Business Plans Forget Other Good Outcomes: Happiness, Creativity, Fun, & Joy

Wednesday, June 08, 2016

Guest Post by Sam Holloway from Crafting a Strategy

Business plans suggest that scale and volume growth are the best paths forward. If you’ve taken money from professional investors with goals of a strategic exit to AB InBev, then scale and volume growth are the best paths. However, what if you have a tasting room, your business partner is also your life partner, and you want to grow to achieve some economies of scale but not grow so much as to take the fun and happiness out of your day to day life? What kind of decision-making and strategic advice should you follow?

We believe the business model paradigm gives entrepreneurs another choice if scale and blindly pursing growth doesn’t sound appealing. If happiness, profitability, slower growth, and creativity are important to you, using a multi-business model approach is a better way to think about your craft beer business. Here are the key differences in shifting from the business-planning paradigm to the business model paradigm (Adapted from Schlesinger, 2009):

Old Paradigm – Business Plans New Paradigm – Business Models
Predict the Future Control the Present
Market Research Market Entry and Experimentation
Full Scale Marketing Plan Short Term - Hypercycle Plan
First to Market First to Mindshare
Be Secretive and Be Perfect: Hide in your office conducting market research, write the perfect business plan, only enter the market after securing outside funding Fail Fast and Fail Cheap: Talk to everyone, get outside the building, launch the business as soon as possible, experiment, fail cheap, learn, try again
Upside market potential drives business plan funding needs Downside market risk drives business model needs
Return on Investment Affordable Loss

To learn more about this topic and to talk to Sam Holloway in person, be sure to attend the Craft Beer Finance & Investment Conference in San Diego on August 24 & 25, 2016! Sam will be kicking off the second day of the conference with a talk onCraft Brewery Business Design: Trade-offs between Scale, Creativity, Happiness and Profitability”. 

Works Cited

Comparison Table Adapted From Len Schlesinger (2009). Babson College Innovation Associates, Inc. Conference Presentation.


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