As much as it is counterintuitive, throwing away your business plan is the best thing you can do before investing.
While business plans are not entirely bad, they tend to either be very far from reality or induce paralysis by analysis.
We don’t need one case study to prove why you don’t need a business plan given at this point you must have seen endless stories of people who started out with as little as Kshs. 1,000 and built multi-million-shilling businesses.
Just start
The founder of Bonfire Safaris, Simon Kabu, started the company with Kshs. 20,000 and it is currently among the biggest local travel agencies. He was previously a tout.
Bernice Gathika, the founder of Jade Collections, started by buying and selling clothing items in the ‘hawking’ format and this is how she built her clothing brand Jade which is among the biggest fashion retailers in Kenya.
Mohammad, the founder of Moha Graphix started out by drawing his first matatu graffiti purely based on his belief in his talent. He was previously a salesman. His brand now nets in as much as Kshs. 150,000 per graffiti with an average of 5 matatus drawn each day.
These are just the prominent stories of entrepreneurial excellence because there are hundreds of other Kenyans that have achieved similar levels of success but remain unknown.
Interestingly, Simon Kabu, Bernice Gathika and Moha Graphix do not mention business plans in their stories. Rather, they simply started pursuing something they could do well.
So, you are throwing out your business plan because one prominent piece of advice that stands the test of time is that you just need to start.
It does not matter what it is or what approach you take as long as you start. A good challenge that can be borrowed from a prominent investment advisor is to just go out and make Kshs. 10,000 in profits. It does not matter how you make the amount as long as it can fall within the definition of a business.
So maybe sell clothes, hawk shoes, sell eggs in bulk, wash cars, etc but make sure at the end of it you have the profit of Kshs. 10,000. This challenge will teach you more about entrepreneurship than half of the business classes offered around.
Account for failure
A major fault of most business plans is that they do not account for possible failure.
As Vusi Thembekwayo, a South African business speaker put it, all business plans show a profit projection that will grow bigger with time, never do they show losses.
By starting off without a complex business plan, you get to learn hands-on what is important for the business and adjust as you go. And in the case that you fail, you will know what not to do in your next business.
A good example is a small hotel (let’s call it Hit) that was started along Thika Road.
Rumor was that the owner put in around Kshs. 1 million. Hit failed after about 5 months and it failed because it was priced like a mid-tier hotel at a place where most target customers ate in vibandas.
While it may be painful for the owner to lose such a vast amount, the next business they start will be better because they will know to start small and understand the market before scaling operations up too much.
Paralysis by analysis
There is a fear factor to starting anything entrepreneurial. A big cause of this fear is overanalyzing every detail of the venture to the point that the implementation never happens.
It feels rational to want to know all the costs, the risks, the benefits, advantages, disadvantages etc but then it is true that all these cannot be known in advance.
The same goes for looking through mountains of information from books, YouTube, blogs etc trying to find the perfect way to set up your business. There is no perfect way to begin. The start will likely be messy and discouraging.
This is why a business plan will likely derail your idea as it displays an ideal picture of how the business will run.
So, throw away that business plan you wrote and simply start.
