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Ask HN: How to write a business plan for a web startup?

4 points by alexwyser ↗ HN
I am building a social network and would like to write down a business plan that outlines the goals of the site and the long-term vision, as well as financial projections.

However I cant get started since I have no idea how to structure the entire thing.

There are a lot of resources online about writing business plans for a non-web business, but I cant find any that helps out with writing a business plan for a web-based app or service.

Any ideas where I can get some help? Any resources you guys know of?

8 comments

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thaumaturgy
What are you wanting to accomplish with the business plan? Not that it's a bad idea really, but if it's currently your only hurdle to building this thing, then just jump over it and keep going.

One of the nice things about web startups is that they don't tend to require this sort of pre-planning planning. Just build a product, launch, iterate, get help as you go.

alexwyser
I'm not keeping myself from working on the site to write this, but I would want to write one down just so that we can focus on the objectives of the site and everyone involved with this project is on the same page.

Plus, I feel that actually writing down a formal structured plan would give us a clearer idea of what we should do and how we should do it (not just for development, but marketing as well)

thaumaturgy
I'm not qualified to give advice to anyone on business matters, so I won't. However, I will say that your current approach is opposite of what the current popular mindset is in building web startups. (Whether that mindset is actually correct in any way or not could be a matter of some debate.)

You almost certainly are going to change your project's direction over time. Things that seem do-able now, or seem to be good ideas now, will be less feasible or less shrewd six months or a year now. So, if you lock yourself into this formal and structured plan, you might be foregoing the ability to maneuver quickly and change direction later on; and if you don't give those things up, then you're wasting some resources on something that you might be throwing away later.

In terms of marketing, your best bet is to advertise what you actually have, not what you intend to build, so again, the business plan doesn't help there.

That said, I can't disagree with having some direction, some goals, a roadmap, and a well-defined project to start with. But, those things don't need to be "formal"; a whiteboard (if everyone is local), or good project management software would accomplish that just as well.

Now that I've done my utmost to avoid answering your question: one of the few business development books that I actually found helpful before launching my own business was "The Six Week Startup" [1]. It does a nice job of breaking down the entire business launching process into digestible, well-defined bits. If you really want to go with the traditional business development strategy, then I think this book might be what you're looking for.

[1]: http://www.amazon.com/Six-Week-Start-Up-Step-Step-Achieving/...

xash
What you need is something like this: http://www.paloalto.com/business_plan_software/

I've used it, and it's pretty good.

It will create the entire structure for you, so all you have to do is fill in the data. It might have sample business plans for a web based business, which you can edit to suit your objectives.

ddemchuk
Don't.

Write a technical spec and marketing goals/strategies. Any financial projections you make will be wrong.

The most important part of your plan will be a functional prototype

Mc_Big_G
Unless you have a sure-thing outside investment deal just waiting for your business plan, don't waste your time. If you decide to go ahead anyway, go ahead and "outline the goals of the site" but throw away the long-term vision and financial projections.

I can't think of anything more useless than long-term anything/financial projections for a startup. Both are simply fantasy, with no basis in reality.

I know it's really cliche these days but you need to identify the one, or a maximum of two, goals for the site and just build it (minimum viable product). Trust me on this. I spend 2+ years building something grand that just fell on it's face. I would have liked to have figured that out 2 years earlier. Every "feature" you think is going to make the site great is really just a liability and time sink.

Unless you have a lot of cash, your only asset is time and writing a business plan is wasting it.

imp
A fully-polished business plan may be a waste of time, but it is definitely useful to put together financial projections for a couple years in the future. Especially for a social networking website. If his only revenue stream is advertising, he'll quickly learn how many pagviews and users he'll need in order to make money. If he does research into it and finds out what the average CPM, PV/visitor, etc. are, then he'll learn a lot and maybe change strategies. A few days worth of research and planning are worthwhile if it can prevent wasted development time.
alexwyser
After careful though based on everyone's feedback, I decided to go with jotting down the broad objectives and an informal list of specific objectives and a tentative budget for marketing.

Perhaps once we have the site completed and launched and there is some growth, I can rewrite the plan in a more formal manner based on the usage of the site.