A look at alternative business plans
Our Virgin StartUp business plan template is designed especially for those applying for Virgin StartUp Loans. It walks you through providing all the information we need to assess you for a loan, so nothing is missed out – and so we require that every business applying for a loan from us fills it out. It'’s also great for anyone else who needs to create a business plan, especially if you’re not sure where to start, as it takes you through every part of what we require and ensures that every base is covered, making your journey that much smoother (and getting you to think hard about your business.)
However, every business is different, and the startup world is rapidly evolving. There are now many different approaches and tools out there for creating business plans, whether the traditional route doesn’t appeal to you, your business is changing rapidly or is at an early stage, or if you’re a tech business with specific needs. Here are a few alternative approaches to planning out your business, many of which emphasise speed, flexibility, and the ability to pivot.
What a business plan is for
A business plan provides you with a firm outline of what your business aims to do, and the steps necessary to fulfil this. It’s vital if you’re planning to pitch to investors, banks, loan providers, co-working spaces, suppliers and more – it basically shows that you do have a clear plan for your business, and have thought through the logistics necessary to make it a success. Aside from being an unskippable step if you’re trying to get someone else on board with your business, it’s also a way to keep yourself on track, reconnect with your core values and mission, and ensure that you’ve thought through the nasty but essential aspects such as finances and contingency plans.
Business Model Canvas
The Business Model Canvas is a model created by Alexander Osterwalder that’s popular in the Lean StartUp community. It gets you to distil your business into nine building blocks: key partners, key activities, key resources, value propositions, customer relationships, channels, customer segments, cost structure, and revenue streams. Once you’ve defined and elaborated on all of these, they act as the base for your business. Setting it out in this way allows you to pare your business model to the parts that the Lean StartUp community feel are the most vital, simplifying it and allowing you to see at a glance how things fit together. You can download it here.
Why it’s useful: It’s a way of looking at business plans that cuts through any waffle and provides a clear structure if you’re not sure where to start. It’s also easy to adapt as your business grows or your idea changes.
Who it’s good for: Tech startups, businesses that are still finding themselves somewhat.
The Lean Canvas model is based on the above Business Model Canvas, but simplifies it further. Again it has nine elements, which this time are comprised of: problem, solution, key metrics, cost structure, unique value proposition, unfair advantage, channels, customer segments and revenue streams. In this way you create a diagram of your business on one page.
So what’s the difference between the Lean Canvas and the Business Model Canvas? Creator Ash Maurya envisioned this model as a blueprint for a business, an actionable plan that made it easy to change and adapt. Rather than include absolutely everything a traditional business plan would contain, it focusses on high-risk elements, and makes thinking about problems a priority.
Why it’s useful: It creates a business plan quickly, and allows you to see all the key elements on one page, making it an easy referral point.
Who it’s good for: Very early-stage startups still working things out, startups that aren’t quite at the investment level, startups likely to change rapidly.
LeanLaunchLab is what happens when the above approaches go a step further. It’s software that enables an individual or team to create an interactive business plan – so you can update it collaboratively and track your progress. If you’re working with investors or advisors, they can access it too in order to see what’s evolving and to share advice, you can keep track of any experiments or testing you run, and it enables you to directly feed in stuff like market research as it happens. Basically, rather than constantly revising a static business plan, you’re building one as it happens.
Why it’s useful: It can be constantly revised and updated without hassle, and lets people work collaboratively without throwing lots of drafts and versions around.
Who it’s good for: Startups working remotely or with larger teams, those working with business advisors, tech businesses, businesses that are changing rapidly.
Visual Business Plan
A fancy name for what is, essentially, creating a business plan on Pinterest. It might not seem the obvious platform for creating a business plan, but presenting information visually is an excellent way to organise it and get the message across. You can use images to illustrate target audience, packaging inspiration, colour-schemes, infographics, research. Here’s one that Entrepreneur writer Tim Berry did as an example. It’s not as formal as other options, but if your business has a strong visual bent it can make it come alive.
Why it’s useful: It’s good for informal pitching – where people might previously have used Powerpoint to demonstrate a business plan, Pinterest is an updated version of this. Demonstrating it visually is good for presentations, and it’s a useful way of collating market research, either your own or from others.
Who it’s good for: Visual businesses, early-stage businesses, businesses working out their target market and value proposition.
Plan Cruncher is a pretty nifty tool that helps you create a one-page business plan, or compresses an existing business plan for you, turning it into a one-page summary covering aspects such as the idea (obviously), the team, and the revenue stream. It’s pretty basic, but gets the key points there on the page, making it a useful starting point if you’re struggling to know where to begin, or if you’re having trouble creating an executive summary.
Why it’s useful: It can help reconnect you with what’s really important – the core of your business – and is a good starting point for working you through logistics.
Who it’s good for: Early-stage businesses, businesses with complicated value propositions looking to simplify things a bit.