Guide · EasyCofounder
Business plan and financial forecast: a guide for startups
Banks, honour loan networks, public funders and investors almost always ask for a business plan, and above all it helps the founders themselves check that their project holds together. This guide explains what it should contain, how to build a credible forecast and how to use it to run the company.
Updated on 5 min readBy the EasyCofounder team
In short
- A startup business plan covers the problem, solution, market, sales strategy, team and funding needs.
- It comes with a financial forecast: projected profit and loss, cash flow plan and funding plan.
- What matters is the consistency and transparency of the assumptions, not the precision of the figures.
Contents
What is a business plan for in a startup?
A business plan first helps the founders structure their thinking: writing down in black and white who the customers are, how you will find them and how much money it will take reveals the inconsistencies.
It then helps you convince others. A bank, an honour loan network or a public funder will examine it closely, whereas an equity investor will rely more on the pitch deck and look mainly at the key assumptions.
| Document | Content | Main reader |
|---|---|---|
| Business plan | Detailed project, market, strategy, organisation, finances | Banks, public funders, support networks |
| Pitch deck | Short, visual presentation of the project | Investors, juries, partners |
| Financial forecast | Figures over several years based on assumptions | All funders, and the founders for running the business |
What should the business plan contain?
- A one-page summary of the project, the funding need and how the money will be used.
- The problem and the customers affected, with the evidence gathered while validating the idea.
- The solution, how far along it is and what sets it apart from the alternatives.
- The market: target segments, estimated size with an explained method, trends.
- Direct and indirect competition, presented honestly.
- The business model: what you sell, to whom, at what price and on what payment schedule.
- The sales and marketing strategy, as covered in our guide to go-to-market strategy.
- The team, the division of roles and the planned hires.
- The financial forecast and the funding plan.
- The main risks and how you will reduce them.
How do you build a credible financial forecast?
A good forecast starts from operations, not from a revenue target chosen in advance: how many prospects, what conversion rate, what price, what payment terms, how many people to produce and sell.
- 1List your sales assumptions based on the channels and conversion rates you have actually observed or can reasonably estimate.
- 2Cost out the expenses: salaries and payroll taxes, contractors, tools, rent, marketing, miscellaneous costs.
- 3Draw up the projected profit and loss account over several years, in more detail for the first year.
- 4Build the cash flow plan month by month, taking into account payment terms for customers, suppliers and grants.
- 5Build the funding plan showing how the needs are covered: founders’ contributions, loans, grants, funding rounds.
- 6Prepare at least three scenarios, cautious, central and favourable, and check that the company survives the cautious one.
Why does the cash flow plan matter more than profit?
A startup can show growing revenue and still run out of cash, because customers pay late, hires come before sales or a grant is paid after the money has been spent.
- The cash flow plan shows how many months the company can last with the money available.
- It shows when to launch a round or a funding application, taking into account how long it takes to obtain.
- It reveals the effect of payment terms and working capital needs.
- It becomes a monthly dashboard once the business is running, comparing forecast and actual figures.
Which mistakes undermine a business plan’s credibility?
- Spectacular growth with no explanation of what will produce it.
- An impressive market size with no link to the customers you can actually reach.
- No competitors at all, which suggests the market has been poorly studied.
- Forgotten payroll taxes, payment terms or hires.
- Market figures quoted without a source or from sources that cannot be checked.
- A document never updated even as reality moves away from it.
Two co-founders present an honour loan network with a forecast in which their revenue target is reached by the third month. The committee asks them to explain where the customers will come from. They rebuild their assumptions from their real meetings, end up with a slower but credible timeline, and their application is accepted at the next session.
A business plan is also useful for presenting the project to a future co-founder, alongside our guide to pitching your project, and for preparing applications for non-dilutive funding.
Frequently asked questions
Is a business plan mandatory to start a startup?
No rule generally requires you to write one to set up a company, but banks, honour loan networks and public funders almost always ask for it, and it helps the founders check that the project is viable.
How many years should a financial forecast cover?
Forecasts are often presented over several years, with the first year detailed month by month. The expected length depends on the funder, so check with them before building the document.
What is the difference between a business plan and a pitch deck?
The business plan is a complete, detailed document, while the pitch deck is a short presentation meant to spark investors’ interest. Both should tell the same story with the same assumptions.
How do you estimate revenue with no track record?
By starting from operations: the number of prospects you can reach per channel, the conversion rate seen in your first tests, the price and the payment schedule, then presenting several scenarios rather than a single figure.
Glossary
- Financial forecast
- A company’s set of projected figures over several years, built from assumptions.
- Cash flow plan
- A monthly table of cash coming in and going out, showing the money available.
- Funding plan
- A table that sets the company’s needs against the resources planned to cover them.
- Working capital requirement
- Money tied up by the gap between payments received from customers and the expenses to be paid.
Find my co-founder
Build your project with a complementary co-founder
Find your co-founder
By role
Near you
Further reading
- Funding without dilutionFunding a startup without giving up equity: honour loans, innovation grants, subsidies, tax credits, bank loans and how to put together an application.
- Building your go-to-marketBuilding a go-to-market strategy: target customer, value proposition, pricing, acquisition channels, sales model and a 90-day action plan.
- Pre-seed fundingRaising a pre-seed round: how it differs from seed, early-stage funding sources, what investors look for at this stage and the mistakes to avoid.
- Validate your startup ideaValidate your startup idea before looking for a co-founder: customer interviews, demand tests, landing pages, MVP, first customers and go/no-go criteria.
About this guide
This guide was written by the EasyCofounder team — a platform that connects founders, talents and startups — and was last updated on November 9, 2026. It draws on common startup practice and on the questions our members ask.
How we write, review and update our guides is explained on our About page.
It provides general guidance and is not legal, tax or financial advice. For your own situation, consult a qualified professional (lawyer, accountant) and the official resources available in your country.