Business Plan Preparation & Presentation

1. Who is an entrepreneur?
He/she is a person who identifies a problem
Generates ideas to solve this problem in exchange of gains
2. What is a business plan?
A document that summarizes all aspects of the business
The document explains the history, operations and future of the company in a nutshell
3. Does not have to be lengthy. A 100 page report does not mean it is better than a 50 pager!
4. Most of the time it is used to raise money i.e. debt or equity
5. What are the important aspects to look out for in a business plan?
Product/Service
Technical feasibility
Marketing feasibility
Value Proposition & USP
Vision & Mission
Team & Key Management Personnel
Competition & Competitive Strategy
Pricing Strategy
Time lines
6. Financial projections to form part of business plan. Should include,
Balance Sheet, Income Statement & Cash flow
Should have monthly projections for about 3-5 years
7. Financial projections give a fair understanding on aspects such as,
Fund requirement
Time when such funds are required
Deployment of the funds
Break-even point
Return on investment
Important aspects of costs and revenue

Valuation
1. Fair value is the price, in cash or cash equivalent, that a buyer could reasonably be expected to
pay, and a seller be reasonably expected to accept, if the business were exposed for sale in the
open market for a reasonable period of time with both buyer and seller being in possession of
pertinent facts and neither in compulsion to act.
2. Valuation of an enterprise is carried out on a going concern basis presuming that the company
will continue its business operation in the foreseeable future.
3. Valuation is based on the future projections of the company (normally 5 years).
4. It involves determining the fair value of a share of the company.
5. Pre-money valuation is before the investor funds the company and post-money is after the funds
are infused into the company.
6. There are several method of valuation and the same has to be applied on a case to case basis.

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7. Valuation involves a fair degree of judgement over and above the accepted method of valuation.
Essentially happens in case of private and unlisted companies.
8. Companies that have direct/indirect competitors that are listed companies, have a lower degree
of assumptions and judgements used in their calculations.
9. Valuation of an enterprise is essential before negotiating with investors. It helps to understand
what at value to start the negotiation process from.
10. Ultimately in the market place, the investor is always looking at a lower valuation (to get more
shares) and the company at a higher one (to give out less shares)!

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