10 Steps to Develop a Venture on Maui - by David Fisher
1) Self Assessment - Do some exercises to clarify your strengths and weaknesses. Be clear about what your passion is. Tools to help with this include books like "What Color is Your Parachute" by Richard Bolles and/or "Wishcraft" by Barbara Sher. If you are not already involved in the Maui Community, get involved by joining community groups. Volunteer, network, and ask your self "how will my business enhance the immediate and larger community?" Recent community focus groups on what people on Maui believe is important are reported on at FocusMauiNui.com
2) Write First Draft of Marketing Strategy - Create a hypothosis of what you think you want to do, specify the
3) Research Viability, Costs, Key Players - Test your hypothesis by talking to potential customers, suppliers, landlords, competitors and complimentary businesses (both on Maui and elsewhere), find out what trade associations cover your proposed business, contact them for information, go to trade shows. If you do not have experience in the proposed type of business--get some (either yourself, or a partner or consultant/mentor who is very experienced in the proposed type of business. Contact the Hawaii Business Research Library to see what has been written about the industry, competitors, customers, etc. Think out your operation, what kind of facilities (if any) will you need? What kind of skills? Time committments? Equipment? Leasehold Improvements? Operating Expenses? Insurance? etc.
4) Create Initial Financial Projections, Analyze to determine how much money you might need to start the business, what kind of sales can you achieve, and whether it makes economic sense (how much will you earn for your time, for your investment of money?) This used to be called "does it pencil out?" Nowadays people use a computer spreadsheet program like Excel, if possible. If this is Greek to you, get a family member, friend, take a class, work with an SBDC consultant, or paid consultant to help you with this--although you should not spend too much time (1-3 hours max) at this stage. You may decide that it does not work, and that you have to come up with a new hypothesis.
5) Develop Preliminary Financing Strategy - With your estimate as to how much money it will take to start the business, figure out how much you can cover from savings, partners, friends and family. You may be able to cover 50%-80% of the financing with a bank loan, depending on the riskyness of the venture, what you have as security/collateral for the loan, and you and key players' credit rating. Altrnatively, you may be able to get funding from a community loan fund, someone who will benefit from you going in to business (suppliers, customers, complementary businesses, angel investors). Develop hypotheses as to how you will finance the business and repay the funding sources.
6) Reseach Specific Reqirements - Contact the Business Action Center in Oahu (984-2400 x 6-2545) to find out what government permits you may need, what the process for obtaining them is, the timeframe, and cost. Talk to bankers and other sources of finance to test your hypotheses, and pick up application forms. Speak to one or more attorneys and a Certified Public Accountant or very experienced bookkeeper to get their advice as to what you need in terms of legal structure, and contracts, and what it will cost for their services and when you will need to pay. Refine your costs estimates from suppliers--get it in writing. Get a preliminary lease from a landlord (including a subject to obtaining financing clause).
7) Create a full draft of a business plan. Try to keep the plan succinct and factual. It does not need to be more than 10 pages (five pages is even better) including financials. Make sure you have copies of your own tax returns for the last three years, and if you are buying an existing business, get copies of their financial statements for the last three years. Get resumes of all your team members for the appendix, and write short summary bio paragraphs for the body of your plan. Include in your appendix copies of directly relevant market research, bids from suppliers, leases, etc. See the business plan links on the MauiEnterpriseForum.net website. Consider taking a business plan class (see SBDC Workshops), also the Core Four program offered by MEO,and the Business Plan class offered by the Center for Entrepreneurship at MCC.
8) Use refining this draft as a way to develop your team and your extended team. This may be an appropriate time to register trade names, create legal entities, etc. If you are going for equity investment you may need to find out the prefered legal structure for your investors.
9) Submit your plan to financing sources.
10) After receiving written approval for financing (or better yet, money in the bank) initiate the launch of the business.