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The importance of long term planning when building a startup

When entrepreneurs work on one of the most important parts for their startup – the business plan – they tend to overlook the importance of long term planning. At the very moment of starting and building the foundations of the company it doesn’t appears to be the right time to spend time to determine the ten-year-from-now future. This planning gap can affect your prospective funding chances and can be critical for your long term company success.

Why long term planning is important?

Investors look at the big picture when investing their time and money, especially when it comes to startups which promise innovation and business longevity. Entrepreneurs must have clear vision on where their company will be in ten years and be ready to support their predictions with solid data analyses. Of course, expectations vs. reality has always been the clash of the titans when we form our long term goals, but having strong position and confidence not only in the long term existence of the company, but in its profitability, is a must and allows one strong business start.

Where will your startup be in ten years?

Entrepreneurs must have clear vision on how their company will look like when it is already strongly built and doesn’t rock the startup title any longer. Know what you want to achieve with the complete version of your idea and plan and strategize according to this. Goal-oriented five year plans are certainly very important, but they are not the complete representation of your longest term planning and business vision.

Think what a company will need from the beginning in order to become this complete, strong and highly valuable company that you have in mind ten years from now. Calculate and plan how the company will grow, how the product will develop and what other products and services you will be able to provide to the customers and still be able to meet the market changes.

Build according to your goals. Many entrepreneurs want to create a company which they will be able to sell for a bigger profit. Others want to dominate the niche and still be the head of the company or to go public. Plan your long term goals according to your long term expectations. Build with the purpose to satisfy the needs of “the bigger customer”.

Create the future of your company by acting towards the execution of your vision. Your after-ten-years-self will look back and thank you for the hard work. Starting up is challenging. Often founders allow themselves to change their course of direction. This is part of the execution, but the long-term goal is what will keep your vision clear.

Secure your company’s future and plan in advance in order to predict the future, take all the opportunities and build your way to the top.

─ December 8, 2014