Planning is Half the Battle

In 1985, a young, impressionable me was glued to the television at an ungodly 7:00 a.m., absorbing my daily dose of G.I. Joe – a ritual as sacred as it was commercially driven. With every hard-earned penny of my allowance spent on amassing a plastic army of action figures, I eagerly devoured each episode, reveling in the gratuitous violence and the inevitable triumph of good over evil. But the real treasure lay at the end of each 22-minute adrenaline rush: a nugget of wisdom dispensed like a toy surprise in a cereal box (the kind of sugar-laden breakfast treat that my health-conscious parents strictly forbade).

“Knowing is Half the Battle!” the show proclaimed, a mantra that etched itself into my malleable young mind. These life lessons, tacked on like an afterthought to the credits, were the closest thing to moral guidance I received outside of my parents’ endless lectures. Little did I know that amidst the admonitions against swimming during electrical storms and reminders to stop, drop, and roll in case of fire, one piece of advice would prove invaluable in my entrepreneurial journey: “anything worth doing is worth planning.” Who would have thought that a glorified toy commercial masquerading as a children’s show could impart such lasting wisdom?

Entrepreneurship is More Than Just a Battle

Building a new idea and business is electrifying—a mix of adrenaline and too much coffee—until you get sucker-punched by the statistics. And almost 40 years after taking that initial lesson to heart, I’m here to deliver that sucker punch.

According to the folks over at the Ewing Marion Kauffman Foundation, with their Kauffman Indicators of Entrepreneurship, the business world is more of a Royal Rumble: 1-in-5 businesses are tossed out of the ring in their first year. Fast forward to year five, and more than half have been body-slammed into oblivion.

Timing and Efficiency in Planning

However, it’s not just about recognizing the need to plan but understanding when and how to approach this critical task. Research from Francis J. Greene and Christian Hopp, shared in their Harvard Business Review article “When Should Entrepreneurs Write Their Own Plans?”, sheds light on this nuanced aspect of planning. They found that the most successful entrepreneurs were those who wrote their business plan between six and 12 months after deciding to start a business, increasing the probability of venture viability success by 8%, emphasizing that timing is crucial.

Furthermore, Greene and Hopp discovered that the optimal time spent on drafting a plan was around three months. This duration increased the chances of creating a viable venture by 12%, highlighting that spending any longer could render the information used in the plan outdated, while spending too little time was equally ineffective. This insight underscores the importance of not just planning, but planning efficiently within a timeframe that aligns with the dynamic nature of startup environments.

So, for those following along, entrepreneurs who dedicate between nine and twelve months in pre-planning and business plan writing have a whopping 20% better chance at creating a viable business. Those are odds I’d want in my favor.

Navigating the Entrepreneurial Minefield

But let’s dig a little deeper. Three boogeymen are responsible for most business nightmares. First up, cash flow problems are the silent assassin behind 82% of small business deaths, according to the U.S. Chamber of Commerce. It’s the horror story of not having enough cash to keep the lights on. Then, there’s the tragedy of launching a business nobody asked for—over 40% of ventures dive into an empty pool because, well, no one wanted what they were selling. Lastly, poor management—just because you can bake a mean cake doesn’t mean you can run a bakery.

It’s not the failures that bother me and keep me up; it’s what they do to my people—entrepreneurs.

Let’s take a deeper look at what failed entrepreneurs have shared with me. The personal toll is like a bad hangover—except no amount of greasy food can fix it. Entrepreneurs end up wrestling with doubt, loss of mojo, and the kind of stress that makes you forget your own birthday. Relationships can crumble faster than a cookie in a toddler’s grip, leading to the greatest hits of life’s low points: breakups, estrangement, and the dreaded realization that maybe, just maybe, this wasn’t such a great idea.

On the job front, failing at business can stick to you like a bad nickname in middle school. Your professional rep takes a nosedive, networking opportunities dry up like the Mojave, and trying to jump back into the employee game feels like auditioning for a part you’ve played and were no good at.

And then there’s the financial wreckage. Debt piles up, credit scores plummet like Enron stock, and the specter of legal woes looms large. It’s the epic quest of trying to claw back from the financial abyss, with the added fun of explaining to future financiers why you’d be a good bet the next time around.

This isn’t meant to scare you (okay, maybe just a little).

The True Essence of Planning

What I’m really trying to highlight is a truism I learned all those years ago: “Anything worth doing is worth planning.” I’ve spent my entire adult life helping entrepreneurs and businesses plan. The ones who rush it, who aren’t really prepared but ignore it, focusing on just getting the document (business plan) done without a real foundation of knowledge or vetting of ideas behind it, ultimately fail and suffer the personal, professional, and financial wreck that follows.

I guess what I’m trying to say is that there’s a big difference between writing a business plan and business planning.

In the trenches of business planning, this means being ready for anything. It’s about foreseeing the ambush of unexpected costs, the sniper shot of a sudden market shift, or the minefield of regulatory hurdles. Like a well-executed military strategy, success in business requires understanding the terrain, knowing your capabilities, and having a plan before you invest your life’s savings or quit your day job.

Pre-Planning: Your First Strategic Move

The best move? Engage in some serious Pre-Planning, kind of like the recon missions of business. Before you even think about launching, take a detour through Businessplan.com’s Pre-Planning Process. It’s your plan before the plan, helping you vet your concept thoroughly. This isn’t about dousing your entrepreneurial fire; it’s about making sure you’re not jumping without a parachute. Tweak your idea, pivot if necessary, or even scrap it if the intel suggests a no-go. The stakes are low at this stage, making it the perfect time for bold moves and honest assessments.

Embracing the Entrepreneurial Spirit

Entrepreneurship is not for the faint-hearted. It’s for the brave souls ready to stare down their fears and charge forward. This means embracing the possibility of failure but not being defined by it. Equip yourself with knowledge, learn from your missteps, and remember that every great comeback starts with a setback.

A good dose of fear is just the prelude to bravery.

And remember, there’s an arsenal of tools at your disposal, from market research databases to financial planning software. Leverage them. Understand your market, your product costs, and your business model, get your numbers right, and hire the right team. Remember, the most successful commanders are those who gather the best intelligence and adapt swiftly.

Your Venture Awaits

Planning is half the battle in your venture. Before you write your business plan, dive into the Pre-Planning Process with gusto, face your entrepreneurial journey with courage, and share your story. Your experiences could light the way for fellow adventurers, contributing to a community of knowledge and resilience.

We encourage you to engage with us on X or LinkedIn, share your tales, and join the conversation. Your journey could inspire countless others.

Now, go forth and conquer!