One of our blog readers, Brenda, asked to learn more about business plans:

So this week our Entrepreneur University comes thanks to Dave Turkin. Dave, of Accessible Business Consultants, is a full service business consultant that has over 32 years of experience working with small-medium size businesses. Dave has designed and implemented numerous business and marketing plans, designed internal programs for accounting and operational procedures. We featured Dave in November when he wrote about How To Do An Annual Business Checkup.

To help Brenda out with Dave discusses today what a business plan should look like:

There are many clichés and misunderstandings surrounding Business and Marketing Plans than any other part of the capital raising process. These range from the belief that plans are not needed (my concept is so good it sells itself) to the “thicker the better” school of Business Plans. I have seen Business Plans that are over 100 pages that includes 25 pages of newspaper clippings and a scholarly treatise on the industry complete with an additional 20 pages of charts and graphs, which by initial sight is very impressive, but never read. The failure of this approach stems from a misunderstanding of the role of a Business Plan in the world of capital venture.

Contrary to popular belief, no capital venture firm or “angel investor” hears a presentation or reads a plan and becomes so excited that he sits down and writes a check immediately. An Angel Investor is no different than a capital venture firm, bank or insurance company in his or her desire to make a prudent and sound investment. I have heard client’s state that Angel Investors or Venture Capitalists are no better than banks or traditional lenders because they want experience management, collateral, growth industries, and ability to repay the loan as well as significant returns on their investment. They thought an Angel Investor suspended all prudent business practices and just threw money into any project presented to them. Nothing could be further from the truth. Each venture capital source must present a detailed Business Plan to a committee or advisors to determine if further processing is warranted. The Business Plan is the door opener, if the plan is favorably received the company will proceed to the next step, due diligence.

What does the Lending Community want to see in a Business Plan? The projects that are selected achieve a business comfort level that encourages further pursuit. If the business is inherently unsound, a skillfully drafted plan can not cure the flaws, nor does a poorly written plan automatically condemn an excellent company’s chance for financing, however the poorly written plan