The obvious goal of the business plan is to receive resources for the company. Most entrepreneurs focus on it, and other aspects which may prove useful in further development of the company – such as the planning function of a business plan – stay forgotten. When advertising expenditures, wages or product prices are changed, financial, liquidity, and capital requirements planning also change accordingly – not only for the current period, but for the future.
In the first place, the business plan should convince investors to provide funding for the project. In the next stages, it can also be used as the benchmark by which to measure the company’s success. This applies not only to investor perspectives but also the company itself.
Contact the investor but be well prepared
Before looking for the investors, one should be fully aware of how and where the funding will be used. Analyzing the topic in detail – especially developing financial statements – every entrepreneur has to be prepared for the questions that will be asked sooner or later. An experienced and knowledgeable Investor (e.g. bank) will ask exactly those questions, and this is why it is wise to have the answers ready in advance. Remember: you will have no second chance to make a first impression! We have had cases where people used templates for their business plans and eventually, after negative indications, turned to us for guidance.
Uncalculated analyses and arguments lead to uncalculated results. Only the structured and well thought-out ideas attract the attention they deserve. Not every entrepreneur with valuable ideas has a chance to develop them, because investors may not be so enthusiastic about it. It takes substantial preparation and presentation skills to succeed.
Tips to help you to convince
There are many situations where you need to persuade someone. It may be a new potential customer, or an investor. With appropriate analysis, graphics and illustrations, any idea can be sold much better. The visual effects and the representation make about 80% of the overall impression.
- Make sure your business plan is complete. As mentioned earlier, investors and banks will ask you the questions from the list, and you don’t have a second chance. You should check the details of your business plan twice, or even three times. A well-written and thought-out business plan considerably increases your chances of receiving funding.
- Place a premium the on executive summary and presentation (including financial statements) included in the financial part of the business plan. Should these components be inconclusive; the investors will not bother to read further.
- Be prepared for new inquiries or more details. It goes without saying that a business plan should include information that the investor wants to see, but be ready for the unexpected – and plan it. When you are ready to expand your plan with new information, you prove competence. With integrated financial statements, you can quickly change your inputs and insert new rows if necessary, to easily update your data.
Other interesting articles:
- Financial Planning Under Uncertainty: Convincing Investors
- Financial Planning: Typical Mistakes of Start-Ups
- Optimizing Strategy Through Financial Planning
- Financial Planning For Analysing Capital Requirements
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