4 Reasons You Don’t Need a Business Plan for Your Startup Idea

4 Reasons You Dont Need a Business Plan

Yes you need a business plan for your startup but it's not the one that you're thinking of.

Planning is the essential step to starting any type of business.

It's sets the direction and gives you the proper steps you need as you get started.

But the 20-page business plan that we've created in the past is not the first thing you need to do.

Learn how Kim Kaupe, co-founder of ZinePak shares how her and her business partner wrote their business plan on a napkin.

This is the perfect example of focusing on execution instead of being held up in the planning phase.

Starting a business comes with a lot of unknowns.

Your original idea will change many times as your start to talk with your target customers.

Your idea may have started out with a complex version of itself but then realized your customers wanted something totally different and simple.

Spending too much time writing an extensive business plan will not allow you to learn these findings early on.

The biggest reasons why startups fail (42%) is because they create a product that the market doesn't want.

71% of businesses fail within 10 years.

With that being said, it's critical to plan but to start of planning the 'right' way to support your business.

Fortunately I've created companies like Startups With No Code, Troop Pack, and Brew Tender using this same strategy.

I'm happy to share my knowledge and experience to help you implement the proper planning into your business.

Along the way there will be many ups and downs but this post will help you to prepare for them.

We'll outline the reasons you should write a traditional business plan and the productive alternative steps to take.

You can use this as a guide to plan your next business.

Waste of Time and Money

Every business should start out with a plan and measurable goals. But the real question is how detailed should you get?

The traditional business plan serves the purpose of planning from point A to point B.

The problem with creating a business plan for a startup is there isn't enough information in the beginning.

"Planning and forecasting are only accurate when based on long, stable operating history and a relatively static operating environment." according the Eric Reis author of Lean Startup.

Focusing on a business plan from the beginning for a startup takes you further away from some critical goals to start out.

The most important thing to remember for a startup is your idea is just that.... an idea!

There's not guarantee that anyone needs it or will pay you for it.

It's your job as the entrepreneur to test and figure those things out.... quickly!

The key principle for planning for a startup are the following:

  • should be about speed, learning, and focus
  • testing and visually seeing how customers behave
  • engaging customers early and often
  • focus on both product and market validation
  • disciplined and stick to the process

None of these principles are possible if you're stuck at a desk for weeks or months writing a business plan.

More Action and Less Planning

While planning is critical you can't replace what you'll learn by taking action and executing.

You can sit in your office... plan the perfect idea, the perfect price, the perfect software, or best functionality.

All of that is worthless if your ideal customer doesn't find any value in it.

As soon as you get an idea in your head your first thought should be to share it and get feedback.

Many entrepreneurs get stuck with ideas in their head because they are scared to share ideas with their ideal customer.

This could be for a variety of reasons:

  • fear people will think it's a stupid idea
  • fear people will say it will not work
  • fear someone will steal it and implement it

The sooner you start talking with customers the faster you will learn if you're onto something, need to adjust, or shut it down.

Going back to the speed principle... it's important that you learn lean and fast.

Struggling to come up with startup ideas and need some help? Check out our Idea Accelerator program!

The last thing you want to do is to spend too much time on a bad idea or one customers don't see value in.

Majority of people building a startup work 9-to-5 jobs, have families, and tons of other obligations.

There isn't a lot of time readily available to do all the things necessary to launch your business.

So learning with speed is critical.

Below you'll learn how customers will dictate the planning and tasks you should be doing.

Customers Determine Your Planning

You can have the best idea in the world, but if you don't have 'paying' customers then it doesn't mean anything.

As you start to talk with customers, starting with your idea they will determine what critical tasks you should be focusing on.

When you initially share your idea, your ideal customer may say...

"The idea sounds great, but what about if you did this or did that...?"

If you share your idea enough to your ideal customer, you'll start to develop a pattern of these changes.

This forces you go back back and make changes to fit the need of your customers.

Once you have validated the idea, now it's time to plan out the mock-up.

Your mock-up is a drawn (no code) version of the idea your customers are expecting.

You will use this cycle until it's time to build officially code and build your final product or service:

Instead of spending weeks or months writing a business plan you actively talking to customers, learning, and building along the way.

This all sounds easy, but there are of course some challenges along the way.

Use a Single Page

Although many spend too much time on business plans, another good percentage keep their ideas or plans in their heads.

Which is another huge mistake.

The first and most critical step is the write your vision down and then share it with at least one other person.

Since we already know the first version of your plan is likely wrong, you need something flexible and less rigid to document your idea.

Writing a 20+ page business plan consist of spending time documenting unproven hypothesis is huge form of waste:

Similar to Kim Kaupe using a napkin to document their initial business plan, you can use the lean canvas.

Initially created by Alex Asterwalder, the lean canvas provides you with three key effective principles for your startup.


Compared to writing a business plan, the lean canvas trims your planning down from weeks into one day. 

You can quickly create multiple versions of your plan to see which is the most effective through 'proven' tests.


The lean canvas forces you to get straight to the point of what problem your startup addresses and the solution you provide.

Which is critical when you're sharing your idea with other people. It prevents you from rambling.


The lean canvas is portable... you can take it with you when you talk to customers. Update it on the fly no matter where you are.

Imagine transporting and sharing a 30+ page business plan with your ideal customer??

There are several things that's critical to include on your plan:

  • the problem you will be addressing
  • your solution
  • types of customers
  • revenue model
  • marketing channels (where your customers are)
  • your secret sauce compared to existing competition

All of these are critical things that will drive your initial planning and test as you start to validate your idea.

Be prepared to create multiple versions of your lean canvas (or business model canvas).

There are many things that are sure to change as you start talking to your customers:

  • your initial problem you're addressing could change
  • your pricing could definitely change
  • your soultion
  • revenue model
  • types of customers

These are all changes that you could NEVER find out writing a 30+ page business plan.

Above is an expanded version of what it looks like implementing the Learn, Measure, Build method to building your business.


Let's recap.

Launching a business is hard and business planning is definitely a necessity.

Most of your efforts should be focused on executing, testing, and learning not writing a 30+ page business plan.

You need to ensure your efforts are focused on your ideal customer's feedback first.

You do this by getting out and talking to them:

Even though this doesn't ensure you will succeed because 90% of startups fail.

It ensures that you're not spending too much time on bad ideas and creating products the market doesn't want.

With that said, now having the proper guideline will help you to simplify the process for you.

Based on what we've discussed, you know have the steps to create an effective plan for your startup.

Start by using the lean canvas to create your plan.

Your plan will help you know what problem you're addressing, your ideal customer, and the solution you will bring to the market.

You'll need to test and pivot....

As you start talking to customers you know have the tools update your plan.

Launching your startup will not be perfect so you need to prepare for those challenges as they come up.

Proper planning and the right tools will help you mitigate the impact.

What tool do you use to plan your business from the start?

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