If the need to create a formal business plan is holding you back from starting your own company, take heart. Ruth Hayden says those plans never work out, anyway.
"There was an article in the Wall Street Journal about a year ago that said, 'You know those 46-page business plans that you develop in that class you took? When they hit the market they fall apart,'" said Hayden, a consultant and personal finance educator.
Instead, she said, an aspiring entrepreneur can boil the business-plan function down to four simple questions.
"I have developed a four-part business plan," Hayden said, "and I tell my clients, 'Work with it.' It covers everything the 46-pager does."
1. What do I do? "It is a description, a clear description, of your product. What do I do, specifically?"
2. Who do I do it with? "That's a clear description of who the market is."
3. How am I going to tell those people, that market, what I do? "And that's where you use the social media and your contacts, the same stuff you do when you find a job."
4. How am I going to get paid? "How do I charge?"
Hayden said she tells clients who want to start a business to "play with those four steps."
"'What do I do?' Well, maybe I could do this. And do a whole different one. At some point, you'll go, 'You know, that could work. That could really work.'
"It really works because it keeps it simple. It keeps it clear. It works."
LEARN MORE ABOUT STARTING YOUR OWN BUSINESS:
• Self-Financing Your Startup
The best place to begin is by looking in the mirror. Self-financing is the number-one form of financing used by most business startups. In addition, when you approach other financing sources such as bankers, venture capitalists or the government, they will want to know exactly how much of your own money you are putting into the venture. After all, if you don't have enough faith in your business to risk your own money, why should anyone else risk theirs? (Entrepreneur)
• Why Too Many Entrepreneurs Don't Know How to Raise Capital (Entrepreneur)
• 10 Ways to Finance Your Business (Inc.)