have Jewish identity or background.

Approximately 2500 Jewish graduate students are enrolled in Harvard's eleven graduate and professional schools. Transforming this large and currently underserved population of Jewish young adults into a community is a worthwhile objective in itself and will broaden our reach as Jewish enrollment in Harvard College has declined. Creating a graduate student community requires a distinct and robust programmatic approach. In addition, a large local age peer community is greatly enmeshed with Harvard graduate students in Jewish life, presenting a challenge of mission scope, but also the possibility of partnerships with other organizations. The goal of Jewish graduate student community demands the most structural change – to staffing, facility, and funding – but we believe the opportunity is compelling.

Strategy 1: Data Collection

Collect data to better understand the needs and opportunities to engage Harvard graduate students and Harvard-affiliated Jewish young adults.

• Conduct an environmental scan of other Hillels and Jewish organizations who actively engage graduate students.
• Survey and conduct focus groups with Harvard Jewish graduate students to determine the type of programming which will meet their interests and needs.
• Improve our data on Jewish graduate student populations in Harvard’s eleven graduate and professional schools, in order to improve communication, visibility, and outreach. 

Strategy 2: Leadership

Create and staff a Council of the Jewish Student Association (JSA) heads from across schools for collaborative planning and programming.

• Work with JSA’s to identify and reach all Harvard University graduate students with a Jewish background/identity.
• Hire graduate student interns to support JSA Council initiatives.
• Increase communication and visibility of the Harvard Hillel “brand” in the graduate school communities.

Strategy 3: Programming

Expand our programming and the calendar of events to build community across graduate schools and engage graduate students in Jewish life.

• Host more of our highly popular social gatherings for graduate students.
• Involve graduate students and young professionals regularly in each of Harvard Hillel’s denominational prayer communities.
• Support small group “clusters” for Shabbat meals and Jewish learning.
• Multiply opportunities for encounters among students and faculty across Harvard schools and young professional communities.
• Increase mentoring of undergraduates by graduate and professional students.

Strategy 4: Partnerships

Explore partnerships with outside organizations who are already working to engage graduate students and young professionals.

• Investigate a partnership with Combined Jewish Philanthropies to establish Base Hillel Cambridge.
• Develop a more consistent collaboration with the Cambridge Conservative Minyan.
• Explore potential collaborations with Chabad, Moishe House, et al.
• Collaborate with local organizations to build broader post-graduate Cambridge Jewish social and cultural community.

Goal 3: Community Engagement   

Harvard Hillel engages our community in compelling ways when we create featured programs that leverage the special assets, opportunities and setting of Harvard. Sharing Jewish ideas and culture and Israel with all of Harvard is an essential role; and our setting at the core of the Harvard community, along with our network of thought leaders and accomplished alumni, enable us to create and convene conversations of the highest caliber. Harvard Hillel will build on our current high-profile forums and initiatives to a) engage our University community and increase our appeal on campus by showcasing thought-leadership on relevant issues; b) share this aspect of Harvard Hillel with our widespread alumni and other supporters; and c) increase the renown of Harvard Hillel as a thriving community and center of Jewish excellence. 

Strategy 1: Student Leadership

Amplify students’ voices on issues of the day and increase dialogue among students, faculty, and special guests on critical issues facing the Jewish community and Israel.

• Cultivate and promote an expanded set of major programs conceived by students (e.g. Israel Summit, Israel Trek, student-invited speakers).
• Increase student involvement in the conception, planning, and implementation of further high-profile programs.
• Strengthen Harvard Hillel’s position as the center of Jewish and Israel activity on campus.  

Strategy 2: Partnerships and Programs

Multiply and diversify collaborations with faculty, academic departments, offices, and centers of Harvard to consolidate and promote our distinctive platform for featured conversations on important ideas and issues.

• Continue and highlight our faculty and guest speaker series and continue to share it online.
• Build on the success of the Riesman Forum on Politics and Policy, Brachman Israel Initiative, and Harvard College Israel Trek to convene further high-level events and conversations.  
• Partner with Harvard departments, offices, and centers to develop and launch relevant, proactive, and responsive events on campus.
• Increase student-faculty interaction through these collaborations.

Strategy 3: Wider Audience

Share selected high-profile Harvard Hillel programs with our wider constituency of alumni and supporters in convened programming at Harvard and in online modalities that increase our visibility and reach. 

• Build a core set of programs and opportunities for alumni to foster connection and engagement with Harvard Hillel and one another.
• Promote and share signature Harvard Hillel programs with alumni via in-person and digital platforms; live-stream and web-cast major programs to beyond-campus constituencies and a wider audience.
• Create a featured program each year at reunion time.
• Consider new forums for engaging students, faculty, alumni, and others around topics of Jewish- and Israel-related interest
• Foster an online community among Israel Trek returnees, including current students and alumni (already numbering in the hundreds); consider creating an Israel Trek for alumni and supporters.

In service of Goals 1, 2, and 3, ensure that our physical space supports our new and expanded offerings and explore rebranding Harvard Hillel.

Strategy 1: Facilities

Decide on the extent of renovations to Rosovsky Hall needed to meet our future needs.

• Ensure we can provide ample space for simultaneous graduate and undergraduate events and incorporate graduate students into Shabbat community and Sabbath meals.
• Ensure that we have the financial resources in hand to support any expansion/renovation of our facilities and increase endowment levels to secure Hillel’s continued programming role on the Harvard campus.

Strategy 2: Rebranding

Determine the advantages and liabilities of rebranding Harvard Hillel, whether in the near term or as programming evolves .

• Survey and conduct focus groups with undergraduate students, graduate students, alumni, and other supporters.
• Conduct a study of Hillels who have undergone a rebranding effort.

Implementation of this plan, particularly the goal of building a Jewish graduate student community, will require additional funding and staffing as well as modifications to the facilities at Harvard Hillel. It is important to make provisions to secure these resources to ensure the success of the strategic plan. Therefore, a task force with representatives from the Strategic Planning Committee, Development Committee and Building Committee will meet to coordinate their plans.

Human Resources

In order to successfully implement the strategic plan, we will have to reassess our staffing structure. Parts of this plan, particularly Goal 1, can be executed with minor realignment of the current staffing levels. However, some initiatives, such as those in Goal 2 and possibly Goal 3, will likely necessitate additional staffing and/or repurposing of current staff once the amount and types of new programs are determined for each goal.

Financial Resources

The additional programming and staffing needs, along with the required building renovations, have significant associated costs. Fundraising, which has been integral to Harvard Hillel’s success, will become even more of a priority for both the organization and the board.

This strategic plan and the vision for our building necessitate a robust, multi-year fundraising plan to ensure that we have the resources we need and remain sustainable. Year 1 of the strategic plan, when we have relatively few additional expenses, will be spent creating the fundraising plan which will include a major gifts program, outreach to untapped foundations, and an expanded capital campaign. Implementation of the fundraising plan will begin in year 2 when we need more resources to implement Goals 2 and 3.

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