No business plan.
There is no single omission that bodes worse for a start-up's future than the lack of a comprehensive business plan. Serving as a prerequisite for financing, a schedule for product rollout, and a road map for principals and employees, the business plan is a critical element of any start-up.
A well-crafted business plan addresses all the ingredients of success: your management team and employees, the opportunity you're pursuing, the competition you're facing, and the potential risks and rewards. Failing to think these elements through could be a fatal flaw in your start-up.
When formulating your business plan, follow the KISS (Keep It Simple, Stupid) philosophy while taking care to cover all primary areas: management, capital requirements, market opportunity, competition analysis, exit strategy and execution schedule.
"The best thing about a good business plan, from an entrepreneur's point of view, is it helps in organizing your thought processes," says Virgil Carroll, CEO of iStreamInteractive, an Anoka, Minnesota, custom e-learning developer. "The very nature of an entrepreneur is to constantly evaluate new ideas and business strategies. Without some direction to control these outbursts of creativity, chaos can consume your business. With a good business plan, you can look at your ideas and say, 'Hey, this just doesn't fit right now,' and instead of making a big mistake, you put it in the 'for future consideration' pile."
A consultant can help you write a business plan. For do-it-yourself help, visit our Business Plan center. The bottom line: Don't even bother getting started without one.