ENTREPRENEURSHIP AND PLANNING

Interviews with the founders of 100 companies on the 1989 Inc. "500" list
of the fastest growing companies in the United States revealed that entrepreneurs
spent little effort on their initial business plan:

• 41 % had no business plan at all
• 26% had just a rudimentary, back-of-the-envelope type of plan
• 5% worked up financial projections for investors
• 28% wrote up a full-blown plan

Many entrepreneurs, the interview suggested, don't bother with wellformulated
plans for good reasons. They thrive in rapidly changing industries
and niches that tend to deter established companies. And under these
fluid conditions, an ability to roll with the punches is much more important
than careful planning....
Peter [Zacharkiw] did not conduct any research.... He placed an ad in
the Washington Post to sell his computer. He got over 50 responses and
sold his machine for a profit. Peter figured that if he had had 50 machines,
he could have sold them all and decided to begin selling computers from his
home "First, we sold to individuals responding to ads. But these people
were working for companies, and they would tell their purchasing agents,
'Hey, I know where you can get these.' It was an all-referral business. I gave
better service than anyone else. . . . After customers started asking for
Compaq machines, [his firm] became a Compaq dealer, and the business
really took off. "We're very reactive, not proactive," Peter observes. "Business
comes to us, and we react. I've never had a business plan.