Business Plan Progress

There are many facets to a business plan that investors are concerned with but there is one in particular that could mean the difference between getting funded and getting passed up. The most important section of a business plan that investors will be looking at is the executive summary. An executive summary is a clear, concise and condensed version of a business plan that will compel readers to dive into the rest of the plan. This section is the final section to be written into a business plan and will embody the “who, what, where, when, why and how” of the business. Investors want to know if the business concept is viable and that it makes sense, that it was well thought out and thoroughly planned, that there is a clear-cut market for your products and/or services, that the financials are realistic, and that the investors will get an excellent return on their investments. In effect, if all of these items are present in the executive summary, the investor will most likely commit to reading the remaining sections of the plan (Abrams, 2010). 

Based on information provided by experts in this field, I have made several changes to my own business plan. I began by paying special attention to the length of my business plan. This meant moving all of the graphs and other miscellaneous info pertinent to my plan to the appendix. I also made sure to incorporate an introduction to my business in every chapter so the reader knows the story behind the business no matter which section is being read. I also made sure to include more detailed information on professional requirements for my staff, monetary allocations to the marketing program, revenue generation and profit per sale.

10 Key Components Investors Are Looking For In Your Business Plan

          Tim Mathews acts as director for Research PE India and is actively involved in business modeling, corporate financial advisory, start-up funding, and mentoring entrepreneurs. Mathews received his B-tech from Indian Institute of Technology Madras in mechanical engineering and an MBA in Finance & Entrepreneurship from Washington University. Before he founded Providence, he worked for Emerson Climate Technology, GE Consumer Products and Satyam Engineering Services. Mathews has experience in competitor acquisition analysis, systems engineering, product strategy, product sourcing and product design. In other words, Tim Mathews knows a thing or two about how businesses operate and what it takes to make them successful.

          In his NEN Webinar titled, “How To Write A Business Plan”, Mathews explains that the number one reason to make a business plan is to raise funds. To do just that, Mathews points out 10 critical items in a business plan that investors are looking for. Above all, investors will want to know if the business idea is feasible. You don’t have to be the first person to offer a certain product in a certain market but you want to convince investors that your business plan addresses a need in that market. The second item that investors look for is owner and team credibility; investors want to invest in team players with a heavy hitter mentality – passionate individuals who will focus on execution and not quit when the going gets tough. The third item has to do with having a stable business model. This requires much thought and must backed by solid qualitative and quantitative data.

          Number Four: market size, scalability and opportunity. If there are too many businesses competing in the same market, there is little room for opportunity. A scalable business makes way for an investor’s exit options. Number five is the validation of business and revenue model. Have you already tested the waters with potential customers or clients? If they are taking product for free more than they are paying for it, investors may want you to return at a later time if you fail to show the product’s attraction. Number six: investment return. This is pretty straightforward; investors want to know exactly how much they are going to get out of what they put in.
          Seven: competition and other risks. Every business has risks and competition at different levels, and they’re not necessarily a bad thing, but investors will be wary of investing in somebody who does not have a clear-cut plan for identifying the competition and mitigating these risks. Eight: execution is everything. An investor can look at the rest of the business plan and be drawn to it but if there is not a plan for execution, they are going to look at you and question what the end result is going to be. Nine: market position and profitability. You have to be able to convince an investor that your business model is strong enough to guarantee them a solid return on their investment based in your current position in the market. Finally, exit options are ways in which current investors can exit. Investors will be looking for ways that you address an exit strategy once they’ve spent their valuable time and resources assisting you in your business venture.