More From Forbes

13 common challenges when developing your first business.

  • Share to Facebook
  • Share to Twitter
  • Share to Linkedin

Starting a business, especially if you're unfamiliar with the process, can be daunting.  But while establishing a new business can feel overwhelming at first, there's comfort in knowing that you're not alone: Many other entrepreneurs have encountered similar challenges to what you're facing when they first started putting their business together, and have found their own ways forward.

To help you get started, 13 members of  Forbes Business Council , below, talk about the challenges people, including themselves, have faced when they began crafting their first business plan or start their first business, as well as share their advice for overcoming the hurdles.

Members discuss a few challenges people can face when creating their first business.

1. Building A Framework

The toughest challenge for me on the first business was getting my vision "on paper." I had such good ideas! So I built an outline using my "rule of three"—three core description points for the business, then three reasons why it was different, then three core reasons why it made sense to get into the business or invest. Below each of those reasons, list three supporting reasons, and so on. - Bruce Maxwell , MSI Management and Consulting Services, Inc

2. Having A Capital Financing Plan

A business plan that is reasonable and can be implemented involves many factors including management team, market assessment, competition, competitive differentiation and product development strategy. However, the biggest area that needs to be addressed is your capital financing plan. Ensure the financing, timing and source of funds is consistent with the needs to execute the plan. - David Crean , Objective Capital Partners, LLC

3. Being Concise

One of my biggest challenges was "how to keep it short and simple" when I have so much to say. I believe that the more concise and focused your plan is, the more likely for you to achieve your goals. In addition, having a realistic set of goals that align with your plan is a must! - Abigail Aboitiz , Advanced Remote Monitoring / ARM LLC

4. Overcoming Your Fear

For most people starting their first business, the biggest challenge seems to be fear. They plan out everything, they see the ideal market, but also lack the experience. So they often listen to friends and family who don't have their own business and know how risky it is. And then they get cold feet! If you are 70% sure, just go for it. It'll never be 100%, and by that time it's usually too late. - Mikey Wu , MIKOL

5. Being Ready To Pivot

A challenge we faced was not accounting for changes in the market, specifically consumer sentiment. When building technology, one needs to be flexible and adapt to customer needs. Luckily with the team we had, we were able to make on-the-fly adjustments to tackle the ever-changing landscape. - Kyle Mitnick , Advertise Purple

6. Setting The Right First Target

I built my first business plan alongside a number of other early-stage entrepreneurs with the initial objective of getting to $1 million in annual revenue. I built our business plan around getting to $5 million in revenue and so I built the foundation needed for a larger enterprise. As a result, I found getting past the $1 million threshold was much easier. - Kevin Bonfield , Concentre

7. Trying To Be Realistic

When anyone is starting a business they are going into it because they think it's going to be great, and they think they're going to be making a ton of money, and that clients will just rush through the doors. You've got to be realistic. You've got to think about everything that could go wrong and prepare. You don't want to end up in a hole because you haven't accounted for any potential hiccups. - Hoda Mahmoodzadegan , BAḴT Global

8. Getting People To Care

Before I founded my digital agency, I was an IT guy. My most-liked Facebook photo of 2016 was a picture of my wife, and it only got about 30 likes! Essentially, my biggest problem was getting people to care. At that point I started to get envious of entrepreneurs around me, but also observed what was working for them. Now, using social media as a marketing platform is what I do professionally! - Jeff J Hunter ,

9. Talking With The Right Mentor

There's much written that describes "the art of the start." However, oftentimes many of the authors haven't actually done what they have preached. Or if they have, they did it many years ago, making their experience irrelevant to today. It wouldn't make sense to ask Bill Gates how to raise an angel round. Find a mentor that's a little ahead of you to provide relevant, actionable help. - Derek Distenfield , GSD Venture Studios LLC

10. Accepting That You Don't Know Everything

We did not understand the details of how the insurance industry worked and what the real drivers and levers were for decision-making by the industry professionals. We immediately sought leading experts currently operating in the industry to become early advisors or angel investors. Additionally, I went out and got licensed in the industry to understand what the operators go through. - Vishaal Hariprasad ,

11. Determining The Customer Demand

The biggest challenge while developing our first business was to determine consumer demand. The right steps were to define the problem, run multiple market surveys, consolidate the results of both primary and secondary data, and then seize the opportunity. It’s very simple—if you cannot validate the need of your product through real data, your product will not reach the right customers. - Neha Kesarwani , Vertoe

12. Trying To Reeducate The Marketplace

Let the market place educate you. Every time I've tried to reeducate the marketplace, I've failed. No matter how cool or neat the product or idea was, it's just too expensive. The marketplace does the talking and you provide what it demands! - Skyler Ditchfield , GeoLinks

13. Embracing Integrative Thinking

The emotional attachment with one's entrepreneurial idea is a strength and a weakness. The strength enables one to put in sweat, blood and whatever it takes to create a successful enterprise. The weakness stems from not being able to see things from customers' and investors' perspectives. Falling in love with the problem allows one to explore different ways to a solution by soaking in those perspectives. - Karthik Krishnan , Britannica Group

  • Editorial Standards
  • Reprints & Permissions
  • Mobile Forms
  • See 100+ integrations


  • Jotform Teams NEW
  • Enterprise Mobile
  • Prefill Forms
  • HIPAA Forms
  • Secure Forms
  • Assign Forms
  • Online Payments
  • See more features
  • Multiple Users
  • Admin Console
  • White Labeling
  • Contact Sales
  • Help Center

Get a dedicated support team with Jotform Enterprise.

  • Sign Up for Free

The 5 toughest things entrepreneurs face when starting a business

How to Write a Business Plan

The 5 toughest things entrepreneurs face when starting a business

John Boitnott

Starting a new business is exciting, especially when you have an idea you know will help others. But having your own business is also stressful.

Even when you take all the right steps — selecting a business model, writing a detailed business plan to attract potential investors, leveraging social media to build a customer base, and focusing on cash flow — your small business may still struggle along the way.

Here are five of the biggest challenges new entrepreneurs face, even with extensive planning and determination. Don’t be afraid of these common challenges. Almost all successful entrepreneurs overcome them at some point, and you can too.

Use Jotform’s powerful online forms to collect payments, signups, and other types of data for your business.

Lack of support

A lack of support is one of the many challenges you may face when starting your own business. It can be tough when others don’t believe in your idea, your ability to succeed, or you as a founder in general.

Get a mentor or business adviser to build support when family, friends, and colleagues aren’t there for you. Even other young entrepreneurs can provide support because they may have experienced some of these challenges and found a way to move past them. Their advice and hard work can inspire you to keep going even when those closest to you may not support your vision.

Lack of money

No one likes going without money, but you may have to forego that regular paycheck or deal with no revenue until you can get to market with your product. It’s even worse when you don’t get the venture capital funding you thought it would be easy to tap into.

Focus on what you need to do to generate revenue. Keep a lean budget so you can stretch what you do have. Learning to operate a business with little money may help you stay judicial with your finances even when the revenue is rolling in.

Lack of confidence

It’s easy to succumb to self-doubt because of your own worries, criticism from others, or lack of support from friends and family. You may wonder whether you’ll be able to succeed. These feelings may also creep in when your target audience doesn’t respond as enthusiastically as you thought they would or if external factors slow your business growth.

To get past your lack of confidence , dig deep and focus on what you’ve achieved and how far you’ve come. Make a list of achievements; this may help you realize just how much you’ve already accomplished, including barriers you’ve overcome. It may also be helpful to consult with a business coach or mentor to talk you through this mental block.

Lack of a clear pathway

Despite having a clear vision, you may reach a point where you don’t know how to align your business goals with that picture. There’s also a chance that you’ll be hit with something unexpected and have to deal with problems that you didn’t think would ever happen to you.

Stay calm and address these issues as soon as you can. Focus on moving ahead. Look at your business plan to see where you are.

Reviewing your overall strategy, time line, and tactics may clarify that pathway. If not, it may be time to conduct more market research to determine if you need to take a different approach to moving your business forward.

Not having a clear pathway may mean a pivot is necessary, which is another reason to conduct more research.

Lack of experience and knowledge

Eventually you‘ll hit a point in the learning curve where you feel clueless. Maybe you don’t know how to create an effective marketing strategy or how to develop a new product. Maybe you lack experience making a budget, negotiating, hiring talent, or balancing the books.

You may feel lost, but what’s really happening is that you’re just early in the process. Take time to learn how to do the things you’ve never done before. Benchmark what others have done rather than reinventing the wheel.

For instance, look at what the competition has done with their social media or lead generation to see what worked and what didn’t. Doing this can give you much-needed experience while helping you avoid costly missteps.

Other ways to build your knowledge include taking online courses, attending a workshop, or participating in an industry conference. Some entrepreneurs watch every YouTube video they can find on a subject and learn that way. Work one-on-one with your team members, like your developers, to better understand what they do. You can absorb that information to make better decisions about investments, tactics, and roles.


How to Write a Business Plan

How to write a compelling business plan for a new market

When and how to make a lean business plan

When and how to make a lean business plan

Five examples of business goals and how to set them

Five examples of business goals and how to set them

How to do a competitive analysis in 7 steps

How to do a competitive analysis in 7 steps

How to write a business vision statement in 8 steps

How to write a business vision statement in 8 steps

How to build a COVID-19 business continuity plan

How to build a COVID-19 business continuity plan

How to prepare for the 4 stages of business life cycle

How to prepare for the 4 stages of business life cycle

How to develop action steps from your SWOT analysis

How to develop action steps from your SWOT analysis

How to write an effective executive summary

How to write an effective executive summary

10 best recession-proof business ideas

10 best recession-proof business ideas

5 types of organizational structures for entrepreneurs

5 types of organizational structures for entrepreneurs

Crafting a mini business plan for a crowdfunding campaign

Crafting a mini business plan for a crowdfunding campaign

Align your business plan with each stage of growth

Align your business plan with each stage of growth

How to plan for the 5 stages of small business growth

How to plan for the 5 stages of small business growth

5 tools that help with writing a business plan

5 tools that help with writing a business plan

How to tackle critical startup development issues

How to tackle critical startup development issues

How to write a business mission statement in 5 steps

How to write a business mission statement in 5 steps

The best business plan software to grow your business

The best business plan software to grow your business

Use your business plan to see if your business idea works

Use your business plan to see if your business idea works

Send Comment :


Trademarking Lawyers

When starting a business, deciding on a name can be difficult, Remember to ask friends, family, and even prospective customers for their thoughts and opinions. Getting several diverse viewpoints is always a good idea. Choosing a company name is merely the first step in creating a brand. Even while it'll provide your company a positive initial impression, it's up to you to live up to client expectations and make your company successful. Before you register your business, Consult with trademarking lawyers at the initial stage of your business if you want to grow it.

Hadijah Nabbona

Thanks for the help you offer to people about business enterprises

Jotform Logo

Thanks for verification!

Jotform Blog Newsletter

Guide to Creating a Business Plan With Template

Skye Schooley

To make your business idea a reality, you need a business plan. These simple business plan templates will get you started.

Having a road map helps you reach your journey’s end successfully. Business plans do the same for small businesses. They lay out the milestones you need to reach to build a profitable small business. They are also essential for identifying and overcoming obstacles along the way. Each part of a business plan helps you reach your goals, including the financial aspects, marketing, operations and sales.

Plenty of online business plan templates are available to take some of the pain out of the writing process. You may benefit from simple, easy-to-follow business plan tools so you spend less time writing and more time launching your venture.

What is a business plan?

With most great business ideas , the best way to execute them is to have a plan. A business plan is a written outline that you present to others, such as investors, whom you want to recruit into your venture. It’s your pitch to your investors, sharing with them what the goals of your startup are and how you expect to be profitable. 

It also serves as your company’s roadmap, keeping your business on track and ensuring your operations grow and evolve to meet the goals outlined in your plan. As circumstances change, a business plan can serve as a living document – but it should always include the core goals of your business.

Why do I need a business plan?

Starting a new business comes with headaches. Being prepared for those headaches can greatly decrease their impact on your business. One important step in preparing for the challenges your startup may face is writing a solid business plan.

Writing a business plan helps you understand more clearly what you need to do to reach your goals. The finished business plan also serves as a reminder to you of these goals. It’s a valuable tool that you can refer back to, helping you stay focused and on track.

What are the three main purposes of a business plan? 

Before you write your business plan, it’s important to understand the purpose of creating it in the first place. These are the three main reasons you should have a business plan:

Your business plan can be written as a document or designed as a slideshow, such as a PowerPoint presentation. It may be beneficial to create both versions. For example, the PowerPoint can be used to pull people in, and the document version that contains more detail can be given to viewers as a follow-up.

Free downloadable business plan template

Business News Daily put together a simple but high-value business plan template to help you create a business plan. The template is completely customizable and can be used to attract investors, secure board members, and narrow the scope of your company.

Business plans can be overwhelming to new entrepreneurs, but our template makes it easy to provide all of the details required by financial institutions and private investors. The template has eight main sections, with subsections for each topic. For easy navigation, a table of contents is provided with the template. As you customize each section, you’ll receive tips on how to correctly write the required details.

Here is our free business plan template you can use to craft a professional business plan quickly and easily.

Types of business plans

There are two main types of business plans: simple and traditional. Traditional business plans are long, detailed plans that expound on both short-term and long-term objectives. In comparison, a simple business plan focuses on a few key metrics in concise detail so as to quickly share data with investors.

Simple business plan

Business model expert Ash Maurya has developed a simple type of business plan called a lean canvas . The model, which was developed in 2010, is still one of the most popular types of business plans emulated today.

A lean canvas comprises nine sections, with each part of the plan containing high-value information and metrics to attract investors. This lean business plan often consists of a single page of information with the following listed:

Traditional business plan 

Traditional plans are lengthy documents, sometimes as long as 30 or 40 pages. A traditional business plan acts as a blueprint of a new business, detailing its progress from the time it launches to several years in the future when the startup is an established business. The following areas are covered in a traditional business plan:

We lay out each area of a traditional business plan in detail below.

1. Executive summary 

The executive summary is the most important section of your business plan, because it needs to draw your readers into your plan and entice them to continue reading. If your executive summary doesn’t capture the reader’s attention, they won’t read further, and their interest in your business won’t be piqued.

Even though the executive summary is the first section in your business plan, you should write it last. When you are ready to write this section, we recommend that you summarize the problem (or market need) you aim to solve, your solution for consumers, an overview of the founders and/or owners, and key financial details. The key with this section is to be brief yet engaging.

2. Company description 

This section is an overview of your entire business. Make sure you include basic information, such as when your company was founded, the type of business entity it is – limited liability company (LLC), sole proprietorship, partnership , C corporation or S corporation – and the state in which it is registered. Provide a summary of your company’s history to give the readers a solid understanding of its foundation. Learn more about articles of incorporation , and what you need to know to start a business.

3. Products and services 

Next, describe the products and/or services your business provides. Focus on your customers’ perspective – and needs – by demonstrating the problem you are trying to solve. The goal with this section is to prove that your business fills a bona fide market need and will remain viable for the foreseeable future.

4. Market analysis 

In this section, clearly define who your target audience is, where you will find customers, how you will reach them and, most importantly, how you will deliver your product or service to them. Provide a deep analysis of your ideal customer and how your business provides a solution for them. 

You should also include your competitors in this section, and illustrate how your business is uniquely different from the established companies in the industry or market. What are their strengths and weaknesses, and how will you differentiate yourself from the pack?

Follow this step-by-step guide on how to conduct a competitor analysis and what details it should include.

You will also need to write a marketing plan based on the context of your business. For example, if you’re a small local business, you want to analyze your competitors who are located nearby. Franchises need to conduct a large-scale analysis, potentially on a national level. Competitor data helps you know the current trends in your target industry and the growth potential. These details also prove to investors that you’re very familiar with the industry.

For this section, the listed target market paints a picture of what your ideal customer looks like. Data to include may be the age range, gender, income levels, location, marital status and geographical regions of target consumers.

A SWOT analysis is a common tool entrepreneurs use to bring all collected data together in a market analysis. “SWOT” stands for “strengths, weaknesses, opportunities and threats.” Strengths and weaknesses analyze the advantages and disadvantages unique to your company, while opportunities and threats analyze the current market risks and rewards.

5. Management team 

Before anyone invests in your business, they want a complete understanding of the potential investment. This section should illustrate how your business is organized. It should list key members of the management team, the founders/owners, board members, advisors, etc.

As you list each individual, provide a summary of their experience and their role within your company. Treat this section as a series of mini resumes, and consider appending full-length resumes to your business plan.

6. Financial plan 

The financial plan should include a detailed overview of your finances. At the very least, you should include cash flow statements, and profit and loss projections, over the next three to five years. You can also include historical financial data from the past few years, your sales forecast and balance sheet. Consider these items to include:

Make sure this section is precise and accurate. It’s often best to create this section with a professional accountant. If you’re seeking outside funding for your business , highlight why you’re seeking financing, how you will use that money, and when investors can expect a return on investment .

Struggling for cash flow? Here are eight cash flow strategies for survival.

If you really want to master your financial plan, Jennifer Spaziano, vice president of business development at Accion, offers these helpful tips:

7. Operational plan

The operational plan section details the physical needs of your business. This section discusses the location of the business , as well as required equipment or critical facilities needed to make your products. Some companies – depending on their business type – may also need to detail their inventory needs, including information about suppliers. For manufacturing companies, all processing details are spelled out in the operational plan section.

For startups, you want to divide the operational plan into two distinct phases: the developmental plan and the production plan. 

Free vs. paid business plan templates

You have your option of choosing between free and paid business templates. Both come with their own benefits and limitations, so the best one for you will depend on your specific needs and budget. Evaluating the pros and cons of each can help you decide.

Free templates

The biggest advantage of using a free template is the cost savings it offers to your business. Startups are often strapped for cash, making it a desirable choice for new business owners to access a free template. Although it’s nice to use templates at no cost, there are some drawbacks to free business plan templates – the biggest one being limited customizability.

“The process of writing a business plan lets you personally find the kinks in your business and work them out,” Attiyya Atkins, founder of A+ Editing, told Business News Daily. “Starting with an online template is a good start, but it needs to be reviewed and targeted to your market. Downloadable business plans may have dated market prices, making the budget inaccurate. If you’re looking to get money from investors, you need a customized business plan with zero errors.” 

Janil Jean, head of overseas operations at, agreed that free templates offer limited customization – such as the company name and some text. She added that they are often used by a ton of people, so if you use one to secure funds, investors might be tired of seeing that business plan format.

Paid templates

The benefit of paying for business plan templates – or paying for an expert to review your business plan – is the accuracy of information and high customization.

“Your audience gets thousands of applications per day. What’s to make your business plan stand out from the crowd when you’re not there in the room when they make the decisions about your enterprise?” Jean said. “Visuals are the best way to impress and get attention. It makes sense to get paid templates that allow you maximum customization through design, images and branding.”

On the contrary, the limitation to using a paid template is the cost. If your startup doesn’t have the funds to pay for a business plan template, it may not be a feasible option.

The best business plan software

In case you take the route of investing money in your business plan, there are several great software programs available. Software takes the legwork out of writing a business plan by simplifying the process and eliminating the need to start from scratch. They often include features like step-by-step wizards, templates, financial projection tools, charts and graphs, third-party application integrations, collaboration tools and video tutorials.

After researching and evaluating dozens of business plan software providers, we narrowed down these four of the best options available:

LivePlan is a cloud-hosted software application that provides many tools to create your business plan, including more than 500 templates, a one-page pitch builder, automatic financial statements, full financial forecasting , industry benchmark data and KPIs . Annual plans start at $15 per month.

Bizplan is cloud-hosted software that features a step-by-step builder to walk you through each section of the business plan. Annual plans start at $20.75 per month.

GoSmallBiz is a cloud-based service that offers industry-specific templates, a step-by-step wizard that makes creating a detailed business plan an easy one, and video tutorials. Monthly plans start at $15 per month.

Enloop focuses on financial projections. It provides you with everything you need to demonstrate how financially viable your business can be, and walks you through the process of generating financial forecasts. Annual plans start at $11 per month.

Common challenges of writing a business plan

The challenges of writing a business plan vary. Do you have all the information about your business that you need? Does your industry have strict guidelines that you must adhere to? To help you prepare, we identified 10 of the most common issues you may face:

Crafting a business plan around these 10 challenges can prepare your business – and anyone who joins it – for a prosperous future.

How to overcome the challenges of writing a business plan

Although you won’t accurately predict everything for your business, you can take preemptive steps to reduce the number of complications that may arise. For example, familiarize yourself with the business plan process by researching business plans and identifying how others successfully executed their plans.

You can use these plans as a basis; however, Rick Cottrell, CEO and founder of, recommends taking it one step further: Talk to small business owners and others who have experience.

“The business owner should talk to an accountant, banker, and those who deal with these plans on a daily basis and learn how others have done it,” Cottrell said. “They can join startup and investment groups, and speak to peers and others who are getting ready to launch a business, and gain insights from them. They can seek out capital innovation clubs in their area and get additional expertise.”

If you research how to write a business plan and still don’t feel comfortable writing one, you can always hire a consultant to help you with the process.

“It is simply a time-consuming process that cannot be rushed,” Cottrell added. “Millions of dollars can be at stake and, in many cases, requires a high level of expertise that either needs to be learned or executed in conjunction with an experienced business consultant.” 

Sean Peek, Jennifer Post, Chad Brooks, Howard Wen and Joshua Stowers contributed to the writing and reporting in this article. Source interviews were conducted for a previous version of this article and related articles.

challenges faced by entrepreneurs in drawing up a business plan pdf

Do You Really Need a Business Plan?

The art of storytelling, from net margin to sales.

Do You Really Need a Business Plan?

Why is a business plan important?

Four Reasons to Write a Business Plan

1. To raise money for your business

2. To make sound decisions

3. To help you identify any potential weaknesses

4. To communicate your ideas with stakeholders

Rich Longo

More by this contributor:

Comments (0)

You may like.

How to Write a Business Plan for Your Small Business

How to Write a Business Plan for Your Small Business

This device is too small

If you're on a Galaxy Fold, consider unfolding your phone or viewing it in full screen to best optimize your experience.


8 Common Challenges Entrepreneurs Face (and How to Overcome Them)

by DP Taylor | Updated Aug. 5, 2022 - First published on May 18, 2022

Image source: Getty Images

The challenges of starting a business are well-known. You wouldn't be here if you didn't wonder what you're in for as you contemplate launching the next app or developing a new beverage.

Entrepreneurial issues are many and varied, and they're unlike any you'll find as an employee in a business. So review entrepreneur challenges first before starting a business, and you'll avoid making common rookie mistakes.

Whether you’re embarking on solopreneurship, infopreneurship, or becoming the next Steve Jobs, you will face adversity along the way. If you’ve decided to work for yourself , here are eight entrepreneurial problems you’re almost certain to face and how to handle each of them.

1. Deciding what to sell

Probably the biggest challenge of entrepreneurship is figuring out what kind of product or service to offer. It’s not an easy question because getting it wrong means your business will fail no matter how well-designed and set up it is.

Entrepreneurs must understand the customer who is likely to purchase their product, what market they are seeking to serve, what the competition looks like, what they could offer to give themselves a competitive advantage, if their target market is large enough to support the product, if their target market is too broad, and a host of other issues.

How to overcome it: Self-assess and research

There’s only one way to deal with this challenge: diligent research. You must come up with a detailed business plan that you can defend to any potential investor or partner. Your research should describe your target market in great detail and offer realistic plans for how you will become profitable -- not pie-in-the-sky predictions based on nothing more than hope.

You also have to assess yourself to determine if you have the energy to pursue this idea to fruition and whether you have the right skills and strengths for the job.

2. Marketing

To paraphrase sales guru Grant Cardone, if people don’t know you, they can't buy from you -- not won't buy from you but can't buy from you. Marketing introduces you and your brand to customers so it is possible for them to even consider buying your product and service.

But marketing is a challenge for entrepreneurs because oftentimes they’re strapped for cash, and building a brand through marketing can be expensive with no immediate benefit early on. You’ve got to decide how to market your product or service -- choose from mobile, social media, or print -- and determine whether it’s wise to work with outside agencies.

How to overcome it: Test and examine

When you’re starting out lean, you must figure out where your marketing money will get the most bang for the buck. Start small with free social media platforms and try out a few different approaches.

Consider broad, more capital-intensive approaches based on some of the results you see. Always start with a small marketing effort and collect extensive data and business metrics on various approaches before jumping in with both feet.

3. Hiring talent

Entrepreneurs who want to expand must find help. At a certain point, you can’t do it all on your own. But finding the right people is a big challenge, especially early on before you have your own human resources department and processes.

You must learn how to identify what type of people you need, how to evaluate them, and how to integrate them into your business so they are vital parts of your organization rather than “gofers” who need constant direction. You must invest time in reviewing credentials and candidates, or employees may actually hinder success.

How to overcome it: Narrow your focus

Develop a specific description of the role you’re hiring for and a detailed breakdown of what skills and personality attributes you need for the position. Then start vetting applicants, checking each box to see how many of these attributes they meet so you can compare them later. Considering using outside headhunters to take over the process.

4. Delegating authority

It’s not good enough to hire a bunch of people -- you must properly delegate work and responsibility to them. As an entrepreneur, the temptation is to try to do everything yourself, but this is not productive and will limit your company’s growth. Strike a balance between monitoring the business and trusting others to accomplish objectives.

How to overcome it: Learn to trust

Give your employees clear roles and responsibilities, as well as rewards for meeting certain benchmarks. Make them stakeholders in your company’s success. Avoid micromanaging people and processes. Give people the space to use their talents and only step in for minor course corrections. Be patient with others -- and with yourself.

5. Managing time

While it may seem like money is constantly in short supply, time is the only thing that will always be limited. Entrepreneurs must make sure their time is spent on the most important tasks, and they must avoid spending time on tasks team members can do. By freeing up this time, they can focus on the bigger-picture issues, such as how to take the company in a direction for growth.

How to overcome it: Be organized and delegate

Identify tasks that can be delegated and then delegate them. Resist the urge to do them yourself because you know you could do it perfectly. Trust your team members -- they will surprise you with how much they can get done and how well they can do it. Focus on your own strengths and let others handle everything else.

6. Guarding cash flow

Cash is always running for entrepreneurs, so you must guard it carefully. It’s a challenge to ensure revenue is consistent and can always cover costs and payroll. The last thing you want to do is start paying employees late because you didn’t plan cash flow properly, which can have ripple effects on the morale of your staff and their trust in your company and leadership.

How to overcome it: Budget and plan

Entrepreneurs need an effective billing system in place and good record-keeping, which is where accounting software can save the day. This software can account for all costs and help entrepreneurs promptly invoice for service and products. Consider working with an accounting professional if you need extra help in this area -- it’s that important.

7. Finding capital

Before they even get to worry about cash flow issues, an entrepreneur needs capital to get off the ground. This is one of the most significant problems faced by entrepreneurs, particularly those striking out on their own who aren’t well-connected to angel investors with deep pockets.

Without enough financial resources to start your business, it will be doomed to fail. You will need capital for space, equipment, or to develop and produce your product.

How to overcome it: Be resourceful and aggressive

Just like you must be a good salesman to get customers to buy your product, you must also market yourself and your company to potential investors. Consult with banks and investors in your area, or look to public platforms like Kickstarter. Consider approaching family, friends, and associates seeking investment or for connections to someone who might be willing to invest.

A word of caution on taking money from friends and family, however: That money will affect your relationship if things go south, so be very careful before taking this route.

8. Projecting confidence

Becoming an entrepreneur seems fun and exciting, and sometimes it is. But most of the time -- particularly early on -- you’re constantly battling self-doubt. Do you have the confidence it takes to be an entrepreneur ? Are you able to shake off feelings of the imposter syndrome?

Unless you are brimming with confidence and have the spirit to fight through adversity -- because you will face significant obstacles you can’t foresee -- you will struggle as an entrepreneur and will likely quit.

How to overcome it: Believe in your skills and vision

One way to deal with imposter syndrome is to remind yourself that, even when you’re failing, that’s never true. You have skills that are valuable, and your persistence and hard work is admirable and something most people aren’t even brave enough to attempt.

Seek support and advice from other entrepreneurs to get you through the tough times. And don’t completely bat away feelings of doubt. Sometimes they open your eyes to problems that you need to fix, so be honest with yourself and willing to learn from setbacks.

Before you jump in, you need a gut check

Are you excited about entrepreneurship? That’s a good attitude to have. But approaching it like a get-rich-quick scheme with no real interest in the venture itself will result in you flaming out almost immediately.

You must take entrepreneurship very seriously. There is a lot of risk, and the failure rate is high. An entrepreneurial mindset is not enough -- one thing that millionaires and billionaires don't often reveal in their books is how much money they started out with, what kind of connections they or their family had, or other advantages that you probably don't have.

Don’t be fooled by those who suggest the only thing stopping you from overnight success is ambition. Most entrepreneurs either throw in the towel after a short time, or they spend years or even decades slowly building their business.

If you want to be one of the latter, first ask yourself whether you have the stamina to work nights and weekends while you keep your day job to support yourself and your family. Is that a lifestyle you could handle? How badly do you want this?

Once you answer that, the path forward becomes a lot clearer.

Alert: highest cash back card we've seen now has 0% intro APR until 2024

If you're using the wrong credit or debit card, it could be costing you serious money. Our experts love this top pick , which features a 0% intro APR until 2024, an insane cash back rate of up to 5%, and all somehow for no annual fee. 

In fact, this card is so good that our experts even use it personally. Click here to read our full review for free and apply in just 2 minutes. 

Read our free review

Our Research Expert

DP Taylor

DP Taylor is a business software expert writing for The Ascent and The Motley Fool.

We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.

The Ascent Logo

The Ascent is a Motley Fool service that rates and reviews essential products for your everyday money matters.

Copyright © 2018 - 2023 The Ascent. All rights reserved.

Learning Objectives

By the end of this section, you will be able to:

Unlike the brief or lean formats introduced so far, the business plan is a formal document used for the long-range planning of a company’s operation. It typically includes background information, financial information, and a summary of the business. Investors nearly always request a formal business plan because it is an integral part of their evaluation of whether to invest in a company. Although nothing in business is permanent, a business plan typically has components that are more “set in stone” than a business model canvas , which is more commonly used as a first step in the planning process and throughout the early stages of a nascent business. A business plan is likely to describe the business and industry, market strategies, sales potential, and competitive analysis, as well as the company’s long-term goals and objectives. An in-depth formal business plan would follow at later stages after various iterations to business model canvases. The business plan usually projects financial data over a three-year period and is typically required by banks or other investors to secure funding. The business plan is a roadmap for the company to follow over multiple years.

Some entrepreneurs prefer to use the canvas process instead of the business plan, whereas others use a shorter version of the business plan, submitting it to investors after several iterations. There are also entrepreneurs who use the business plan earlier in the entrepreneurial process, either preceding or concurrently with a canvas. For instance, Chris Guillebeau has a one-page business plan template in his book The $100 Startup . 48 His version is basically an extension of a napkin sketch without the detail of a full business plan. As you progress, you can also consider a brief business plan (about two pages)—if you want to support a rapid business launch—and/or a standard business plan.

As with many aspects of entrepreneurship, there are no clear hard and fast rules to achieving entrepreneurial success. You may encounter different people who want different things (canvas, summary, full business plan), and you also have flexibility in following whatever tool works best for you. Like the canvas, the various versions of the business plan are tools that will aid you in your entrepreneurial endeavor.

Business Plan Overview

Most business plans have several distinct sections ( Figure 11.16 ). The business plan can range from a few pages to twenty-five pages or more, depending on the purpose and the intended audience. For our discussion, we’ll describe a brief business plan and a standard business plan. If you are able to successfully design a business model canvas, then you will have the structure for developing a clear business plan that you can submit for financial consideration.

Business plan that includes an executive summary, business description, market strategies, marketing plan, competitive analysis, operations and management plan, financial analysis, and design and development plan.

Both types of business plans aim at providing a picture and roadmap to follow from conception to creation. If you opt for the brief business plan, you will focus primarily on articulating a big-picture overview of your business concept.

The full business plan is aimed at executing the vision concept, dealing with the proverbial devil in the details. Developing a full business plan will assist those of you who need a more detailed and structured roadmap, or those of you with little to no background in business. The business planning process includes the business model, a feasibility analysis, and a full business plan, which we will discuss later in this section. Next, we explore how a business plan can meet several different needs.

Purposes of a Business Plan

A business plan can serve many different purposes—some internal, others external. As we discussed previously, you can use a business plan as an internal early planning device, an extension of a napkin sketch, and as a follow-up to one of the canvas tools. A business plan can be an organizational roadmap , that is, an internal planning tool and working plan that you can apply to your business in order to reach your desired goals over the course of several years. The business plan should be written by the owners of the venture, since it forces a firsthand examination of the business operations and allows them to focus on areas that need improvement.

Refer to the business venture throughout the document. Generally speaking, a business plan should not be written in the first person.

A major external purpose for the business plan is as an investment tool that outlines financial projections, becoming a document designed to attract investors. In many instances, a business plan can complement a formal investor’s pitch. In this context, the business plan is a presentation plan, intended for an outside audience that may or may not be familiar with your industry, your business, and your competitors.

You can also use your business plan as a contingency plan by outlining some “what-if” scenarios and exploring how you might respond if these scenarios unfold. Pretty Young Professional launched in November 2010 as an online resource to guide an emerging generation of female leaders. The site focused on recent female college graduates and current students searching for professional roles and those in their first professional roles. It was founded by four friends who were coworkers at the global consultancy firm McKinsey. But after positions and equity were decided among them, fundamental differences of opinion about the direction of the business emerged between two factions, according to the cofounder and former CEO Kathryn Minshew . “I think, naively, we assumed that if we kicked the can down the road on some of those things, we’d be able to sort them out,” Minshew said. Minshew went on to found a different professional site, The Muse , and took much of the editorial team of Pretty Young Professional with her. 49 Whereas greater planning potentially could have prevented the early demise of Pretty Young Professional, a change in planning led to overnight success for Joshua Esnard and The Cut Buddy team. Esnard invented and patented the plastic hair template that he was selling online out of his Fort Lauderdale garage while working a full-time job at Broward College and running a side business. Esnard had hundreds of boxes of Cut Buddies sitting in his home when he changed his marketing plan to enlist companies specializing in making videos go viral. It worked so well that a promotional video for the product garnered 8 million views in hours. The Cut Buddy sold over 4,000 products in a few hours when Esnard only had hundreds remaining. Demand greatly exceeded his supply, so Esnard had to scramble to increase manufacturing and offered customers two-for-one deals to make up for delays. This led to selling 55,000 units, generating $700,000 in sales in 2017. 50 After appearing on Shark Tank and landing a deal with Daymond John that gave the “shark” a 20-percent equity stake in return for $300,000, The Cut Buddy has added new distribution channels to include retail sales along with online commerce. Changing one aspect of a business plan—the marketing plan—yielded success for The Cut Buddy.

Link to Learning

Watch this video of Cut Buddy’s founder, Joshua Esnard, telling his company’s story to learn more.

If you opt for the brief business plan, you will focus primarily on articulating a big-picture overview of your business concept. This version is used to interest potential investors, employees, and other stakeholders, and will include a financial summary “box,” but it must have a disclaimer, and the founder/entrepreneur may need to have the people who receive it sign a nondisclosure agreement (NDA) . The full business plan is aimed at executing the vision concept, providing supporting details, and would be required by financial institutions and others as they formally become stakeholders in the venture. Both are aimed at providing a picture and roadmap to go from conception to creation.

Types of Business Plans

The brief business plan is similar to an extended executive summary from the full business plan. This concise document provides a broad overview of your entrepreneurial concept, your team members, how and why you will execute on your plans, and why you are the ones to do so. You can think of a brief business plan as a scene setter or—since we began this chapter with a film reference—as a trailer to the full movie. The brief business plan is the commercial equivalent to a trailer for Field of Dreams , whereas the full plan is the full-length movie equivalent.

Brief Business Plan or Executive Summary

As the name implies, the brief business plan or executive summary summarizes key elements of the entire business plan, such as the business concept, financial features, and current business position. The executive summary version of the business plan is your opportunity to broadly articulate the overall concept and vision of the company for yourself, for prospective investors, and for current and future employees.

A typical executive summary is generally no longer than a page, but because the brief business plan is essentially an extended executive summary, the executive summary section is vital. This is the “ask” to an investor. You should begin by clearly stating what you are asking for in the summary.

In the business concept phase, you’ll describe the business, its product, and its markets. Describe the customer segment it serves and why your company will hold a competitive advantage. This section may align roughly with the customer segments and value-proposition segments of a canvas.

Next, highlight the important financial features, including sales, profits, cash flows, and return on investment. Like the financial portion of a feasibility analysis, the financial analysis component of a business plan may typically include items like a twelve-month profit and loss projection, a three- or four-year profit and loss projection, a cash-flow projection, a projected balance sheet, and a breakeven calculation. You can explore a feasibility study and financial projections in more depth in the formal business plan. Here, you want to focus on the big picture of your numbers and what they mean.

The current business position section can furnish relevant information about you and your team members and the company at large. This is your opportunity to tell the story of how you formed the company, to describe its legal status (form of operation), and to list the principal players. In one part of the extended executive summary, you can cover your reasons for starting the business: Here is an opportunity to clearly define the needs you think you can meet and perhaps get into the pains and gains of customers. You also can provide a summary of the overall strategic direction in which you intend to take the company. Describe the company’s mission, vision, goals and objectives, overall business model, and value proposition.

Rice University’s Student Business Plan Competition, one of the largest and overall best-regarded graduate school business-plan competitions (see Telling Your Entrepreneurial Story and Pitching the Idea ), requires an executive summary of up to five pages to apply. 51 , 52 Its suggested sections are shown in Table 11.2 .

Are You Ready?

Create a brief business plan.

Fill out a canvas of your choosing for a well-known startup: Uber, Netflix, Dropbox, Etsy, Airbnb, Bird/Lime, Warby Parker, or any of the companies featured throughout this chapter or one of your choice. Then create a brief business plan for that business. See if you can find a version of the company’s actual executive summary, business plan, or canvas. Compare and contrast your vision with what the company has articulated.

Full Business Plan

Even full business plans can vary in length, scale, and scope. Rice University sets a ten-page cap on business plans submitted for the full competition. The IndUS Entrepreneurs , one of the largest global networks of entrepreneurs, also holds business plan competitions for students through its Tie Young Entrepreneurs program. In contrast, business plans submitted for that competition can usually be up to twenty-five pages. These are just two examples. Some components may differ slightly; common elements are typically found in a formal business plan outline. The next section will provide sample components of a full business plan for a fictional business.

Executive Summary

The executive summary should provide an overview of your business with key points and issues. Because the summary is intended to summarize the entire document, it is most helpful to write this section last, even though it comes first in sequence. The writing in this section should be especially concise. Readers should be able to understand your needs and capabilities at first glance. The section should tell the reader what you want and your “ask” should be explicitly stated in the summary.

Describe your business, its product or service, and the intended customers. Explain what will be sold, who it will be sold to, and what competitive advantages the business has. Table 11.3 shows a sample executive summary for the fictional company La Vida Lola.

Business Description

This section describes the industry, your product, and the business and success factors. It should provide a current outlook as well as future trends and developments. You also should address your company’s mission, vision, goals, and objectives. Summarize your overall strategic direction, your reasons for starting the business, a description of your products and services, your business model, and your company’s value proposition. Consider including the Standard Industrial Classification/North American Industry Classification System (SIC/NAICS) code to specify the industry and insure correct identification. The industry extends beyond where the business is located and operates, and should include national and global dynamics. Table 11.4 shows a sample business description for La Vida Lola.

Industry Analysis and Market Strategies

Here you should define your market in terms of size, structure, growth prospects, trends, and sales potential. You’ll want to include your TAM and forecast the SAM . (Both these terms are discussed in Conducting a Feasibility Analysis .) This is a place to address market segmentation strategies by geography, customer attributes, or product orientation. Describe your positioning relative to your competitors’ in terms of pricing, distribution, promotion plan, and sales potential. Table 11.5 shows an example industry analysis and market strategy for La Vida Lola.

Competitive Analysis

The competitive analysis is a statement of the business strategy as it relates to the competition. You want to be able to identify who are your major competitors and assess what are their market shares, markets served, strategies employed, and expected response to entry? You likely want to conduct a classic SWOT analysis (Strengths Weaknesses Opportunities Threats) and complete a competitive-strength grid or competitive matrix. Outline your company’s competitive strengths relative to those of the competition in regard to product, distribution, pricing, promotion, and advertising. What are your company’s competitive advantages and their likely impacts on its success? The key is to construct it properly for the relevant features/benefits (by weight, according to customers) and how the startup compares to incumbents. The competitive matrix should show clearly how and why the startup has a clear (if not currently measurable) competitive advantage. Some common features in the example include price, benefits, quality, type of features, locations, and distribution/sales. Sample templates are shown in Figure 11.17 and Figure 11.18 . A competitive analysis helps you create a marketing strategy that will identify assets or skills that your competitors are lacking so you can plan to fill those gaps, giving you a distinct competitive advantage. When creating a competitor analysis, it is important to focus on the key features and elements that matter to customers, rather than focusing too heavily on the entrepreneur’s idea and desires.

Competitor analysis comparing five different restaurants by price, location, quality, and food type. La Vida Lola sells Latin food of mid to high quality at a variety of locations for between six and 13 dollars. Mix’D Up Burgers sells American food/burgers of low quality at both rotating and Smyrna locations for around ten dollars. Mac the Cheese sells American comfort food of mid quality at rotating locations for between ten and thirteen dollars. The Fry Guy sells American food of high quality in Buckhead for at minimum thirteen dollars. The Blaxican sells soul/Mexican fusion food of high quality in Midtown at high prices.

Operations and Management Plan

In this section, outline how you will manage your company. Describe its organizational structure. Here you can address the form of ownership and, if warranted, include an organizational chart/structure. Highlight the backgrounds, experiences, qualifications, areas of expertise, and roles of members of the management team. This is also the place to mention any other stakeholders, such as a board of directors or advisory board(s), and their relevant relationship to the founder, experience and value to help make the venture successful, and professional service firms providing management support, such as accounting services and legal counsel.

Table 11.6 shows a sample operations and management plan for La Vida Lola.

Marketing Plan

Here you should outline and describe an effective overall marketing strategy for your venture, providing details regarding pricing, promotion, advertising, distribution, media usage, public relations, and a digital presence. Fully describe your sales management plan and the composition of your sales force, along with a comprehensive and detailed budget for the marketing plan. Table 11.7 shows a sample marketing plan for La Vida Lola.

Financial Plan

A financial plan seeks to forecast revenue and expenses; project a financial narrative; and estimate project costs, valuations, and cash flow projections. This section should present an accurate, realistic, and achievable financial plan for your venture (see Entrepreneurial Finance and Accounting for detailed discussions about conducting these projections). Include sales forecasts and income projections, pro forma financial statements ( Building the Entrepreneurial Dream Team , a breakeven analysis, and a capital budget. Identify your possible sources of financing (discussed in Conducting a Feasibility Analysis ). Figure 11.19 shows a template of cash-flow needs for La Vida Lola.

Cash flow template that tracks income for every day of the week and expenses. Fixed monthly expenses include facility rental, personal loans, insurance, credit cards, Farmer’s Market overheads, planned savings, and other. Variable monthly expenses include food/beverages, utilities (electricity, gas), uniforms, wages, fuel (vehicle), medical expenses, and other. Fixed infrequent expenses included insurance, annual subscriptions, property rates/taxes, union fees, education, and other. Variable infrequent expenses include gifts, holidays, vehicle repairs and registration, durable goods purchase, donations, and other. The difference between total income and total expenses is the income available.

Entrepreneur In Action

Laughing man coffee.

Hugh Jackman ( Figure 11.20 ) may best be known for portraying a comic-book superhero who used his mutant abilities to protect the world from villains. But the Wolverine actor is also working to make the planet a better place for real, not through adamantium claws but through social entrepreneurship.

Photo of Hugh Jackman.

A love of java jolted Jackman into action in 2009, when he traveled to Ethiopia with a Christian humanitarian group to shoot a documentary about the impact of fair-trade certification on coffee growers there. He decided to launch a business and follow in the footsteps of the late Paul Newman, another famous actor turned philanthropist via food ventures.

Jackman launched Laughing Man Coffee two years later; he sold the line to Keurig in 2015. One Laughing Man Coffee café in New York continues to operate independently, investing its proceeds into charitable programs that support better housing, health, and educational initiatives within fair-trade farming communities. 55 Although the New York location is the only café, the coffee brand is still distributed, with Keurig donating an undisclosed portion of Laughing Man proceeds to those causes (whereas Jackman donates all his profits). The company initially donated its profits to World Vision, the Christian humanitarian group Jackman accompanied in 2009. In 2017, it created the Laughing Man Foundation to be more active with its money management and distribution.

What Can You Do?

Textbooks for change.

Founded in 2014, Textbooks for Change uses a cross-compensation model, in which one customer segment pays for a product or service, and the profit from that revenue is used to provide the same product or service to another, underserved segment. Textbooks for Change partners with student organizations to collect used college textbooks, some of which are re-sold while others are donated to students in need at underserved universities across the globe. The organization has reused or recycled 250,000 textbooks, providing 220,000 students with access through seven campus partners in East Africa. This B-corp social enterprise tackles a problem and offers a solution that is directly relevant to college students like yourself. Have you observed a problem on your college campus or other campuses that is not being served properly? Could it result in a social enterprise?

Work It Out

Franchisee set out.

A franchisee of East Coast Wings, a chain with dozens of restaurants in the United States, has decided to part ways with the chain. The new store will feature the same basic sports-bar-and-restaurant concept and serve the same basic foods: chicken wings, burgers, sandwiches, and the like. The new restaurant can’t rely on the same distributors and suppliers. A new business plan is needed.

This New York Times video, “An Unlikely Business Plan,” describes entrepreneurial resurgence in Detroit, Michigan.

As an Amazon Associate we earn from qualifying purchases.

Want to cite, share, or modify this book? This book uses the Creative Commons Attribution License and you must attribute OpenStax.

Access for free at

© Dec 12, 2022 OpenStax. Textbook content produced by OpenStax is licensed under a Creative Commons Attribution License . The OpenStax name, OpenStax logo, OpenStax book covers, OpenStax CNX name, and OpenStax CNX logo are not subject to the Creative Commons license and may not be reproduced without the prior and express written consent of Rice University.


  1. Challenges Faced by Entrepreneurs

    challenges faced by entrepreneurs in drawing up a business plan pdf

  2. Marketing Challenges Faced by Entrepreneurs

    challenges faced by entrepreneurs in drawing up a business plan pdf

  3. The Top 15 Common Challenges Faced by Entrepreneurs

    challenges faced by entrepreneurs in drawing up a business plan pdf

  4. Challenges Faced By Female Entrepreneurs In Starting A Business

    challenges faced by entrepreneurs in drawing up a business plan pdf

  5. To Become A Successful Entrepreneur.

    challenges faced by entrepreneurs in drawing up a business plan pdf

  6. 10 Major Problems Faced By Entrepreneurs in India While Starting a Business

    challenges faced by entrepreneurs in drawing up a business plan pdf


  1. Planning to be an Entrepreneur

  2. Kelompok 5 kelas 15: Ide & Peluang Bisnis Baru



  5. How To Write A Business Plan In 2021 (STEP BY STEP)

  6. 💼 Want to overcome obstacles in your business?


  1. 13 Common Challenges When Developing Your First Business

    1. Building A Framework · 2. Having A Capital Financing Plan · 3. Being Concise · 4. Overcoming Your Fear · 5. Being Ready To Pivot · 6. Setting The

  2. 5 big challenges when writing a business plan & how to overcome

    The Paint Along Lady · 1. Actually starting it · 2. Filling out your financials · 3. Knowing your demographics · 4. Planning for technical changes.

  3. Writing a Business Plan

    Existing businesses will rely heavily on past performance as an indicator of the future. Start-ups have a greater challenge - they will rely more on market

  4. The Elements of a Business Plan: First Steps for New Entrepreneurs

    and elements required to write a business plan for a new venture ... the company to taking an interest in broader social issues. Thus, the firm's values are

  5. The 5 toughest things entrepreneurs face when starting a business

    A lack of support is one of the many challenges you may face when starting your own business. It can be tough when others don't believe in your

  6. The Business Plan

    The drawing up, using and updating of a business plan is clarified with know-how but easy language to founders of new businesses and man- aging directors of mid

  7. How to Write a Business Plan

    Problem; Solution; Key metrics; Unique proposition; Unfair advantage; Channels; Customer targets; Cost structures; Revenue streams. Traditional

  8. Do You Really Need a Business Plan?

    Of course, not everyone agrees with that. A large number of business funding experts support the idea that having a good business plan is not enough. Even

  9. How to Overcome Common Challenges Faced by Entrepreneurs

    8 Common Challenges Entrepreneurs Face (and How to Overcome Them) · 1. Deciding what to sell. Probably the biggest challenge of entrepreneurship

  10. 11.4 The Business Plan

    For instance, Chris Guillebeau has a one-page business plan template in his book The $100 Startup. His version is basically an extension of