You may think a great idea, winning personality and lots of enthusiasm are all you need to convince investors to back you. However, while none of those things can hurt, you’re unlikely to get anyone to put their money where your mouth is without a well constructed and properly presented business plan.
What is a Business Plan?
A business plan is, essentially, a detailed document explaining exactly how you will run your business, including extensive market research into how big your market is, as well as analyses of the earning power, spending habits, age, and social-economic profiles of your potential customers.
You need to include specific financial forecasts – how much money you need to fund the business, how you plan to raise these funds, and how many rounds of fund raising you anticipate before the business starts funding itself.
It is also useful to detail how many employees you will ultimately need, and at what stages in the company’s life you plan to recruit them. This not only helps you calculate your ongoing financial needs, but also shows potential investors that you are thinking about the long-term growth and expansion of your company.
How to Start
Most investors will have decided within the first 30 seconds of your proposal (written or presented personally) whether they want to know more or not. It is therefore critical to ensure that you start with a clear, concise, exciting and effective introduction as to why your business idea is a winner, why you’re just the right person to implement it, and why it is destined to not only succeed, but to make serious money.
Then, include a detailed profit and loss statement, with monthly predictions for the first year, and quarterly ones for at least three to four years after that. You should also have a list of every single foreseeable expense you can think of – salaries, utility bills, rental, office supplies, accounting fees, etc.
Conclude with an explanation of who will actually be running the company – a complete organogram is a good idea. Investors invest in people as well as in businesses and they need to know their investment is going to be in good hands.
If you’re looking for accredited investors to share your business plan with, visit VerifyInvestor.com.