Business Planning: The Lean Startup Format

Though conventional wisdom says a traditional business plan is the vital first step when starting a business, more and more entrepreneurs are utilizing and finding success with the lean startup format.

Instead of elaborate planning, the lean startup format favors experimentation and allows you to explain or start your business quickly. This format works if your business is relatively simple or you expect you may want to adapt or refine your business plan as you go.

Value Proposition
Clearly describe the unique value you deliver to the customer. Which one of your customer's problems are you helping to solve? What products are services are you offering?

Key Partners
Describe the other businesses or services you’ll work with to run your business. Include your key partners, key suppliers and key resources your are acquiring from partners. What key activities will your partners perform?

Key Activities
Describe your competitive advantage. What key activities do your value propositions require? What distribution channels will you use? What will your customer relationships look like? What are your revenue streams? Focus on how you are unique: selling direct to consumers or using technology to tap into the sharing economy.

Key Resources
Describe the key resources your value propositions require. Important assets could include staff, capital or intellectual property.  What distribution channels will you use? What will your customer relationships look like? What are your revenue streams?

Customer Segments
Describe who you are creating value for. Who are your most important customers?

Customer Relationships
Describe what type of relationship each of your customer segments expects you to establish and maintain. Is it automated or personal? In person or online? How costly are the relationships? Consider the customer experience from start to finish.

Channels
Describe which channels your customer segments want to be reached through. How are you reaching them now? How are the channels integrated? Which ones are more effective and cost-efficient? How are you integrating them with customer routines?

Cost Structure
Describe the most important costs inherent in your business model. Which key resources and activities are most expensive? Will your company focus on reducing cost or maximizing value?

Revenue Streams
Describe how your company will actually make money. What your customers are really willing to pay? What are they paying for? How are they paying? How would they prefer to pay? How much does each revenue stream contribute to overall revenues?