A one-page business plan is a simple tool to clear your mind. It focuses on three questions: What core problem am I solving? Who are my potential key customers? Where do I find them? It helps define the problem, profile the key customer, and find the key distribution channel.
Why use a one-page business plan?
One of the issues of traditional business planning is about its complexity, which makes it hard to recognize its value. Indeed, a business plan should be a way to allow you to take action.
The main issue with traditional business planning though is that rather than make it easier to take actions, it makes it harder. Indeed, often too much planning can induce the so-called analysis paralysis.
A scenario in which draws a massive plan becomes an excuse not to act. Instead, a one-page business plan is just the opposite.
That is an exercise which aim is to draw in a page all the necessary elements your business model needs to get going — nothing more, nothing less.
It is vital to understand when it makes sense to use a traditional business plan instead.
Is the one-page business plan better than a conventional business plan?
It is important to remark that there isn’t the best way to draw a business plan. Between a traditional and one-page business plan, we can’t say that one is better than the other in all the situations.
They have different aims. The traditional business plan is extremely well suited for someone that is starting up a business that needs financing. The one-page business plan instead is tailored for someone that needs the necessary input to get the business started.
Therefore, if you will need other investors to chip into your business, a one-page business plan won’t do. Especially if you go through a more traditional way to get the financing, you will need a structured business plan.
On the other hand, if you need to understand whether your idea is actionable, you’re good with a one-page business plan!
Thus, we need to draw a line between venture capital vs. bootstrapped.
Venture capital vs. bootstrapped
In the business world, there are different schools of thought about what’s the best way to launch, run and grow a startup. It all depends on how you see the business world but also how the market is looking like in a particular historic context.
For instance, in a situation where venture capital firms have massive resources and the economy, in general, is in good health, it might be easier for startups to raise capital.
In that context, as an entrepreneur, it might make sense to ask for financing for your ventures. Therefore, a traditional business plan will help you go through that process.
Take the opposite scenario, where funding is scarce, and resources are not easy to find on the market. In that scenario, the so-called bootstrapped mode, or you grow your business it might make more sense. Thus, a one-page business model will do!
Once again, there isn’t the best way to do something. But instead, the way that suits you best, based on the context and how you believe business should work.
For instance, if you don’t want the interference of other people telling you how to run, and grow your business, venture capital is not for you and a one-page business plan is the best tool you can use for clarity of mind.
In the scenario, where you instead want to have a group of people supporting the growth of your business, and you’re also ready to take those interferences then a tradition business plan is the tool for you.
None will back you up without a proper business plan with a three to five years projections.
Many assumptions vs. a few assumptions
Another critical distinction between traditional business planning vs. the one-page business planning is the role of assumptions.
When you draw a traditional business plan, there are many assumptions on which the business plan is based on. However, one of the premises of the lean startup is just the opposite.
You need to get outside and test those assumptions quickly. Indeed, with the one-page business plan, you do just the opposite. Get to act as promptly as possible to check the assumptions you have about your business.
Key elements of the one-page business plan
What parts should you take into account for the one-page business plan?
There are a few questions you’ll need to address to understand the viability of your plan:
- Did I identify a problem that other people are experiencing?
- Is this problem experienced by enough people to justify a business?
- What solution can I bring to those people?
- Would people be willing to pay to get that problem solved?
- Would I make enough margin to have a viable business?
- Why would those people pick my solution?
- Do I need a team to deliver this solution?
- Do I need money or can I bootstrap it?
Start with the end in mind until you get to the action plan
One of the primary pitfalls of a business plan is usually too much planning and fancy numbers and no vision at all. Indeed, one of the key ingredients to be able to achieve massive results is a bold vision.
The vision is about what you want your business to become when it grows up; how it will need to be.
Within your mission, you’ll need to set a few key objectives you want to achieve. You don’t need a list of dozens of items. A list of the first few objectives and steps would do.
What do you need to achieve those objectives? How much financial resources? Do you need a team? Do you need tools? List them up to understand what resources they require.
One-page business plan in action
Once you understand the context you can map on a single page the kind of business you want to build. You don’t need complex tools or business plans (unless you’re going to ask for investments, in that case, you need a solid business plan and a pitch deck).
Instead, a piece of paper with some key elements of how you want your business to look like will do.
You can map three key elements initially:
- What core problem am I solving? (problem definition)
- Who are my potential key customers? (customer profiling)
- Where can I find them? (distribution)
Your turn now!
Key Highlights of the One-Page Business Plan:
- Simplicity: A one-page business plan is a concise tool designed to provide clarity by focusing on key elements of your business model.
- Three Essential Questions: The plan centers around three crucial questions:
- What core problem does your business solve?
- Who are your potential key customers?
- Where can you find them?
- Actionable Planning: Unlike traditional complex business plans, a one-page plan is meant to inspire action rather than induce analysis paralysis.
- Analysis Paralysis: Traditional planning can lead to overthinking and inaction, known as analysis paralysis. A one-page plan encourages immediate action.
- Targeted Use Cases: The one-page plan is suitable for situations where you need clarity to get your business started quickly, but it’s not ideal for securing investor financing.
- Context Matters: Choose between a traditional business plan and a one-page plan based on factors such as your financing needs, growth strategy, and market conditions.
- Venture Capital vs. Bootstrapped: The choice between seeking venture capital and bootstrapping impacts the planning approach. Each has its merits based on market dynamics.
- Assumption Testing: The lean startup approach emphasizes testing assumptions quickly, aligning with the one-page plan’s focus on rapid action and learning.
- Few Assumptions: Unlike traditional plans with numerous assumptions, the one-page plan encourages prompt validation of key assumptions in the real world.
- Key Elements: The one-page plan addresses essential aspects to evaluate viability:
- Identifying a common problem.
- Determining if there’s a substantial market for the solution.
- Describing the solution’s value.
- Assessing willingness to pay for the solution.
- Ensuring viable profit margins.
- Explaining why customers would choose your solution.
- Considering team and resources needed.
- Evaluating whether funding is necessary.
- Start with Vision: Develop a bold vision for your business’s future, encompassing growth and achievements.
- Mission Statement and Objectives: Create a mission statement that translates the vision into action, supported by a concise list of key objectives.
- Resource Requirements: Identify the resources required to achieve your objectives, including financial, team, and tool needs.
- Action Plan: Detail the short-term actions needed to accomplish the objectives set in your mission statement.
- Application in Action: The one-page plan comes to life by mapping out:
- Core problem you’re addressing.
- Potential key customer profiles.
- Distribution channels to reach customers.
- Simplicity and Clarity: The one-page business plan offers a straightforward approach to capture essential business aspects and guide your initial steps.
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