MHR 423 Creating the Business Plan Spring 2006 Dr. Stan Abraham MHR Dept.

Principal Course Objectives To understand what goes into, and write, a business plan for a new or emerging business needing financing To make a five-minute convincing “pitch” of that business plan Two Prerequisites MHR 320 or EBZ 306 MHR 321

Required Text Kathleen R. Allen, Launching New Ventures: An Entrepreneurial Approach, third edition, Houghton Mifflin, 2003 Dr. Allen teaches at USC –She is also involved in commercializing intellectual property created at the university

Required Text (cont.) This is the best text I can find on the subject of launching ventures and writing a business plan Previous students have had mixed responses to earlier editions of it –Many thought it was fabulous –Others never bought it, read it, or missed it How serious are you in becoming an entrepreneur? Can you do it alone?

Value of the Course Most entrepreneurs have no formal education in entrepreneurship Some even have no formal education! Many have never written a business plan Many are engineers, scientists, artists, or other professional that have no business experience or acumen whatever Epitomizes Cal Poly Pomona’s philosophy of “learning by doing” You will actually write a business plan and do a five-minute pitch for the business at the end of the quarter before invited guests (investors or other knowledgeable people)

My Expectations of You Take more responsibility for your own learning You won’t learn as much if you don’t Commit to having a very good group experience Your workload and stress level will increase exponentially if you don’t, and your grade will suffer proportionately Plan carefully and organize well There is a lot to get done in the quarter Pay attention to all deadlines Get started early

My Role as Professor To create a friendly and fun environment for learning To act as a resource, coach, expert, and sounding board for you as you develop your business plan To provide useful feedback at all times –Especially when grading your assignments To give mini-lectures on each topic based on my experience Will supplement the text nicely

The Business Plan Done in groups Based on a business idea you come up with Written in stages Improved through feedback from grading Experience putting the whole plan together –Everyone be responsible for the whole document Culminates in a 5-min. dazzling presentation before guests External Analysis Financial Plan and Projections Marketing Plan Final Business Plan

Participation Grade (10 pts) Nothing happens until I know all your names (week 3 or 4) Attendance gets four points Remaining six points for asking questions and contributing to discussion during video discussions and final presentations –I scale all participation at the end of the quarter relative to the student that has participated most Each unexcused absence over two loses one point More than five unexcused absences (i.e., six) gets an automatic ‘F’ in the course

Written Work First drafts must never be handed in I will not grade a first draft Always edit your work once, preferably twice Consider assigning someone this critical task Business writing is concise and clear If you find writing difficult, you must go to the University Writing Center for help Take pride in your work—a quality business deserves a quality business plan Final reports poorly written will lose points Ask questions about anything you are not sure of

Videos and Discussion On each of three video sessions, I will show a video of two startup companies making a pitch to a panel for funding –After each company founder has appeared before the panel, the class will discuss which of them deserves the funding more –Then a final clip will be shown with the decision of the panel as to which one it considered better The experience puts you in the role of investor The class discussion part will earn you participation points, but is otherwise not graded

Learn what others said… Course evaluations from Fall 2003 and Spring 2005 are available for you to see on my website under MHR 423 –You will see that I take the feedback seriously and improve the course as a result Feedback I gave to groups in those classes on their Marketing Plan is also available for you to read on my website –Names have been removed to protect the innocent –The feedback may induce you not to make the same mistakes –You will note my feedback is constructively critical and more severe than the grades I gave

A Final Word Past students felt tremendous pressure all quarter long to get the work done –So get started right away –Set earlier deadlines and stick to them –Leave time to edit your work Past students found the Financial Plan and Projections to be the most difficult –Come see examples of business plans in my office –Get help

A Final Word (cont.) A business plan has other sections besides the early drafts you turned in –Don’t forget about them Past students complained about most of the grade being earned through group assignments –You need the group to do the work –Make sure everyone in the group contributes Short of actually starting a company, this will be the most useful training experience you could possibly have as you prepare to start your own company

Any Questions?