Business plans serve multiple functions such as setting a benchmark for growth, attracting investors and acquiring funding from investors. Creating the ideal business plan for investors can help you with fundraising more than any other endeavors. It is essential to learn the art of creating a business plan to attract investors. Often, before you even give your passionate pitch, investors will first want to take a look at your business plan. Here are some pointers on how to create the most effective business plan for investors.
What can a business plan showcase?A business plan can help highlight key factors which are essential in your quest to acquire funding from investors. A detailed business plan helps the investor visualize the progress of the company and cements the idea that a lot of thought has been gone into the business venture. It also allows investors to hold the entrepreneur accountable for growth by taking into account a set of financial benchmarks to compare with.
How to create a business plan for investors?Now that you know what a business plan can do to help you acquire funding from investors, here’s a step-by-step guide to crafting a business plan to attract investors.
Your entire business plan should read like a marketing brochure, loaded with enthusiasm and positivity. Your investors should feel compelled to be excited for the business venture after reading your business plan. Include your vision, mission and a set of goals that you have set for the company.
Investors will back only those business ventures that have high growth potential. They are looking to double their investment in short time spans of 4-5 years. Knowing your market is imperative to assess the growth potential of your business venture.
The worst mistake that you can make while drafting a business plan is assuming that investors understand the technical jargon associated with your business product. Explain your business idea or product in the simplest terms possible, so that a reader from any background can easily understand what it is.
If your business has to succeed, your product needs to sell. Investors need to see if your product will gain traction with consumers. You need to clearly demonstrate the specific product need in the market that your product will fulfill.
Investors appreciate entrepreneurs who understand risk management and account for them in the business plan for investors. You need to have a section in your business plan which states major risks associated with your business and your plan of action for tackling them. This shows the investor that you are prepared to handle any operating risks that may arise and that their money is safe with you. Such a business plan will help you acquire funding from investors easily.
These are the steps involved in drafting a business plan to attract investors. Follow it religiously to create an effective business plan for investors and your business plan will serve you well. Speak to an adept accounting service in Canada to help you with the financial aspects of planning your business.