Is a Business Plan Necessary?

I found this article by Guy Kawasaki on how formal written business plans do not help in business success rate very interesting. Richard Branson uses one page and writes by hand the aspects of the business to minimize the downside and understand the business model.

This study examined whether writing a business plan before launching a new venture affects the subsequent performance of the venture. The data set comprised new ventures started by Babson College alums who graduated between 1985 and 2003. The analysis revealed that there was no difference between the performance of new businesses launched with or without written business plans. The findings suggest that unless a would-be entrepreneur needs to raise substantial startup capital from institutional investors or business angels, there is no compelling reason to write a detailed business plan before opening a new business.

I’ve never had a project, business, launch go according to plan. Ever. Yes, some more smoothly than others, but never the way I thought it would.

And that’s because I’m constantly learning.