business plan

12 Replies

I was wondering if I should have a business plan or not? If yes, could someone explain why? 

What are your goals?   Real Estate?  Personal?  Financial?

Write down a 1 year, 5, 10 etc.....

I dont really have a business plan, just goals.   Which are targets I am aiming for that I don't always hit.    

Write down what you want and then go for it.    

What is your objective in Real Estate?   

to buy and hold. I'm trying to come up with some capital. 

What are your goals?

What is your detailed plan to achieve those goals?

What do you need to accomplish those goals?

How will you get those things you need?

What are the risks?

How will you mitigate those risks?

As long as you know the answers to those questions inside and out, you don't need a business plan.  That said, most people don't know the answers to those questions and that's the purpose of a business plan.

Originally posted by @Obdia Whitmore :

to buy and hold. I'm trying to come up with some capital. 

 I would say if you are trying to come up with some capital a business plan is essential.

A good BP Podcast that hits on it is #58 with Justin Silverio.

Manny

I have a business plan but it is very causual in my head. I built it this way.

Goal: Mine was early retirement living off the cash flow of the houses in 15 years

Type: Buy and Hold

Than from there we have looked at every opportunity and addressed "subconsciously" how that will get us to our end goal.

We started out buying a primary and than renting it out when we were trasnfered (active duty navy). At the same time we were living frugally on one income investing the second and from there we babysteped it into our current model.

High "class" lower income but lower expenses within the tight margins. Self-manage from afar to keep tight control AND reduce expenses.

Some people don't need to "put to pen" their plans.  Others benefit greatly from it.

I'm a "plan your work and work your plan" kind of person.  Without our very detailed personal 5 year plan and business plan, I would feel very lost.   I like to know what we're working towards.  Our 5 year plan is broken down by months with "to do" goals and "financial" goals.  When we meet or exceed them, it just gives us one more thing to celebrate.

From a strictly business point of view, the potential partners we've shared our business plan with were impressed. I think it shows our seriousness and dedication to our REI ventures, and we had more "buy in" from a partnership point of view. Likewise, had our current partner not had his own business plan, we may have been less inclined to fork over tens of thousands of dollars to work with him ;)

Heather,

I am looking to develop a business plan to gain a few partners.  I think that a business plan makes thing far more professional.  I'd like to show them the marketing budget which is the major part of obtaining deals then the strategy will go in accordance to whatever the deal dictates whether its a buy and hold or flip or listing for our agent....  I would really like to see your plan but if its really personal I understand.

I would recommend setting up definitive mission statement and create goals (everyday, every week, every month, every year, next 5 years, etc) that will align with that mission.

Although this is an over a year post originated by @Obdia Whitmore , I really do not have the conventional business plan. I share the views of  @Elizabeth Colegrove , @Heather Jones , @J Scott and the views of Grant Cardone >

Here's an extraction of the transcript about what Grant Cardone has to say about business plan.
@biggerpockets Podcast 108 http://bit.ly/1zzzXRE


Grant: Look, I got an accounting degree. It was one of the better business degrees you could get when I went to college and I didn’t want to get just a business degree so I was like, I’m going to get an accounting degree. I own four businesses. We do almost $100 million a year in sales here. I’ve never even written a business plan.
All I know is how to produce revenue. I’m like, produce revenue, span, grow revenue. I built a software business, I didn’t know anything about software. You build a piece of software, you’ve got to sell it. Somebody’s got to sell the software. It doesn’t matter how good it is, there’s probably better software. But you’ve still got to sell it so Mark Cuban says, the first thing that everybody needs to learn if they want to start their own business is how to sell the product or the service or the concept or raise money. One of the four.
Josh: Hey Grant, what do you say to those guys who say that you need to have the business plan because that’s a big thing, right? You’ve got to have the plan and you’ve got to map it out. You say you’ve got to sell, you’ve got to be able to market and produce. What do you tell those guys?

Grant: I think everybody’s business plan is a great idea if it gives you comfort. It’s kind of like a condom, you know. Most people take it off. I mean, really. Come on. You can get a business plan if you want, pay $800 to build one if you want to go spend time and energy getting a business plan, 90% of the stuff that’s going to happen to you will not be in that business plan. The storm that New York got hit with last night – not in the business plan. ISIS, not in the business plan. Disruption of technologies, not in the business plan. You cannot think about everything that’s in the business plan so while you’re writing your business plan, I’m going out into the marketplace and I’m building customers whether it’s in real estate or whether I’m selling a book.

Here's a tweetable quote:
"While you are writing your business plan, I'm in the marketplace building customers." @biggerpockets Podcast 108 http://bit.ly/1zzzXRE

@Obdia Whitmore

Hi Obdia

A business plan outlines your goals, strategies and mission for investing.  You should at least have one for yourself and then develop one for bankers, brokers, partners, etc.

I have created a credibility book course on Udemy that teaches how to build a solid business plan

All the best

Gino

Originally posted by @J Scott :

What are your goals?

What is your detailed plan to achieve those goals?

What do you need to accomplish those goals?

How will you get those things you need?

What are the risks?

How will you mitigate those risks?

As long as you know the answers to those questions inside and out, you don't need a business plan.  That said, most people don't know the answers to those questions and that's the purpose of a business plan.

 Absolutely!

If you are a newbie without a plan, I refer to that as ......you become a "wandering generality".

Read real estate books, get an idea of the type of real estate you may be interested in.  Then find out the best mentor for that type of investing.  Then tap into that mentor.  Google several mentor names and see what you find.

I like all kinds of investing and have done most kinds.  But starting out, I suggest you focus on one thing............getting cash flow as fast as you can without starting with a boatload of cash.

Good luck.

Fixer Jay DeCima

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