Business Plan

What a business plan is

A business plan explains, over 20 to 35 pages, what a company does, for whom, why that works and what it costs. It ties the narrative to the numbers.

In a financing it has two audiences with different demands. Banks and public lenders require it as a formality. Equity investors read it to test what the pitch deck claimed.

The usual structure

1. Executive summary: two pages that stand on their own. The one part certain to be read.
2. Problem and offering: what you solve, for whom, and what the customer does today instead.
3. Market: sized bottom-up, with competitors and your position.
4. Business model: how revenue arises, at what cost, at what margin.
5. Go to market: channels, cost per acquired customer, sales capacity.
6. Team: who can do this, and what is still missing.
7. Financials: P&L, cash, balance sheet, three cases.
8. Funding need and use: how much, for what, and what it buys in 18 months.
9. Risks: the three largest, each with a countermeasure.

Where it usually breaks

Not in the narrative, but in the link between text and model. If the text says three sales hires, the model needs three salary lines starting in the month named, with employer costs and a ramp before they produce.

That consistency is exactly what gets checked. A plan whose text and model diverge casts doubt on both.

The number readers look for first

The funding need and what it buys. Not "EUR 2m for growth", but: EUR 900k sales (six people from Q2), EUR 600k product (four engineers), EUR 300k marketing, EUR 200k buffer, taking revenue from EUR 1.8m to EUR 4.5m over 24 months.

Common mistakes

1. Sizing the market top-down. "One per cent of EUR 8bn" is arithmetic, not a plan.
2. Showing only the good case. The first question is always what happens at half the growth.
3. No competitors. "We have none" reads as ignorance of the market, not as a lead.
4. Understating people costs. Employer contributions, equipment and ramp-up sit on top of gross salary.
5. Length. Past 50 pages the chance of it being read in full drops sharply.

Frequent questions

Business plan or pitch deck?

Both, with different jobs. The deck opens the door in 12 to 15 slides. The plan survives the scrutiny that follows. Banks and public lenders almost always require the plan.

How far should the plan run?

Three to five years, the first twelve months monthly. In practice only the first eighteen months are examined closely.

Who should write it?

Management, with support. Anyone who outsources it entirely cannot answer the questions it provokes, and those questions come.

The Roemer Capital view

We build the financial model first and write the text afterwards. A text written before the numbers describes a plan the model will not carry. The other way round, every statement has a line in the model behind it, which is precisely what due diligence looks for.