Marc Andreessen says that a startup’s initial business plan doesn’t matter that much. I disagree. He says the plan doesn’t matter because you’re doing something new in an uncertain world. I say, on the contrary, that the plan might be worthless, but planning is essential — and you can’t have planning without the initial plan. I said that in this blog just two months ago, in Business Plans Are Always Wrong. “Planning means starting with the plan and then tracking, reviewing progress, watching plan vs. actual results, correcting the course without losing sight of the long-term destination.”
I don’t know Marc Andreessen, but I know of him. He’s one of the most successful entrepreneurs in history. A co-founder of Netscape, who just sold Opsware to HP for $1.6 billion. I don’t like disagreeing with someone who’s been so obviously right so often, but what’s up with this?
I don’t believe he doesn’t respect planning. After that contentious lead paragraph, he implies the importance of planning process in the follow-up:
“And you will probably have to rapidly evolve your plan — possibly every aspect of it — as you go.
(The military has a saying that expresses the same concept — “No battle plan ever survives contact with the enemy.” In this case, your enemy is the world at large.)”
Actually what the military says is the famous quote from Dwight D. Eisenhower, general and president, who said “Plans are worthless. Planning is essential.” That’s what I’ve been saying, and I bet, if we could ask him, that’s what Marc Andreessen meant.
I think I know what’s happening here. Find a group of adults who were all straight-A students in school, and asked them whether they studied hard. They’ll all say no, they didn’t, they played instead of studied. Do you believe them? It’s not cool to have studied in school, especially when you can just claim you didn’t have to. Is it just me, or is it suddenly not cool to be planning? We had the whole thing about Twitter not having a plan last week (my previous post) and now Marc Andreessen saying that the initial plan doesn’t matter that much.
I don’t think he’s really advocating not planning, and I don’t think he’d disagree with the importance of the complete planning process, which is, ultimately, management. If that’s what he meant, I wish he’d said so.
I think Andreseen's post clearly shows that planning is important, but that WHAT you plan is not ultimately important, rather what is important is that you be ready to change the plan.
You seem to mostly agree 😉
Twitter has a plan, but it's only 160 characters!!
Actually, Twitter should start preparing a "Going Out of Business Plan."
I agree with Marc on this, maybe you want to think about a 300% turnover increase in a month, that is the reality we dealt with in the late 90's as ISPs.
Having a plan is good, wasting too much time on it bad and expecting it all to be different is good. So even in your own post you agree that "Plans are worthless", at least to a degree.
I think Marc could have said something about the importance of being directionally correct. Are you aiming your target in a space that is going to likely grow over time or are you just randomly shooting? Lucky accidents do happen once in a blue moon but I bet that any businesses with long term success are those who have people behind them with vision (I would argue that Steve Jobs all along has been a visionary even though people especially in Silicon Valley — a very incestuous place oft full of jealousy and bickering — were writing off Jobs after he started NeXT. But if it weren't for NeXT then Apple would have be where it is at today.
This might depend on the stage the startup has reached. In the very early days, the key if to reach product/market fit: most of the time (if not all the time), the initial idea and entrepreneur has and what ends up getting customer traction are not the same. To reach the product/market fit, you need to listen, experiment, iterate very fast. Progress is not necessarily linear. There is value in keeping the planning to the minimum: design, prototype, pitch, iterate. Over planning and tracking gives you the false sense that you are in motion and help you accelerate…just to realize you are not sure what direction you are heading and if you are getting closer to the goal.
Once you reach the product/market fit, planning becomes key because at that point it is all about scaling, execution and coordination among a much larger group of people.