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Rich Dad's Advisors The ABC's of Writing Winning Business Plans
By Garrett Sutton Warner Books
Copyright © 2005 Garrett Sutton, Esq.
All right reserved. ISBN: 0-446-69415-0
Chapter One
PLAN TO WIN Congratulations on making the decision to turn your dream into a business plan. It's an exciting step and you are to be commended. Most people's fear of failure and inability to take risks are stronger than their desire to live their dreams. That's fine for them, but it limits their lives.
Now that you have made the choice to go from an idea to a plan, the goal of this book is to both provide a framework for winning business plans and more importantly, to challenge your thinking. There is a standard format that virtually all business plans adhere to. Rather than simply providing yet another rehash of the standard format, we will combine the basic "how-to's" with tough questions and street-smart insights into what savvy investors and lenders are really looking for in each section of your plan.
Successful entrepreneurs naturally embrace the challenge of making their dream a reality. Creating a new business is exciting, challenging and requires all of you to make it successful. By learning to build a successful business those with true entrepreneurial spirit will develop a profession few will ever achieve.
Remember though that nine out of ten new businesses fail despite plans that communicate great opportunity. In reality, most businesses fail not because of poorly written business plans, they lose because their owners don't prepare themselves for the real world of business. So before we begin the "how-to" section of this book, it's critical that you answer two key questions:
1. How bad do you want to win? This is the first question to ask yourself as you begin the journey of turning your dream into a winning business plan. If your inner-drive and motivation to start a business aren't big enough, the "how-to" of a plan doesn't matter.
2. Are you mentally prepared to own your own business? Dreams are romantic gestures that provide great inspiration. With a business plan, inspiration meets perspiration. Starting your own business will take everything you have. The common theme in all novice business plans is an underestimation of the time, energy, experience and money necessary to build a winning business.
Each business plan has a price. Most people want successful businesses but are not willing to first invest the time. They want get rich quick schemes and often start businesses without basic skills. Most people do it "their way" instead of investing in study and building a team of competent advisors.
Great business plans come from entrepreneurs willing to delay immediate gratification. They take risks and invest the time and energy necessary to gain relevant experience and education. They are not afraid of making mistakes or failing because mistakes and failure equal experience. They start small and build, recognizing experience leads to greater ability. After paying the price, true entrepreneurs gain the knowledge to build a winning plan and winning business.
Most business plans are written to attract funding to start a business or expand an existing business. Plans are also written to help existing businesses grow, but that aspect of "strategic planning" is different than the focus of this book, which is to provide a framework to convince an investor, and yourself, that your plan possesses the necessary ingredients to become one of the 5% of new businesses that succeed. Savvy investors and lenders know the odds and unless you educate yourself on the realities of winning plans, your plan will likely make its way to the bottom of the waste basket.
Business is a plan, not a product or procedure. Good plans expect the unexpected, but remain intact and in use throughout the trying early years. They just keep getting improved upon as you learn more. Your personal plan can be financial freedom-freedom from the day to day grind of working for money. But your business plan has to answer the following questions for investors and lenders:
1. Can I make money investing in this business (risk vs. reward)?
2. Do I like and understand the business I'm investing in?
3. Do I trust the people I am investing with?
It's also important to note that winning in business has much more to do with entrepreneurial spirit than it does with age or gender. You're never too old or too young to be a successful entrepreneur. In Rich Dad's Guide to Investing, Robert Kiyosaki and Sharon Lechter describe the personal traits of a successful entrepreneur:
1. Vision: Ability to find opportunities others cannot see
2. Courage: Ability to act despite tremendous doubt
3. Creativity: Ability to think outside the box
4. Ability to withstand criticism: There is not one successful person who has not been criticized
5. Ability to delay gratification: It can be very difficult to learn to deny short-term immediate self-gratification in favor of a greater long-term reward
So as you begin to write your plan, ask yourself if you truly have the tenacity to fail and start the challenge again. Nearly all successful entrepreneurs have had many failures. The beautiful thing about business is that you don't have to be right 51% of the time, you only have to be right once.
RICH DAD TIPS
As you begin the process of creating a new business surround yourself with successful and like-minded people.
Take the time to really think about what you want in this gift called your life. Many new businesses owners have a dream of freedom and end up creating a "job" for themselves.
Don't forget to plan your exit at the beginning. Too many people get caught up in starting a business and fail to think about preparing for its end goal.
There is never a perfect time to start a business. If you want to live your dream, prepare yourself as well as you possibly can and then take action!
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Excerpted from Rich Dad's Advisors The ABC's of Writing Winning Business Plans by Garrett Sutton Copyright © 2005 by Garrett Sutton, Esq..
Excerpted by permission.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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