Form or Substance: Business plans and venture capital fundraising

I've received some coverage of my paper joint with David Kirsch and Azi Gera on business plans. We find that they aren't that helpful for VC fundraising. The WSJ wrote about it, along with peHUB and Healy Jones at startable.com has some particularly insightful comment. Here is some video for those that don't like to read.

Healy Jones writes that it makes much more sense to get an introduction from a successful entrepreneur - but that if you don't have much of a track record, getting someone successful to introduce you is hard. That is precisely the point! Writing a business plan has become very easy - so its production does not help a VC distinguish between good and bad prospects - a business plan is the equivalent of cheap talk. Getting an introduction is hard - and so it may be a better signal of how entrepreneurial an entrepreneur is.

Our study is silent about about the importance of planning - only that a planning document does not help very much in the VCs initial screening stages.

email me for copies of the paper if you're interested.