This last weekend GIBS hosted the second annual MBA Business Plan Competition. 38 student teams from the Entrepreneurship MBA and Modular MBA programme participated in the competition.
The day was filled with energy, nerves and excitement as all the students presented their business ideas to panels of judges in the morning with the seven best business plans going though to the final in the afternoon. In the final there were a broad range of ideas from businesses delivering solar power solutions to a debtor financing platform to a furniture manufacturer to a massive mining operation. In the end the winner was Colin Daniels with his business plan for a mobile ticketing platform. In arranging this competition for the MBA students I gleaned some interesting insights about entrepreneurship and selling new business ideas. Here what I learned…
1. Small things make a big difference
When presenting a business idea, the details matter. People are making a judgment about you and about the business in a very short window of time. They are therefore inferring a lot from a very small amount of information. Make sure that what you present to them is excellent. The slides must look good, the plan must be perfectly coherent, you attitude must be right and you must answer questions with care and humility. Focus on the small details to have a big impact.
2. Execution is everything
There are many good ideas floating around. What sets them apart is what people do with them. Those students who were already executing on their idea where in a much stronger position than those who were just presenting a concept. Ultimately you will be judged on what you are already doing and not just on what you say you will do. To build traction for your business make sure that you assemble a team, develop a pilot product or service, get some early customers and report real results. It sets you apart!
3. Borrow what you can and build only what you have to
Many would be entrepreneurs think that they need to build everything from scratch. They think they need to design and build the product, write the software or establish a new distribution channel. One thing I realized at the business plan competition is that savvy entrepreneurs borrow everything they can and assemble what they borrowed to create an innovative new product or service. Many times a significant part of the solution has been developed elsewhere and it is the entrepreneurs role to get the right to use what has been developed and to adapt it to a new market space. Building stuff from scratch takes time, is expensive and very risky. Borrowing everything that you can and building around it means that you can get to market quickly, without breaking the bank.
4. People want to help
One of the things that struck me about the competition was just how much people in the community want to be part of it. My greatest joy in arranging the competition was finding judges. Everyone I asked to participate as a judged gladly agreed or if they were unable to do it asked me to keep them in mind for next year. People want to see new business ideas succeed and they want to play a part in making that happen. They just need to be given the opportunity to contribute. For entrepreneurs this means that you have to be active in seeking out a support network for your business. When you ask people will respond. Ask experts to be on your board of advisers, seek counsel from those in the know and never be scared to call in a favor to make your business succeed.
5. Make the numbers work but its not about the numbers
A new business concept needs to make sense financially. Based on the calculations that you present, you need to show that the business can make a profit within a reasonable period of time and you need to demonstrate that you have thought clearly about the economics of the operation. But that’s not enough. Investors know that anyone can make a business look profitable on an excel spreadsheet. To really sell the business idea you need to demonstrate that you know everything about what you are doing. Use a discussion about the numbers to show that you really understand the industry, show that you have investigated the competitors and show that you have really delved deep into the drivers of business success within the context in which you are operating. Talking about the economics of the business provides an opportunity for you to demonstrate the real passion that you have for what you are doing. The more you know, the more passionate you will appear, and the more others will be interested in what you are doing.
6. Get going
At one point during the final presentations one of the judges looked at the participant and said to her, “You can keep planning, you can keep researching, you can keep developing financial forecasts but in the end you just need to get going. There comes a time in the business creation process when you need to stop planning and just start doing. You will learn so much more from doing compared to planning.” The risk with a business plan is that it seems like it is never complete. We always want to do one more thing, check this, confirm that or run one more spreadsheet. This approach is anti-entrepreneurial. The true entrepreneur uses the plan up to a point and then sets it aside and takes action. There comes a time when you just need to get going.
7. FNB cares about entrepreneurship
Without me even asking, and without expecting anything in return, FNB offered to come on board and sponsor a significant cash prize for the winner of the competition. Having worked with FNB on a few of their Biznetwork events, I have always know that they care about entrepreneurship in South Africa but I was taken back when they approached me offering to support the winner of the competition with a chunk of seed capital in an FNB account to help them get their business off the ground. What a great gesture confirming that as an organization they are looking for opportunities to help bring good business ideas to fruition. Thanks FNB!!!
Thanks to all the judges, participants and supporters that made the 2011 GIBS MBA Business Plan Competition a great learning event for all involved.