
A strong business plan is most important when investing in start-ups - ph0rque
http://esciencenews.com/articles/2009/04/08/a.strong.business.plan.most.important.when.investing.start.ups
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pg
This is misleading. It's based on the earliest business plan they were able to
find, but that probably dates from the series A round.

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ph0rque
Yup:

> The first sample consisted of 50 start-ups that went public in an initial
> public offering for which there was a very early business plan. The second
> sample included all start-ups that went public in 2004.

They only sampled startups that went public... that's a very small sample of
all the startups.

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sr3d
On the same HN page, couple items a part is the link to the article "New
Research Finds Business Plans Are Virtually Useless: Advice to Entrepreneurs:
Perfect the Business, Not the Business Plan"
(<http://www.rhsmith.umd.edu/news/releases/2009/040809.aspx>).

This article said to have a larger sample size or 700 dot-com companies from
the late-1990s to early-2000s boom era. Is this an example of interpretation
of statistics?

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JeremyChase
Where is the data supporting this conclusion? This sounds like it was written
by someone theorizing about startups rather than someone living it.

I have always heard that people invest in the team. I think a poor product
with a good team has a better chance than a great product and a poor team. I
think this is because a good team will recognize that they have a poor
product, and will change it until it is good. Where a poor team may not even
realize they have a good product.

Jeremy

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payne92
Anyone have a link / pointer to the journal article?

It's a surprising conclusion (but hard to react without seeing the article).

My anecdotal experience: most successful startups change strategy & business
plans a few times. The ones that fail are the ones that cling to the original
plan in the face of changing assumptions.

My Fundamental Theory of Startups: "A startup is about staying in business
long enough to get to the third version of the idea."

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payne92
Found the original article here: [http://www3.interscience.wiley.com/cgi-
bin/fulltext/12166052...](http://www3.interscience.wiley.com/cgi-
bin/fulltext/121660523/PDFSTART)

