MAIN Business Small Business Business Plans
How to Write
an Investor Ready Business Plan
plan, as all good entrepreneurs starting out in life should know
is the foundation, or rather a springboard, towards the establishment
and growth of a new business. A business plan is an essential
tool for companies raising capital and your business plan
needs to be "investor ready."
an investor ready business plan?
ready business plan is a document that has been professionally
prepared to meet the needs of both venture capitalists and angel
investors. In your business plan, you should be able to see your
own project through the investor's eye. Your plan must be able
to answer the concerns of an investor.
both VCs and angels, are risking their hard earned capital by
investing in your venture in the hope of long term returns that
are worth many times their original investment. An investor ready
business plan demonstrates to investors that you are an expert
in your industry and that you have a clear mission. An entrepreneur
addresses these needs by preparing a comprehensive and detailed
view of their business objectives and goals.
|Investors invest in management - not just ideas.
Here are some important sections
that address major concerns of financial backers who want to invest in winning startups:
invest in management - not just ideas. It is very important that
you express your knowledge, passion and dedication to your business. The competence of your team along with their
experience levels and their commitment levels are also factors
that investors look into before making their investment decisions.
It is important
to communicate to the investors that you understand the needs
and requirements of your customers and to articulate your marketing
strategy within your business plan.
description of the product or the services offered by you should
be outlined in detail. A description of the overall market for
your product or service, along with the details of your customer
base is essential. The investors need to know the reach and the
kind of customers your product / service is going to attract.
One of the
most important sections of your business plan is your marketing
plan. This section will outline your sustainable competitive advantage
to your investors. It's a way to assure them why you will succeed where
others have failed. This section is where you include a definitive
description of your customers, market size, demographics, characteristics,
growth prospects, trends and sales potential per product / service
Here is where
the pricing strategies are outlined and how they can directly
influence the growth potential of each product /service. It is
also important to include the future growth, market share and
giving the details of what your product / service is and who your
customers are, you also have to inform your investors how you
will you prevent your competitors from taking away your customers.
The barriers to entry section outlines your business strategy
to keep your competitors at bay and grow in the market. Investors
need to feel comfortable about the soundness of your strategy
before they invest in your venture.
Howard Schwartz is a Business Plan Consultant and a partner in investorbusinessplan.com. He is based at Stanford, Connecticut, and has helped many young
entrepreneurs start out on their business careers by preparing a comprehensive business plan for them.