Five reasons your business plan is becoming obsolete
I recently did a post back in April for VentureBeat titled 5 Reasons Your Business Plan is Becoming Obsolete. In that post, I point out how easy it is get a new business idea or startup tested and vetted without much upfront investment. Many of these themes have honestly been discussed before in other books and posts. I must say that writing about the “minimally viable business plan” got me looking at various products and tools to get your online business up-and-running. There truly is no more excuses to not build a business online anymore – the tools are so easy and you simply have to have the will and passion to put the time and effort into your endeavor.
As every good Ivy League MBA-turned business executive will tell you, the secret to successful startups, rapid early-stage growth, and profitable empire begins with a solid business plan. But lately, scrappy and innovative entrepreneurs are bucking the trend and adopting new forms of growth hacking, and we’re starting to see them change the way businesses are born, grow, and thrive. And compared with their predecessors, they’re knocking expectations and ROI out of the park.
Old-school innovators should take note, or run for their lives (or the lives of their businesses anyway). This new breed of anti-business plan entrepreneur has discovered the new toolset that gets them from proof-of-concept to customers and funding in ways never before seen in the business and investment communities. These mavericks are beating out their competition, one click at a time. Their success can be summed up by the age-old adage “actions speak louder than words,” and in today’s world that has never rung more true for businesses. Here’s why:
MVB is the New MVP
While the concept of minimum viable product is standard business practice across most industries, today’s fastest moving new ventures are now launching minimum viable business models. Although this approach at first blush may seem haphazard and half-baked, in a market that changes by the second (and by the click), MVB companies are free to evolve as consumer demand and conversion data dictates.
If they come, you will build it
Gone are the days where you need product in hand to snag the sale. Turning conventional methodology on its head, today’s anti-business plan innovators are selling benefits now and building features later. And with today’s pre-sell process quickly becoming the norm, customers have skin in the game and can help mold your product into a successful solution that fits their needs.
Instant access to A-players
Specialized, skilled workers used to be hard to come by. Not anymore. With outsourced staffing sites like oDesk, Elance, and Fiverr, businesses have access to a specialized, global workforce at their fingertips that’s no longer limited by the constraints of a zip code. New ventures no longer need to worry about building in salaries and benefits for full-time employees to get their startups off the ground. That’s because now, the most agile teams are hiring inexpensive, flexible, heavy-hitting experts that will work long-term, short-term, full-time, part-time, and everything in-between, in any role under the sun.
Changing the game in real time
Today products evolve at the speed of the Internet, and software is a great example. Once upon a time you’d go to the store and buy a disk, you’d install it on your computer, and that was that. But now not only do you purchase software digitally, software updates are instant as well. This process allows companies to constantly iterate and iron out bugs, and it enables consumers to make updates in real time. People no longer expect perfection on the first go-round. We’ve become comfortable with beta cycles, with versioning, and we expect constant evolution. One thing business owners can be sure of is that mistakes will be made, customer sentiments will change over time, and if you’re married to a static business plan, you’re going to strike out.
Gone are the days when you can waltz into a room and flaunt a perfect pedigree and a promising idea to snag a first round of funding. Investment opportunities that look good on paper have given way to analytics-based backing from data indicative of market and consumer demand that’s a more accurate assessment of future business success than a carefully designed business plan. Goodbye pedigree, hello proof. And if traditional VCs aren’t your speed, no problem. With crowdfunding campaigns and unprecedented access to long-tail investors through sites like Indiegogo, Kickstarter, and AngelList, armed with a compelling dream and the right data, funding is yours for the taking.
So if you’re still clinging to your printed and leather-bound business plan three years in the making, it might be time to kick it to the curb. And if you think you’ll need it eventually, check out the advice from LinkedIn: Even the most successful entrepreneurs-turned-VCs say that it’s more about the pitch than the business plan.
It might be time to come to terms with the fact that success is equal parts getting started, testing, data, and evolving as quickly as you can. And if you’re not willing to accept today’s business realities, I guarantee someone else will.