Talent profiles must make important part of business plans

Managment team: Do they have special skills for the business? PHOTO | FILE 

By SCOTT BELLOWS

In Summary

• Section provides backgrounds and roles of key team members, directors, and advisers as well as recruiting strategies.

Nyan’gara spent weeks creating what she deemed as the perfect business plan.

She pored over the financial projections with her accountant and financial advisers. She reminisced about the firm’s founding and Nyan’gara peered into the future with her piercing strategy.

Widely known as an agricultural expert, she decided to take her firm into a new product line: rural transport. After putting her heart and energy into the business plan, she attached her CV to the back as an appendix.

Nyan’gara then printed her business plan on glossy paper with brilliant colours. She hand delivered copies to Nairobi investors and banks from Barclays to Open Capital to Novastar. She hoped that the personal touch would foster relationships and solidify funding for her new product venture.

Unfortunately, Nyan’gara failed to secure any funding during her first round of requests. Aghast, she pushed firms to inform her why she failed to acquire commitments. A polite deputy at a major Nairobi investment firm confided in Nyan’gara that their investment committee felt concern that the new product venture lacked adequate skills from competent managers in Nyan’gara’s company.

Nyan’gara then realised that she neglected to paint a full picture of the managerial and governance structure at her entity and specifically with the new product venture.

Now in the fourth week of the Business Talk mini series on how to write a business plan, we explore an often misrepresented component: management team summaries.

Many entrepreneurs just paste their CVs into the business plan. They often pay no attention to inconsistent fonts or too much space on ancillary data.

In short, every business plan should include a section on the management team. Under the Hudnut business plan template, the section provides backgrounds and roles of key team members, directors, and advisers as well as identifies human resource needs, organisational structure, and recruiting strategies for gaps.

Nyan’gara lacked specialised skills in rural transport. However, she failed to show that she understood the gap in her own competence. Just because an entrepreneur does not point out a gap does not mean that their readers will not notice holes.

Investors forgive many gaps if an entrepreneur identifies them in advance and shows an understanding for how they will fix the breaches.

Nyan’gara could have shown she would fill the fissure with advisory board members, team members brought onboard with equity if cash is tight, or how she will gain the knowledge herself. Investors also like to see teams starting new businesses or product ventures instead of solo entrepreneurs since lone entrepreneurs hold a much higher failure rate.

So, show your ideal organisation chart. Clearly indicate which positions are filled and by whom and which posts are vacant and when you intend to fill those vacancies. Regarding vacant positions, you should delineate the type of skill sets you require for the positions.

Every Business Daily reader is encouraged to write a professional biography right now. Start off by writing in the third person as if someone was writing your biography. Therefore, avoid personal pronouns “I” and “me” and instead use your name accompanied by “he/she” and “him/her”.

Remember that your business plan and your included biography paragraph should come half way between a sales brochure and an objective audit. You want it to look objective while still selling yourself as a commensurate professional.

As an example, avoid flattering phrases such as “Nyan’gara’s brilliant execution of firm goals” and instead use calm yet convincing terms, like “Nyan’gara’s solid execution of firm goals”. Over-selling yourself calls into question the objectivity of your entire business plan. Conversely, you must build excitement about your capabilities.

An integral component to every investor or banker’s decision to invest or lend is their belief about your character. How do they gauge your character? Stakeholders will clearly do background checks and reference checks. They will read about you from online sources. However, the biggest psychological factor encompasses your likability.

If an investor or banker likes you personally and feels connected to you, then they are exponentially more likely to fund your business. Listing a few hobbies, personal goals, and family references in your biography increases your likability and personal connection.

Smiling faces

Avoid including divisive issues such as political or religious references. Additionally, include a professional photograph of every member of your senior team and advisory board for your start-up.

Western readers will feel connected to pictures showing smiling faces. African readers, largely, feel that smiling professional photos come off as fake. So, a more serious facial expression is desirable if your intended audiences are Africans.

Unfortunately, most professionals subconsciously base a large portion of their funding preference on how you look physically. Recent research out of Harvard University shows that younger “attractive” looking men stand a much greater chance of receiving venture capital funding.

Why? Human beings erroneously connect physical attraction to mental abilities. Decades of studies show that primary school teachers predict that attractive pupils will perform better in examinations than plain students when shown pictures side by side.

Are psychological assumptions fair? Of course not. However, psychological suppositions represent the reality in which we live. So make sure you dress nicely for your business plan photo and show perhaps an action pose of you at work.

If you possess vast experience, start off with your current work, then move on to your past highlights, then hobbies, and only then on to your education background. If, on the other hand, you lack much experience, then start with your current venture, next your relevant volunteer activities and how you gain industry knowledge, then hobbies, and close with schooling.

Finally, if you have no experience at all, only then should you start your biography with your educational background.

Every professional needs a good concise biography. Business plans require biographies and your human resources assessment. Share your assessments at #KenyanExecutives on Twitter.

Prof Scott is the Director of the New Economy Venture Accelerator at USIU’s Chandaria School of Business.
www.ScottProfessor.com, info@scottprofessor.com, @ScottProfessor.