A case study in writing your business plan

How Sandrine Zhang Ferron approached the daunting task of writing a business plan for her company Vinterior, an online marketplace for quality vintage furniture.
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When Sandrine Zhang Ferron moved from a loft-style flat in Shoreditch to a five-bedroom Victorian house in north London, she realised that flat-packed furniture from Ikea just wasn’t going to suit the vibe. The new house was a different taste and style; it needed furniture that was fresh and unique and that reflected the personality of its owners.

This led her down the rabbit hole of furniture shopping – she was soon spending weekends trawling through vintage and antique shops searching for one-of-a-kind pieces, and checking out Gumtree and eBay for deals in her area. ‘At the time, I thought it would make so much more sense to have an online shop where you could browse all available products from [offline] vintage stores and independent retailers,’ she says. 

Six weeks later, she quit her job in investment banking and began working on the idea for Vinterior – a curated online marketplace for quality, pre-loved furniture, which she launched in 2015. The company works with 1,600 independent furniture dealers worldwide and has more than 100,000 pieces of furniture, lighting and decorative items on its platform.

Discover your company’s narrative

Writing up a business plan wasn’t necessarily front of mind. In fact, Sandrine’s first goal was to join a coding boot camp and build the Vinterior website from scratch – as well as get a foothold in London’s tech industry, where she could build connections and hire engineers. ‘I was bootstrapping the business at the time and didn’t really have a time constraint on building a business plan,’ she says. 

It wasn’t until she applied for Seedcamp, an early-stage venture capital fund, that she realised she had to condense her ideas and ambitions into a written document. Before using any presentation software, Sandrine put pen to paper and thought about Vinterior’s overall narrative. She asked herself: what problem exists and how is my business going to solve it? 

The next step was proving there was a market for Vinterior – she spent time sifting through online reports to find data about the size of the market, what customer segments existed within it, and who Vinterior would target. ‘What interests investors when you’re pre-product and pre-revenue is to sell this vision of a big market opportunity,’ she says. ‘It’s about finding out how big the market is in your country, the wider continent and the rest of the world; what the level of demand is; and how you will tap into that demand.’

Sandrine then used Google Slides to create her business plan. It includes seven sections:

1) problem and solution; 2) market size; 3) business model; 4) team; 5) products; 6) company milestones; and 7) financial projections. 

Having a team of founders at Seedcamp to compare notes with at this stage was a huge advantage, but the internet was still her primary resource. She’d use websites like Medium and its countless articles by business owners offering tips and details of their own structure, and then looked to venture capital firms with downloadable, ready-made templates.

Form early assumptions

The crucial step of estimating revenue for the first 12, 24 and 36 months was a tricky task in the early days. ‘We had quite complex projections to make because we needed to focus on the supply side of the business (the independent retailers we work with) and the demand side (the customers) and being able to balance both at the same time,’ says Sandrine. An ‘extensive’ Microsoft Excel sheet did the number- crunching for her.

When it comes to estimating market size and revenue turnover in the first, second and third years, Sandrine says you have to allow for imprecision, as a lot of the numbers you come up with won’t be accurate. ‘Coming from a financial background, I found it challenging to write down figures based on guesses rather than hard facts. It felt like I was just stabbing in the dark,’ she says. ‘But, as your company matures, you’ll be able to confirm or reject your initial assumptions and make your business plan more precise.’

For first-time business owners, talking to other companies with similar models that are at a later stage might be useful – they may have some wisdom to provide about how you make those first financial projections, and can walk you through the process.

Be prepared for changes 

Sandrine describes her business plan as a living, breathing product that she continues to add to as she goes along. ‘Good and bad things will inevitably happen that you weren’t expecting and you will have to adjust your plan,’ she says. For example, an economic or personal crisis, new investment or even a new group of customers you didn’t think would be interested in your product might tilt your numbers. 

In fact, the initial financial projections she wrote down in Vinterior’s business plan ended up being quite far from what was achieved in reality – but this is normal, she explains. While companies can’t predict market changes or other obstacles down the line, having a business plan can help with risk mitigation. Sandrine uses her business plan as a tool to plan for several possible scenarios, which helped Vinterior adapt to the recent crisis.

‘When Covid-19 hit the UK in early March, we spent a lot of time referring to the business plan to understand how our core structure works, what our spending looked like and where we could make cuts, and how we could boost efficiency. This helped us figure out how to weather the storm,’ she says.

For Sandrine, building a business plan was a way for her to collate her ideas and clarify her thinking on what she wanted to achieve. It also helped her explain her business concept to her team and investors. ‘Creating a business plan is a valuable exercise; it’s a process,’ she says. ‘It’s not a bible you have to stick to, but a way to understand what questions you need to ask yourself and how you answer them.’ Business plans are, however, crucial to map your company’s growth. ‘When your company becomes more mature, your financial projections start to matter a whole lot more.’

Sandrine's Sources

Five ways she assessed the market.

1. Analysing the specific sector

Sandrine got a grasp of the European furniture market as a whole, from the online report The EU Furniture Market Situation and Possible Furniture Products Initiative.

2. Looking at continental trends

Eager to understand broader movements in the second-hand sector throughout a wider territory, she analysed the online report An Investigation and Analysis of the Second-Hand Sector in Europe.

3. Examining similar markets

Widening her scope into tangentially linked sectors and markets – in this case, the art market – she looked at the report The British Art Market in 2014.

4. Using wider online data

Sandrine sought out general category and geographic data by hitting up websites such as statista.com where you can find free – and paid for – data.

5. And a spot of guerrilla research

Beyond the industry reports and online information, Sandrine also did some of her own research: she turned to counting search results on Yell and Google to get a general sense of demand within the vintage market.

Sandrine's tools

The online articles and guides she found useful.

1. How to pitch

Kima Venture’s succinct pitch deck template on Medium.

See our guide to fundraising pitch decks here.

2. Find a template

Another simple and downloadable pitch deck template from Nicolas Wittenborn, of investment company Point Nine, on Medium.

3. Stick to the plan

Ash Maurya’s Medium post and audio clip, which argues why creating a ‘lean canvas’ isn’t enough to replace a business plan.

4. Be a super model

The E-Commerce Financial Model for Startups, from eloquens.com. This is a detailed and free-to-download guide specifically designed for founders launching their stores or getting operations off the ground.

5. Follow by example

Examples of the best pitch decks from successful startups such as Airbnb, Uber and Peloton, are available at slidebean.com.

This article was first published in How to Start a Business 2021. To become a subscriber or purchase our newest guide, head to our webshop.

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