Instead of a Business Plan, write a Thesis Plan

A replacement for the normal business plan might work for startups, where traditional planning square pegs the round hole.

If the scientific method was good enough for her, it’s good enough for you.

Startups, by definition, traffic in the unknown. Business plans are, for founders, a futile-feeling exercise in predicting the future. (“Am I trying to show my investors I’m ambitious? Or realistic? What kind of guesses do they want me to make when I still need to figure out how we’ll make money?!”)

Maybe there’s a better way: a plan which, instead of predicting your achievements and the results of those achievements, identifies the unknowns you plan to make known, aka the hypotheses you plan to validate. (Paging all you Lean Startup people…)

Call it a Thesis Plan (because it’s better than my original name of a Guessness Plan, which rhymes with business plan?… I’m a dad, OK).

Startups begin life with an intention — “there must be a better way to buy and sell bonds than calling up a bunch of people all day long and comparing prices?!” — and a guess as to how to act on that intention — “what if we put bond prices on a computer so people could just look them up instantly?” Startups advance by making the unknown known, using intuition and data to validate the building blocks of a business. (For example: It’s technically possible to list bond prices and share them with people in different offices at different times… buyers want to know prices in real time… they’re willing to (Read more...)