A business plan is worthless if it does not bring the expected results. We believe the following have proved why many business plans failed:

1. Business plans oversell

Many business plans are written like a marketing brochures trying to sell information to investors on your business.

2. The product features and market opportunity overemphasize

The business plan persuades investors by trying to convince them that your product or service is the greatest and that the market has a huge unfilled need that no one else sees. As a result, the plan leaves too many questions unanswered.

3. The business plan doesn’t discuss the business

The business plan fails to tell investors the very thing they are most interested in knowing on how you’re going to take in much more cash than you spend; the cost of everything the business needs to do to achieve its revenue target; and the timing involved in managing working capital needs, expanding payrolls, and on-going customer acquisition expenses.

4. The business plan makes it sound like the business simply can’t fail

The business plan is not focusing on the risks that investors’ experience will surely tells them that businesses like yours are inherently risky. In fact many businesses fail because of overconfidence, lack of customer orientation, missteps by management, poor financial discipline, bad luck, or some combination thereof.