Business plans are the heart and soul of any business, they are indispensable for any type of business, from corporate to startups. It helps to articulate any new project, strategy, or the whole business.
While business models and MVPs are great to showcase a new startup, without a business plan to guide the process, any startup is destined to fail. For entrepreneurs business plan should be their holy book since it will help them in:
– Proof of the feasibility of the business.
– Clearly identify the business model, and unique selling point and reduce the risk of wrong opportunities (no market need.)
– Establishing business goals and KPIs to measure performance.
– Analyze competition
– Provide detailed insights about the market and the target customers.
– Identify and document financial needs and projections.
– A base for raising capital, investors first look into the business plan before proceeding with anything.
Introducing Business Plan Contests
Business plan contests are one of the most popular entrepreneurship activities in many business schools, incubators, and entrepreneurship in the USA and Europe. Founders are challenged to develop a new service or product offering and then create a business plan to convince potential investors to finance the business.
One of the world’s most famous business plan contests is the Rice Business Plan Competition organized by the Rice Alliance for Technology and Entrepreneurship for 21 years now. Over 20 years, it has grown from nine teams competing for $10,000 in prize money in 2001 to 42 global teams competing for more than $1.5 million in cash and prizes.
Business plan competitions are usually excellent opportunities for founders to raise investments for their business ideas, receive direct feedback on their business plan, and have exposure to the right audience.
Many universities organize business plan competitions to provide a meaningful learning experience for students interested in considering setting up their own businesses at some point in their careers.
Business Plan contest VS Idea Hackathons
Hackathons or idea sprints are other forms of entrepreneurial activity that have been very popular in the last decade; it was copied and iterated into different formats with the same concepts globally. Hackathons have been very popular in the MENA region.
A hackathon is usually hosted by a tech company, university, or other organizations where developers, marketers, and designers form a team to work on a project for 48 hours. Corporates often used hackathons to generate new solutions for a business challenge or come with ideas for new product lines.
Although it has been proven that idea hackathons can be very effective to provide cool, innovative ideas, almost 95% of these ideas are usually discarded and no one pursues them, so they remain just ideas. We have all seen it, the team gets the monetary prize and disappears, and everyone goes back to their lives.
On the other hand, a business plan contest gives the teams time to collaborate and work together for at least a month, enabling them to consider every detail of the business and creating a robust structure for a new business.
These types of entrepreneurial activities have a more positive impact on launching new businesses. It encourages investors to consider putting money into the ideas to help them get off the ground, as they can see the business’s feasibility and its projections so they can easily decide to invest in it.
Cool startups that came out of a business plan competition
35 startups that came out of the Rice Business Plan competition over the years have had successful exits, and more than 230 startups are still up and running to this day. Teams participating in the Rice Business Plan Competition have raised more than USD 2.7 billion collectively.
Diagnostic-for-All (DFA), a new business that came out of Harvard Business School, business plan competition, has managed to grow exponentially after the competition. In 2011 they received $2.99 million to develop three new agricultural tests from the UK Government and The Bill & Melinda Gates Foundation award. In 2012 they were awarded a $2.6M grant from the Bill & Melinda Gates Foundation to develop a novel diagnostic for assessing immunity status against tetanus and measles to support vaccination efforts. In 2015 they were awarded a Saving Lives at Birth grant for a new antenatal test.
Open Call to introduce Business Plan Competitions in MENA
A Couple of years ago, when I started BznsBuilder my sole purpose was to facilitate starting new businesses and support founders in their journey. Being a serial entrepreneur myself, I understand the hassle and distress that comes with starting a new business.
I founded BznsBuilder because I believed that to have a successful business, one must have a strong business plan that guides the journey and facilitates investments and accelerates growth. BznsBuilder is built to be the technical co-founder for every founder facilitating the process of creating business plans and generating real hassle-free financial statements.
I would like to extend an invitation to our local ecosystems, investors and universities here in Egypt, UAE, Saudi, and all MENA to start investing in launching business plan competitions. It will increase the success rate of startups coming out of it. It will also encourage more and more people to start building their business.
Business schools in universities should start this activity for their undergrads, encouraging them to take charge of their lives and start creating new businesses rather than looking for a job.
With the fantastic announcement of Sawari ventures closing a $ 71 million fund for North African startups and Algebra ventures launching its $90 million funds for Egyptian startups, I would love to see both organizations and other VCs adopt this new concept and validate them in MENA.