What a great idea! Do you have a business plan?

According to business e-zines there seem to be companies who can get funding without even having a business plan. OK as I write that I'm specially thinking of one company in particular: Twitter which has raised at least $55 million from Benchmark Capital, Spark Capital, Institutional Venture Partners and Bezos Expeditions without having implemented a proper revenue model yet in despite of having ideas on how to generate money. So how do they do it?

Behind a company you have people and that's where one has to look first. Fact is Evan Williams, Twitter CEO, also co-founded Blogger in 1999, which Google bought in 2003. Means you have one guy there who's got experience in not only developing a business successfully but whose business has done very well with a quick and very profitable exit. That builds attraction, credibility and trust: the guy is actually capable of delivering and has proved it.

Twitter is not generating money at this stage. Actually the startup plans to use its new funds precisely to develop revenue models. Furthermore Twitter has already started in developing key business partnerships. Which means... Tada!... They've got a strategy.

As Twitter's CEO put it on December 2008: "We will make money, and I can't say exactly how because...we can't predict how the businesses we're in will work." Indeed how can one forecast what needs to be done one year from now? What credibility can you give to a document that pretends to cover at least a three years period? Specially considering that there's not such thing as a static market. Customers and competition are actually the two basic elements of any market. And they're active. Very much so. According to the Basic Rule Of All Competition "you are not smarter than either the customer or the competition". And that's why you cannot have a "roadmap to the future". In relation to competition threats Evan Williams adds: "I'm pretty sure they are (planning to), but we can't worry about that. Focus is a really big deal. Even Google stumbles on the focus issue. It's not as important as search and advertising. Innovator's dilemma works against bigger companies." Again: strategy.

So there you go. Now the question is if this works for Twitter would that work for other startups? Or do Twitter have a business plan which they haven't officially released... At QuoVadis Live! quovadislive.com we don't have a business plan but we have a pretty clear strategy to support a great idea!