What Your Business Plan Needs to Convey to Potential Investors

Written by admin on October 25th, 2011

If you are hoping to attract the attention of a business angel to your new venture, it’s imperative that you have a complete, professional, and comprehensive business plan. They will scrutinize your plan carefully to make sure your business fits within their investment goals. You need to know what it is they are looking for before you present your plan, or it could be a waste of time for all parties concerned.

There are many components of a business plan. If you want to appear serious and professional, consider hiring someone to create and design your plan with you, or purchase software to help you create it. The point is, don’t write your plan on the back of a take-out menu or a napkin; this will not convey the image you want to a potential investor.

Here are the key components of a business plan:

Summary – this is usually a short, one page document that summarizes your business, your objectives and your product or service.

Skills and experience – detail your past business experiences, education, awards, skills, talents, etc. Go ahead and toot your own horn, this is not the time to be humble. Investors will want to know what you are bringing to the table.

Information about you – this a more personal look at you, where you’re from, why you started your business.

Your Product or Service – What makes it different from the competition? Is it in an innovative or high-growth industry? How much market share do you hope to obtain? How much market share do your competitors have?

Financial Data – It’s important to be as detailed and accurate in this section as possible. You must list all expenses: utilities, salaries, rent, machinery, equipment, supplies, etc. Also, list your income from all sources: sales, investments, etc. Give your potential business angel a detailed look at how much the business is costing you to run (or going to cost you if you haven’t actually started yet,) and how much income you are generating.

Goals – Have income and expense projections and general business goals for at least the next 5 years. What direction do you want to see your business go in?

Marketing and Advertising – How are you going to market your business? Are you going to be using an advertising firm, or creating your own? Don’t forget to list these expenses in your financial data section.

A thorough business plan takes time and effort to complete, but once you have it, your chances of attracting an interested business angel is much higher.

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Leave a Reply