When seeking angel investors, venture capitalists, private equity firms, and/or debt capital for your new company, your business plan is the most important piece of presentation material you will create.
Investors that have shown interest in learning more about your company will expect to see a business plan. In order to keep interest from prospective investors, make sure you give them a concise plan. Eventually investors will read the entire document, and it will impact their opinion of you and the company, as well as the perceived growth potential.
Experienced equity capitalists (e.g., venture capitalists) look for a wide range of specific information about your company before pumping money into it. They want to know your company is poised to grow quickly and smoothly towards an "exit" or payout for the investor.
All good business plans contain an executive summary; company analysis; industry analysis; customer analysis; competitive analysis; marketing plan; operations plan; a description of the management team; the all-important financial plan; and finally an appendix containing supporting materials (e.g., charts, illustrations, full descriptions of proprietary technologies.)
This can seem overwhelming, so to orient yourself, here are three questions you need to answer in your business plan
1. Does my company fill a market need?
Demonstrate the "need" of the customers for your product or service. Who are the customers, and just why is your service "just what the doctor ordered" for their needs? Include evidence that your client base is asking for the product or service that your company is offering. This will help give investors confidence in your product and company.
2. Does my management team have the pedigree to succeed?
Your management team must bring a track record of experience to the table when seeking investors. Make sure to highlight success of the relevant departments in the company's growth thus far, whether it is start up, research/development, hiring, product release, or advanced phases. How will these skills transfer to the new growth of your company?
3. Are my pro forma financial statements comprehensive, realistic, and based on verifiable data?
The pro forma statements are the ultimate sales tool. It demonstrates in a numeric picture the financial forecast of the business. It is the best way to verify the realism of the business plan as a whole, as you show the projected costs and earnings for potential investors.
Investors that have shown interest in learning more about your company will expect to see a business plan. In order to keep interest from prospective investors, make sure you give them a concise plan. Eventually investors will read the entire document, and it will impact their opinion of you and the company, as well as the perceived growth potential.
Experienced equity capitalists (e.g., venture capitalists) look for a wide range of specific information about your company before pumping money into it. They want to know your company is poised to grow quickly and smoothly towards an "exit" or payout for the investor.
All good business plans contain an executive summary; company analysis; industry analysis; customer analysis; competitive analysis; marketing plan; operations plan; a description of the management team; the all-important financial plan; and finally an appendix containing supporting materials (e.g., charts, illustrations, full descriptions of proprietary technologies.)
This can seem overwhelming, so to orient yourself, here are three questions you need to answer in your business plan
1. Does my company fill a market need?
Demonstrate the "need" of the customers for your product or service. Who are the customers, and just why is your service "just what the doctor ordered" for their needs? Include evidence that your client base is asking for the product or service that your company is offering. This will help give investors confidence in your product and company.
2. Does my management team have the pedigree to succeed?
Your management team must bring a track record of experience to the table when seeking investors. Make sure to highlight success of the relevant departments in the company's growth thus far, whether it is start up, research/development, hiring, product release, or advanced phases. How will these skills transfer to the new growth of your company?
3. Are my pro forma financial statements comprehensive, realistic, and based on verifiable data?
The pro forma statements are the ultimate sales tool. It demonstrates in a numeric picture the financial forecast of the business. It is the best way to verify the realism of the business plan as a whole, as you show the projected costs and earnings for potential investors.
About the Author:
If you'd like to know how to finish your business plan quickly and easily, then consider using a business plan template, so you finish your plan in hours, not days, weeks or months.
No comments:
Post a Comment