Should Start-Up Founders Forget About Business Plans?
This past summer, HubSpot Inc. received several offers from venture firms to invest in the marketing software start-up. The company wasn’t looking to raise funding yet–it still had about $5 million left from a $12 million Series B round in May 2008–but rather than wait HubSpot decided in October to accept $16 million while it was still on the table.
That was the third round for HubSpot, which has raised more than $30 million from venture firms in just two years. And it’s done it all without a formal business plan.
“No venture capitalist actually asked us for a business plan,” HubSpot Chief Executive and founder Brian Halligan said last week at the Puerto Rico Venture Forum.
Halligan believes “it’s a fool’s errand” for start-up founders to create a business plan. He knows a lot about raising capital, serving as a venture partner at Longworth Ventures before his current position.
