Cuarto trimestre, Haciendo planes a futuro.

1. Quarter 4: Making PlansQuarter 4: Making Plans
for the Futurefor the Future
March 5, 2017Copyrighted in its entirety, Innovative Learning Solutions,

2. What is new?
Venture capital opportunity
What goes into a business plan?
Venture capital presentations
Learning points

3. Feature R&D // Licensing // Debt
VC Investment // Tactical plan

5. Time
Demand
Introduction
You Are Here
Growth
Maturity
Decline
New brand features, sales offices, and plant capacity
will push you into the growth phase.

6. Time
Profit
Costs to setup and
grow the
business
0

7. Time
Profit
Costs to setup and
grow the
business
0
Revenue

8. Time
Profit
Costs to setup and
grow the
business
0
Revenue
You are here You are trying
to get here
Free
cash flow
Cash shortfall

9. Expand owners’ equity (bring in new investors)
Leverage your investment (borrow money from others)

10. Sell part of the company to venture capitalists
• venture capitalists are willing to invest up to $4,000,000
• venture capitalists may ask for up to 60% of the company in
exchange for their investments
Borrow money

11. Demand is up for the entire industry.
Your firm has established itself as a viable competitor.
New sales outlets would greatly expand distribution, drive up unit
volume, and thereby reduce unit costs.
New brand features could be brought on the market if you invest in
R&D. These brand features will increase customer satisfaction,
and thereby demand.
New production capacity will allow substantial market expansion.

13. Copyright Dominique Garval 2003
ObjectivesObjectives StrategyStrategy TacticsTactics
Actual actions and
operations that are
necessary to
execute strategy
Set of carefully
selected / integrated
business priorities
to achieve objectives
Results to be
attained before
a certain date

14. - Gen. George Patton

15. - Gen. Dwight D. Eisenhower

16. - Adm. Rickover

17. - Almost any venture capitalist

18. History of firm // Performance to date
Strategic analysis // Corporate strategy
Marketing strategy // Channel strategy
Manufacturing strategy // Human resource strategy
Financial strategy // Tactical details
Pro forma financial statements
What is in it for the investors?

19. A tactical plan is a series of interconnected tactics
purposely organized to be executed in a particular order
in time and space for the purpose of achieving specific
strategic goals

20. Q4 Q5 Q6 Q7 + Going Forward
Larger flat
screen
Fast internet
Comfort keyboard High speed
processor
R&D
New
Brands
Sales
Offices
Prices
New laptop
Chicago Paris Sao Paulo
Penetrate
Porta 2800
Main 2000
Penetrate
Porta II 3200
Premium new brand
Main II 3100
New desktop

21. Historical Future
Q4 Q5 Q6
0 13,680 12,130
Beginning Cash
Balance
Q1 Q2 Q3
616,106 2,234,341311,966
Revenues
+ Licensing Income
+ Other Income
+ Interest Income
= Total Receipts
from Operations
Production
+ R&D
+ Quality Cost
+ Licensing Fees
+ Advertising
0
0
0
0
0
0
13,680 6,450
671,100
0 0
2,542,480
0
0
0
0
5,325,162 12,681,800
0
0
00
0
13,680 6,450 671,100 2,542,480 5,325,162 12,681,800
0
0
0
0
0
0
0
0
0
0 0 0 0
104,516 299,8140 417,078 735,148
16,863 210,938 273,799 595,811
185,000 2,451,927 400,00
595,215 1,160,403 2,383,428 5,682,588
125,00
Receipts from Operating Activities
Disbursements from Operating Activities
0
120,000

23. Each team is given 12-15 minutes to present its business plan
to 4 investors.
One or more Venture Capitalist will later visit your firm to ask
questions for 5 to 10 minutes in order to better understand
the plan, the team and the risks and rewards of investment.
One or more VCs will enter into negotiations to invest in your
firm.

24. Each venture capitalist will quickly assess the risk of an
investment in each team and decide the amount to invest and
the price at which he/she is willing to buy stock.
Each venture capitalist can invest up to $4,000,000.
Investors are encouraged to consider a stock price between 70
and 120 per share.
The venture capitalists are independent investors, they do not
have to agree.

25. The venture capitalists may not give you all
the money that you request if they are
worried about the balance of the risk and
reward of your plan.
To make up the difference, the Fast Eddy
Venture Capital Fund will be contacted.
Fast Eddy will invest the balance of what is
needed at $10/share less than the lowest
share price in industry.

26. The business plan consists of a Power Point presentation, plus the
tactical plan and pro forma financial statements.
The $4,000,000 in common stock currently in your firm’s Q4
financial statements is only for planning.
Your Business Coach will adjust the amount of stock and stock
price paid by each investor after they have made their
decisions.
Quarter 4 decisions will be due a little later in order to give you
time to review your financial options and let your Coach enter
the correct investment amounts.

27. Complete Q4 decisions.
Next, prepare the tactical plan and pro forma financial statements
through Quarter 6 and have them ready to review by your
Business Coach.
Meet with your Business Coach to review your tactical plan and
pro forma statements during your normal executive briefing.
Then prepare your Power Point presentation and submit it to
your Business Coach for review and feedback.
Your Coach will provide a presentation schedule with times and
dates.

28. Complete Q4
Work on Tactical
Plan & Pro Formas
Review with Business
Coach Normal EB Time
Work on Business
Plan Presentation
Ask Business
Coach for Review
Present Business
Plan to VCs
Receive Final
Equity Investment
Wrap up Q4

29. President owns the presentation
VP of Finance/Accounting
owns the tactical plan, pro
forma financial statements,
and stock price negotiations.
Have a stock price and
investment amount in hand
before you meet with the
VCs.

30. Manage the future
Take the initiative now by expending resources that will shape
the events and opportunities of the future.

31. Management of Strategy
Discover the causes of performance shortfalls
Adapt to new opportunities and problems
Work on the margin to improve performance
• where should money be spent next?
• how can we get more out of our current investments?

32. Strategic and tactical planning
Specify objectives
Perform strategic analysis
Evaluate strategic options
Choose strategic direction
Select strategic thrusts
Time phase tactics into the future
Work investment money and debt to support tactical plans

33. Understanding cash flows
c
ash is king
h
ow is profit different from cash?
You can not go to Hawaii on market share (at the end of the day, wealth creation is the goal)

34. Competition or cooperation - strategic alliances with competitors
• multiplying resources
• developing markets more quickly versus helping the competition
Game theory and prisoner’s dilemma
(if I do this and they do that, then …….?)
Negotiations

35. Market
conditions
Marketing
strategy
Marketing
tactics
Market
assessment
Market
performance
Manufacturing
conditions
Manufacturing
strategy
Manufacturing
tactics
Manufacturing
assessment
Manufacturing
performance
Human resource
conditions
Human resource
strategy
Human resource
tactics
Human resource
assessment
Human resource
performance
Financial
conditions
Financial
strategy
Financial
tactics
Financial
assessment
Financial
performance
ENVIRONMENTAL ANALYSIS
Business
Strategy
FEEDBACK
Business
Performance
Assessment of
Business Conditions
BUSINESS
LEVEL
FUNCTIONALLEVEL
STRATEGY
Market
objectives
Manufacturing
objectives
Human resource
objectives
Financial
objectives

37. Strategic analysis
Strategic Plan
Corporate
Each function
Tactical plan through Q6
Pro forma financial statements through Q6

38. Competitor Assessment
SWOT (strengths, weaknesses,
opportunities and threats)

39. Market position
Segments
Geography
Competitive strength
Ranking in market
Which firm is a threat?
Market performance
Demand and market share
Customer satisfaction (brands, prices)
Financial performance
Cash
Profitability

40. Mission // Culture // Problem
Corporate objectives // Financial Resources
Basis of Competitive Advantage
Strategic Thrusts
Controls (targets to be achieved by Q6)

41. Strategic analysis
Strategic thrusts
Tactics to support strategic thrusts
List key decisions to be made over next three quarters
Link key decisions to strategic thrusts