The difference between answering the key questions and developing a business plan is, in fact, in the degree of detail. Well elaborated key questions give your business idea a first-class basis for detail planning. You know the phrase: „The devil is in the details“.
In principle, the use of the Seven Key Questions or a business plan depends on
- the development stage of your company in which you are: The more advanced, the more detailed you can describe your business idea and the more data is available for detailed planning. Every business plan dies with the first customer contact, they say. So far we will not go but imagine the situation that you have already dealt with your business plan for months. This has now attained impressive extents. However, you suddenly discover that you have taken fundamental misjudgments in the assessment of how the majority of your potential customers see essential problems you perceived as very serious. Therefore, you should complete your business plan only after the first customer contacts and with the knowledge gained from them;
- the addressees to whom you want to provide the appropriate information. For a first investor pitch, the Position Statement from the Seven Key Questions is best suited while your house bank will make loan conditions dependent on the submission of a detailed business plan that demonstrates the economic viability of your business idea. But business angels and venture capital companies will also want to test your business plan thoroughly for a final decision on a possible investment;
- the amount of the necessary capital: Answering the Seven Key Questions is certainly sufficient for the capital procurement of a small service provider from family and friends while the funding of a capital-intensive high-tech enterprise without business plan will not be possible.