Growth Plan vs. Start-Up Business Plan
If you're looking for expansion capital, potential investors will want to see a growth plan. Here's how it differs from your business plan.
A growth plan should emphasize how you will reproduce your previous successes. Rather than hypothesize about potential new markets or products, a growth-stage entrepreneur needs to think about making his or her operation conform to rigorous financial and operating standards while implementing repeatable policies and procedures.
Where the start-up plan may have a few sections on research and development, a growth plan should focus on your company's rollout and expansion. A fundable growth plan will be heavy on operational details such as staffing, sales, marketing and production. In the start-up phase, important financial ratios like gross margin are a poor guess at best, and a happy fantasy at worst. A growing business, however, has the advantage of using real operating results to project future growth. Any growth-stage funding plan should reflect actual results whenever possible.
Further, the level of financial detail available to--and expected from--a growing business is beyond anything a start-up could dream. How many prospects turn into customers? How many service staff does it take to support 100 accounts? How much will the phone bill be? Specific answers to these kinds of detailed questions are vital to the credibility of a growth plan, and they should replace the broad assumptions inherent in all start-up plans.