Business Plans and Presentations

Entrepreneurship for mathematicians

Summary of today’s lecture

Part 1

• The business plan
• What is it?
• Why do you need it?
• What do you put in it?

Part 2

• Presenting
• Writing presentations
• Presenting presentations
• Golden rules of presentations

Business Plans

What’s in a business plan

• A business plan can be 1000+ pages or 5 pages
• Think of it as an organic document. Start small.
• It’s mostly tool to help you understand what you’re going to do
  • Detailed financial projections for at least couple of years
  • Market and customer analysis
  • Risks, threats
  • Financing needs
  • Pricing, go to market, marketing strategy.
• Download a template from about a million places on the internet
• So let’s go through the main parts

The Executive Summary

• This is the bit that everybody reads
• Summarise as if the reader knows nothing about your business
• …because most readers won’t know anything about it
  • Who you are
  • What you do
  • What stage you are at
  • The market you are in
  • Your customers
  • Your “strapline”
  • Your goal or “mission”
  • High level financial summary
• If it doesn’t fit on a page, you’ve failed

Who you are

• The company name (surprising how often that’s left out)
• Physical location
• Online locations
• Contact details
• Company numbers etc
• The team
  • Relevant history
  • Specific rôles and why people fit them
  • Advisors (if you think they help)
• Hiring plans in the future if relevant

What you do

• What is this business all about?
• Describe the product or service (or the proposed product or service)
• Features
  • The things this product does. Its characteristics
• Advantages
  • Why the features help your customer
• Benefits
  • The gain that the customer gets from using your product
  • This is the single most important thing
• Bring in relevance of the team’s experience in this product space
• This is not the place to do pricing strategy or go to market

The market for your product

• Is this a B2B, B2C, B2G business?
• TAM: Total Addressable Market
  • The total market for your product
• SAM: Servicable Addressable Market
  • The portion of the market you can acquire with your business model
• SOM: Servicable Obtainable Market
  • The percentage of the market you can realistically acquire
• These numbers are often wild, crazy and totally unrealistic
• And a common place to see a terrible chart crime – see later

Customers

• Describe typical customers
• Why are they going to buy your product or service
• What is the need that the customers have that you are fulfilling?
  • No need then no sale
• Once you’ve started selling your product you can include examples here
• If you haven’t started selling but you’ve got people lined up to buy, this is where you mention them
• Market research
  • Saying that you think customers will buy is pretty weak
  • Talk to prospective customers if you are a B2B business
  • Maybe pay for some surveys if you are a B2C business

Pricing Strategy

• How much does your product cost to “make”
• How much will you charge for it?
• Volume discounts
• One off vs recurring revenue
  • Investors love recurring revenue
  • Customers…not so much
• Competitive pricing?
• How many things are you selling now and will you sell in the future
• This data will feed into your financial modelling
  • Actually better for your business plan to be fed by your financial model

Aside: Document Management

• biz_plan_final_final_emk_edit_3.docx
• DO NOT DO THIS
  • Do not email documents or presentations to colleagues
  • Use Google Docs, Microsoft sharepoint etc to work on one document
  • Archive and save using Git or equivalent
  • You want to be able to reproduce precisely what you sent to Alice Bloggs of Big Company Inc on the 29th of February 2024
  • Save source (powerpoint, excel, charts) and the PDF
• Parameterise your documents
• Single Source Of Truth™️

Parameterisation 1

Parameterisation 2

from IPython.display import Markdown
from tabulate import tabulate
import pandas as pd

sheet_id = "1JcipzU0OWbHzzAqlHORnNgs322ax-J4ceqzbnS_z6aY"
df = pd.read_csv(f"https://docs.google.com/spreadsheets/d/{sheet_id}/export?format=csv")
business_data = df.to_dict()
CEOCost = business_data["CEOCost"][0]
DeveloperHires = business_data["DeveloperHires"][0]
DeveloperCost = business_data["DeveloperCost"][0]

...

Markdown(f'''
-   We will hire {DeveloperHires} developers at 
    a total cost of £{DeveloperHires * DeveloperCost:,} and our CEO will be paid £{CEOCost:,}''')

...

• We will hire 3 developers at a total cost of £90,000 and our CEO will be paid £60,000
• I know that nobody will do this right now but you’ll wish you had in 2 years

Financial Modelling

• In many ways financial modelling is pretty easy until it gets really very difficult indeed
• I hate spreadsheets with a passion…but this is the one thing that spreadsheets were actually designed to do
• Build a simple “model” of your business
  • Financial periods along the top (normally months)
  • Y axis is Revenue categories and cost categories
  • Parameterise your spreadsheet and don’t hard code assumptions into the formulae
• Eventually, get an expert to do it for you
• A good in-house or outsourced CFO is critical
• This is also where you lay out your funding strategy and how you’re going to get to profitability

Financial Modelling Example

Competitors

• Who are your competitors?
• Strengths, Weaknesses, Opportunities, Threats (SWOT), Price, USP
• Take them seriously
• Avoid this

Feature	Competitor 1	Competitor 2	Competitor 3	Us
Important feature	✅	✅	✅	✅
Pointless feature 1	❌	❌	❌	✅
Pointless feature 2	❌	❌	❌	✅
Pointless feature 3	❌	❌	❌	✅
Pointless feature 4	❌	❌	❌	✅
Pointless feature 5	❌	❌	❌	✅
Another important feature	✅	✅	✅	✅

Table 1: Bad Competitor Analysis

Go to market strategy

• How are you going to sell your product
• What channels are you going to use
  • Word of mouth
  • Industry contacts or conferences
  • Social Media
  • Billboards or TV
  • Earned vs unearned media
• Do you have any experience marketing?
• If you don’t then hire somebody who does
• It doesn’t matter how good your product is, if nobody knows that they can buy it, you’re finished
• Lots of great ideas fail at this hurdle

Risks

• What can go wrong?
  • Competitor ups their game
  • Employees leave (good and bad leavers)
  • R&D takes longer than expected
  • Costs go up
  • Prices go down
  • Cyber attack
  • Regulation changes
  • Asteroid strikes your office
• Try to come up with a plan B (or as they say “a pivot”) before you need it

Operations

• Manufacturing
• Accounting
• Book keeping
• Regulatory compliance
• Human Resources and Payroll
• Tech infrastructure
• Business continuity planning
• Suppliers
• Consultants

But nobody reads it!

• Almost nobody reads it
• In the very late stages of discussing financing with investors, they’ll want everything mentioned previously and more
• But by then your business plan will be out of date. So you’ll scramble to update it and make mistakes
  • Start simple (a few pages, a simple financial model) and add detail incrementally
  • Keep it up to date
• Parameterise your business plan, parameterise your financial models. Single source of truth
• However, you don’t get to the late stages without the early stages which critically depends on….
• THE DECK
• It’s the greatest hits compilation of your business plan

Presenting

Two tasks

• Write the presentation
  • It should really be a very concise summary of your business plan if it is for investors
  • What do you want to say?
  • Decide on brand, colours, fonts, layouts
  • Think about audience
  • Make the presentation a story with a beginning, middle and end
  • Every slide should have a “point”: what the audience supposed to take away from this slide
• Present the presentation
  • Tech
  • Style

Rule 1: It’s not about the presentation

• Powerpoint, Slides, reveal.js, Quarto etc have transformed presentations
• However, the information comes from the presenter not the presentation
• You should be able to give a great presentation without any slides or supporting materials
• If you can’t talk about your business without materials for 30 minutes in a structured and compelling way then maybe rethink your career choice
• But you can use a presentation to enhance or illustrate the points you want to make
• The downside of Powerpoint and Slides is that you can do anything with them which often destroys any coherence and becomes distracting

Rule 2: Talk to the audience

• I don’t mean “don’t talk at your shoes” but engaging with the audience is important
• Work out who the audience is and what they’re interested in
  • Don’t give a customer focused presentation to investors
  • Don’t give an investor focused presentation to customers.
• Don’t talk too much about your product to investors: they’re unlikely to be users of it
• Customers don’t really care (much) about your venture funding requirements and your cash flow projections
• If you get this wrong, everybody is confused or (worse) bored
• Don’t try to have one multi-purpose deck

Rule 3: Attention spans are microscopically short

• This isn’t because people are bad or stupid, it’s because the people you’re pitching to see a lot of pitches
  • VCs and customers might see 8 or 10 pitches a day
• You’ve got to assume that the people in front of you are a bit bored, tired, grumpy and have already seen some pretty good presentations
• Golden Rule! “Answer First”
• Most people don’t read the whole deck
• Make the first slide count
• Some people actually do read the whole deck
  • Consistency of numbers, axes on charts.

Rule 4: Bite sized pyramid chunks (toblerone!)

• The “pyramid principle”
• Break your presentation into shorter chunks with a beginning, a middle and an end. Maybe 2 to 3 minutes long.
• This gives you natural “beats” in the presentation
• People get lost in long presentations (“what’s the point of this again?”). Help them out.
• What is this particular slide about?
• Last slide is critical
  • It’s the one that’s going to be up on the projector while you’re doing Q&A
  • It’s the “call to action”
  • Make it count.

Rule 5: The Three Tells

• In each bite sized chunk:
  • Tell them what you’re going to tell them (answer first)
  • Tell them it
  • Tell them what you’ve told them
• Or in other words
  • Introduce the topic
  • Talk about the topic
  • Summarise the topic
• Keep re-summarising previous topics
• This is not a academic paper or an academic presentation

Rule 6: One Slide, One Minute.

• At absolute maximum you can do one slide in one minute
• This assumes people don’t interupt you with questions in the middle
• If you’ve got a 15 minute slot to present and 50 slides, you’re toast
• Realistically people will want some time for Q&A so a 20 minute slot is probably only 10 or 15 slides
• If you need supporting and supplimentary data or charts, put them in an appendix
• Critical: Each slide needs to say something.
  
• What is the one message do I want the audience to take from this one slide?

Rule 7: Practice

• Don’t practice on your own
• Get some rude, sceptical and critical friends, colleagues or mentors to listen and comment
• Ask them to listen to the whole presentation then comment
• However long the presentation takes when you practice it, it will be 50% longer when you actually do it
• Don’t get too wooden by practicing too much
• If you had practiced saying something and you forget in the heat of the moment, don’t get flustered
• Imagine you’re describing what is on the slide rather than reading it
• Don’t be like a contestant on the Apprentice!

Rule 8: Don’t read out the slides

• Please, don’t read out the slides
• It is unlikely you will be pitching to somebody who is illiterate or blind
• When you’re practicing remember you are talking with the slides, not from the slides
• You’re using the slide summarise what you want to say
• It’s the essence of the message, not the total message
• If you use speaker notes, then remember they’re notes not a script
• Don’t read the notes out either

Rule 9: Fonts, colours, design, charts

• One or two fonts in one or two sizes used consistently throughout
• One or two slide layouts
• Number your pages
• Don’t use a dark background
• Use images with care
• Check aspect ratios (16:9, A4 etc)
• Charts labeled, clear, legible, relevant
• Never use cheesy clip art or inspirational photos or meaningless icons
• Avoid clichéd or meaningless diagrams

Chart Crime 1

Chart Crime 2

Chart Crime 3

Chart Crime 4

Rule 10: Technology

• Be very very careful with your own laptop
  • Open tabs on your browser
  • Bookmarks bar
  • Notifications
  • Other programs
  • 25,389 unread emails
• Check your laptop is compatible with the tech if you’re not in your own environment
• Demos and videos are great but dangerous
• If you’re emailing a presentation, send a PDF not a PPT and name it sensibly
• Compress files you send. This presentation compressed from 5mb to 500k using Adobe’s free tool

Example of a bad presentation

Removed from public distribution

Next Lecture

• Part 1:
  • Equity vs Debt vs Grants
  • Who do you raise money from?
  • Pitching for investment
  • How to handle equity and dilution
• Part 2:
  • A lot of this entire course is going to be about “selling”
  • Selling (or marketing) is the heart of everything as an entrepreneur
  • Customers
  • How to understand and manage the interactions with customers
  • Closing deals
  • Discounts, special deals, cornerstone customers

Questions