Business Planning for Success – Workshop with Paul Gaudin #NHSClinent

Without the right product and heart in the right place you will never become a multimillionaire.


The key is partnership. You need to partner in order to succeed because this will reduce the odds of failure.

You have to sort out the legal infrastructure of your business otherwise you will fail. The IP issues are massive. You will have people issues and management issues as well.

Critical Success Factors:

Start at the end and work backwards. Sense check – the outline business plan or lean canvas. What is the likelihood of success? This is something you just learn over time.

Distribution – what is the best/fastest/most profitable route to market to achieve your plan? How many mouths to feed on the way? – This HAS to be in your model.

Are you a product or a business? (If you are just a one product business then this is highly volatile and risky)

Are you in a position to pull this off. Do you really need a CTO etc? How quickly can you pull it off and are you in the position to pull it off?

This is all about patient care and these things deserve to be in the market.

What do you want to achieve?

Are you in the right place in your life? Training, personal financials, relationships, skills, etc.

Have you got the right team? (This needs to evolve along the way). Shareholder agreements when people fall out are a nightmare. You have to plan it into your business journey. As you change gear your on the cusp and red line the business. Then you solve the problem and hopefully rescue it, however, its much better to plan for this!

What is your business model? How will you generate cash.

Have you got the capital to see it through? Nobody ever has enough capital. Double everything (once the plan has come together).

Where is your market? Setting up offices in major markets – they are different all over the world! Even in China things are changing and starting to get better. There are massive healthcare markets there.

How big is it and what % can you expect to convert? (0.1% or even 0.01% is an amazing start)

The 4 P’s.

Reasons for Failure:

  • Lack of experience, (this is learned)
  • Poor leadership, (you can learn this)
  • Lack of research, (This is critical)
  • Lack of focus, (too many ideas, but lack of focus)
  • Lack of capital, (common)
  • Lack of realism, (get real)
  • Poor team dynamics, (if you don’t address the cracks it will split)
  • Wrong skills, (get the right skills and the right people. Otherwise they will be finite (which is ok as well but it needs to be planned)
  • Lack of distribution, (what channels can you use)
  • Over trading, (don’t overtrade or you run out of working capital, look at the bottom line). CASH IS KING! Planning, planning, planning.
  • Lack of innovation, (others will catch up if you become complacent)
  • No strategy (don’t be afraid to adapt to the market). It is accelerating more and more at a rate of knots. The culture is changing. There used to be only a few entrepreneurs, now there are many and this is changing the culture.

What makes a successful innovation?:

Is it worth doing? Are you providing a service solution or a product. Can I make sufficient margin out of it? Is it valued> If so how much and by whom? Who pays? Follow the wave – be a fast follower. Is there evidence or research? What is the cost and the timescale to market? Have you got enough research and capital? (DOUBLE IT!) Will you gain sufficient distribution before competition overtakes you?

For the first time businesses are having to compromise on how long it takes to get a new idea out because they can’t afford to wait any longer. Don’t wait till its too late! Plan ahead. Evidence and research is becoming less important by necessity. What is the best chance of success to impact problem x (Diabetes for example.) A lot of businesses keep a low profile with secret partnerships, and then come out of nowhere because this is a great way to succeed.

distribution, strategy, margin, time , marketing budget – These are the things people tend to underestimate.

Other tools: OGSM – The 1 page business plan. Objective, Goals, Strategies, Measures.

Business Models

Business Model is quite simply ‘how you plan to make money’.

De-risking your model:

  • Synchronise with your main client of distributor
  • Discounting, freemium, up-sell, cross-sell, etc…
  • Deploy a responsive and multi-channel strategy with different pricing models delivered against a common RRP
  • Develop a loyal test consumer group who can act as your canary in the mine.

4 P’s: Product, Price, Promotion and …

Financial Modelling:

Sales – A

  • D2c
  • Distributor
  • International
  • Licence
  • Franchise

Sales – B

  • Production Cost
  • Sales and Marketing


  • Human resources
    • Directors
    • Management
    • Production
    • Sales
    • Admin
    • Other
  • Material
    • Rent and rates (how can you best find the lowest cost rent and rates and work it down)
    • Light and heat
    • Communications and IT
    • Professional Fees – (Lawyers you have to have them, they win either way) Patents require feeding and growing. They can cost an enormous amount of money. £7million case recently – took many years (extremely frustrating).
    • Marketing and PR
    • Finance Cost

Output – D

Operating profit is C – D

Profit percentages vary per industry. R & D costs and fixed assets are deducted from the profits to generate and end of year profit and contribute to the balance sheet. Massive variations between 100% gross profit and 30% depending on industry. Revenue is vanity. Profit is sanity.

Share capital can inspire confidence.

Liquidity ratios enable you to borrow money (look this up) – Available cash you have got to enable you to cover your debts.

Valuations – what are they valuing you on? Main measures – current and potential.

Investors are interested in shareholder value (this is very different to making money). Distribution channel, number of customers, revenues, profit, product, IP, patents.

EBITDA = net profit + interest + taxes + depreciation + amortisation.
Look at the chief exec. Are they growing the business or consolidating it? Are they a 2 year CEO = probably stay away. 3-5 they might be making long term value for the business. It’s the business cycle that counts.

Case Studies:

New York bagel company. 18 months R&D. $1 million startup costs, $1 million marketing costs. Took a year to get the water content right. Good repeatable revenues, high barrier to entry for competitors because of distribution and brand. Year 1 – 2m bagels – 5 year ROI. 10 years too early – nobody knew what a bagel was. Supermarkets wanted preservatives added. If they had started at the end they might have been able to bake this in from the beginning. They had to be sold as the bread roll with the non-fattening centre because people didn’t get them.

Q Score. Total pivot from bagels. Totally different concept. Single number that gives you a cardiovascular risk. Doing in conjuction with key healthcare people. Now moved into corporate wellness market.

Carebnb and Tutella – 3 hospitals signed up to enable social cohesion back to care. We are heading towards a big change in the proportion of carers to those who need care. Japan will hit 1 to 1 by 2050. The patients now have the data. They are becoming real experts. The money is migrating to the consumer which is a good thing.

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