Business plan
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BPL72020FinalAssessmentfinal.pptxGoing Forward and Reflecting Back:
Exits, Assessment and Support
Claire Sinclair
Business Planning Lecture 7
Go to www.menti.com and use the code 46 05 3 to ask me any questions about the module
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Today’s Lecture
Beyond Start-up:
Growing or exiting your business
What to include in your business plan
Reflection revisited: Individual Assessment
Enterprise Support at York: Science Park & Enterprise - Chris Hiscocks
Student Evaluations
Go to www.menti.com and use the code 46 05 3 to ask me any questions about the module
What next after start-up?
Show Potential Beyond Start-up
What’s the long term plan?
How will you achieve it?
Grow? Diversify? New markets?
New/ additional investment?
Seek a buy-out of part or all of your company?
(When) Will your investors want out?
How will you finance your future activities?
Don’t just spend all your time thinking about starting up / the first year. Consider the first 4 years and beyond.
What will be your (or your investors) exit plan?
Grow or Go?
Some entrepreneurs are very good at ideas and creativity, but less skilled or interested in the operational elements of running an established business. The ‘go’ option is a valid strategy.
It is also valid to consider different options for different circumstances – ‘if this happens I’ll do this…’
Business plans are a working (as opposed to a fixed) document.
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Options
Trade sale
MBO or MBI
Buy-back (by co-investors)
IPO
Angel Investors 5 years; Return = 5-10x investment; Risk = no return
Majority of exits are ‘Trade sale’ – develop the business to be so painful to competitors that they buy you, or someone in your value chain (supplier or customer (if b2b)) buys you.
MBO Mgt Buy out (existing mgt team buy the business) / mgt buy in (external mgt team buys the business).
Buy back – current investors buy out one investors shares
IPO – initial public offering
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Grow?
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Growth Strategy
Franchisor
Advantages
Way of expanding business quickly
Financing costs shared with franchisees
Income from royalties, sale of goods and franchise fees
Franchisees usually highly motivated since their livelihood depends on success
Disadvantages
Loss of some control to franchisees
Success dependent on franchisees
Contractual obligations to franchisee
If member of British Franchise Association – costs of compliance
Franchisee
Advantages
Reduced risk start-up
Tried and tested model
Brand
Support for inexperienced entrepreneurs
Disadvantages
Little control over business
E.g. new signage, training requirements, pricing, layout, suppliers
Compliance
May be more expensive start-up
Success dependent on franchisor
Contractual obligations to franchisor
Difficult to exit
May have to work very long hours to secure profit
Grow through acquisitions
Horizontal acquisition = two firms in the same line of business
Vertical = expanding up or down chain of distribution, towards suppliers or ultimate consumer.
Conglomerate = combination of unrelated businesses
Consolidation = new firm created out of two (or more) previous entities that cease to exist.
The Enterprise Habit
Habitual Entrepreneurs
Portfolio
Serial
Portfolio – more than one business
Serial – one after the other
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Portfolio Entrepreneurs
Visible and invisible
https://www.virgin.com/company
http://www.pentland.com/our-brands.html
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In your business plan
Show the potential for your business beyond the first four-years. Where might it go and how might it get there?
What is the long term vision for the business?
And for you as entrepreneurs?
Clarify your ambitions and vision
Show potential investors how attractive your business is.
Indicative Contents for your Business Plan
Cover – with name and logo
Table of contents – List of sections and sub-sections, with page numbers.
Executive summary – This is vital. Many lenders and investors only read the exec summary.
Business strategy – The opportunity - who you are, what you plan to offer, how, why, and to whom. Your aims and objectives and key milestones.
Industry and Market Analysis including Competition
Customers and value proposition
Marketing and sales
Operations and resources
Management team, personnel and company structure
Legal and Regulatory requirements – incl necessary insurances and qualifications.
Financing and financial forecasts - Summarise key information and forecast when you will become profitable. Detailed forecasts for Year 1 and less detailed for later years.
Risk Assessment – Summarise risks and steps that you will take to mitigate.
Long Term Plan – Growth and exit strategies.
Appendices –– any background or supplementary information, detailed financials, market research information not included in the main plan.
Reference List – Provide a list of sources used. Best practice for business planning and business reports is Chicago style (i.e. footnotes) referencing.
Referencing in a Business Plan
Chicago Style referencing (footnotes)
No reference required for tools that are in common use (e.g. SWOT; Porters Five Forces; PESTEL)
Most important: Sources of evidence to support your forecasts
List your sources in the Business Plan (report) not in the presentation
Business Plan Presentation
10 minutes to present
5 minutes Q&A
Panel: Claire Sinclair, Nicky Forsdike, Tim Chapman
LMB 102b Boardroom
Good presentations:
Lively, clear, professional, structured
Everyone must make a contribution
Individual Assignment
“Critically reflect on your role in the development of your team using relevant academic theories which may include leadership, group dynamics and/or team roles, to explain your experience.”
2000 words
Group members to be anonymised.
Use Harvard style referencing (usual University of York style) e.g. (Howorth et al., 2019)
Some useful links about referencing
https://www.york.ac.uk/integrity/
http://www.york.ac.uk/integrity/harvard.html
Why be a reflective practitioner?
Report published by the ICAEW Centre for Business Performance
When students complete their undergraduate studies they have to make the transition from a relatively stable and structured environment to a professional and managerial world that is both fluid and dynamic.
As professionals they will face the challenge of dealing with complex and ill-defined problems where structured solutions may not be available or suitable. They will need to respond with an active and reflective, rather than a routine or habitual, response. In other words, they need to develop as ‘reflective practitioners’ (Schön, 1987). The capacity to reflect underpins the exercise of professional judgement and ethical awareness and is an essential part of professional life.
Consequently it is no surprise that, within professional and undergraduate education, there is an increasing emphasis on the development of a reflective capacity.
Reflective cycle (Gibb 1988) SEE KOLB LEARNING CYCLE
Description (what happened)
Feelings (what were you thinking and feeling?)
Evaluation (what was good and bad?)
Analysis (what sense can you make of the situation)
Conclusion (what else could you have done?)
Action Plan
(If it arose again, what would you do?)
Remember the theories from the seminars
Tuckman & Jensen – group development
Belbin – team roles
Tannenbaum and Schmidt – leadership
Various theories of entrepreneurship introduced at the bootcamp
Relevant theories you have learned in other modules.
Being Reflective
Discuss development of your idea, including ways in which your pre-existing knowledge and preconceptions shaped it, how they have been challenged, and how they have evolved.
Draw on theories about how teams develop and on theories about how entrepreneurial ideas evolve.
Look back on your experiences (refer to meeting notes, your learning diary)
Create a timeline showing a sequence of key events or stages.
Make notes about your involvement, impact, and feelings at each event/stage.
What was challenging for your team, and for you personally?
How did you or could you change to get a better outcome?
Reflection requires a bit of humility…
“…we needed direction, fortunately a natural born leader emerged….myself. I’d say that my style was a charismatic and visionary leader, a natural born mixture of the best qualities of Branson, Dyson, Steve Jobs, and Bill Gates…with none of their faults.”
“…In Week 4 I was busy with organising social events for my sports club, so I ordered my most trusted side-kick in the group to take charge temporarily until my busy schedule permitted the team to have more of my attention.”
“…this product is aimed at the elite. Fortunately, with my background I was well placed to be project leader. Therefore the key ingredient in our success was myself. Fortunately the others realised this and trusted in my vision and eliteness, allowing me to lead us to the success that we deserved.”
Note: These are not word-for-word real examples…..but they are inspired by some of the previous work we have had to mark!
Advice from former students: Reflective Essay
It’s important to make sure you get the theory in there
It’s a chance to discuss and try to understand problems and benefits of working in groups
It’s hard to be self-aware and critical but you learn a lot about yourself
Ooops! Make sure you read the instructions.
Advice from former students: The Presentation
Decide before Easter how you’re going to keep in touch
Delegate presentation roles before the break
Plan what’s going where first, then practice
Quiz each other to practice possible questions
We couldn’t fit in everything we wanted to say so we used a handout
Good luck!
Please Proof Read
Assessment Summary
Team business plan (5000 words) 30%
11am, Tuesday 21st April 2019
1 electronic copy
Team presentation (15 minutes) 10%
Slides by 11am, Thursday 23rd April 2020
Presentations week comm 27th April 2020
Individual assignment (2000 words) 60%
11am, Wednesday 6th May 2020
1 electronic copy
Support Available
Use our office hours
All tutors will still be answering emails over the Easter holidays via email or if needed, via phone.
Go to www.menti.com and use the code 46 05 3 to ask me any questions about the module
Taught Programmes
Ways to learn about Enterprise. These courses give you the ‘need to know’ and help you hone your skills,
Explore 5 afternoons. Individual or team. Ideation, Market, Pitching. Pizza.
Expand 3 day mixture of workshops, talks and reflection. The next step - cash flow, advertising, legal, tax, IP, Trademarks, identity, values, branding, ‘what next’. Also pizza.
Opportunities
Funding , coaching, workspace, networking
Appointments
Proof of Concept
Summer Accelerator
Year in Enterprise
York Venture One
Startup Visa
york.ac.uk/enterprise [email protected]
What is Phase One?
An entrepreneurial start up space and programme supporting research spinouts, digital, creative, tech and science innovators to turn their ideas into sustainable businesses
Part of a wider University of York investment programme
The Proposition
Phase One Incubator Programme
A smart, 24/7 space and place to set up and run a new business
Flexible desks and pods for working, meeting and collaborating
Full connectivity and wi-fi
Formal meeting room and break out areas
Communal facilities
Access to all Science Park facilities
Support programme of advice, workshops and mentoring
Access to partner organisations and expertise to accelerate growth potential
A collaborative environment to network and unlock opportunities
Free for 12 months
Student Evaluations
Good Luck!
It has been a pleasure to teach you
