Creating a Successful Business Plan For Your Company
22 June 2018
The What is the most important factor you should recognize when writing a business plan?
A business plan is a vital tool to allow companies to connect with potential investors. A well-written plan will be crucial to whether investors will interview your company. To ensure your best chance at success in raising venture capital, we have compiled a list of what to include in a seamless business plan.
Executive Summary 0f Creating a Solid Business Plan
The goal of the executive summary is to encourage the investor to learn more about your business.
Capture their attention – The executive summary will be the first thing your potential investor reads. You should be able to entice them and ensure that they keep reading.
Keep it short & simple – Investors are flooded with business plans every day. Try and summarize your business as best as you can within two pages. You can focus on the minute details later in the business plan.
Write it at the end – If you build your business plan around what you planned from the beginning, you will be building it around incomplete knowledge. The executive summary should be written at the end after you have a clear vision of where you want your business plan to go and therefore make it more persuasive.
Company & Industry Analysis
The company and industry analysis is crucial to educate the investor of your company’s history and the current climate of the market you plan on targeting.
Show your past – Give the investor a timeline of your company. Present them with your achievements, goals and demonstrate why your team is unique in the industry. Details should include your company’s state of development, partnerships secured, and past funding rounds.
Demonstrate the need – Prove to the investor that there is a real market for your product or service. Explain what makes your company and product/service unique within the industry.
Be credible – Any legitimate investor will conduct extensive research on your company before investing. Ensure that your research and data is verifiable, along with your company’s track record.
Embrace negative trends – Always be one step ahead of the investor. Present the challenges that are occurring within the industry and show how your company will overcome them. This will help eradicate any concerns that the investor may have about your business and put your company in a more credible light.
Have a Plan for Raising Capital – always be prepared to answer questions regarding your main strategies for raising capital, because often investors are keen on knowing if you have a plan B in case your main strategy doesn’t work out for whatever reason.
This section will give a detailed description of your product or service. It will demonstrate how the product/service will add value to your customers and satisfy your customers’ needs.
Define and detail your customer and demographic – Be specific on your target audience for the product. Will you be focusing on B2B or B2C? Include as much as you can, everything from your audiences’ age to their socio-economic background.
Competitive advantage – List the competitors that your product/service has within the industry. Claiming that your company has no competitors will undermine the demand for your product/service and therefore the credibility of your plan.
Conducting macro and microenvironmental analysis will give the investor an overview of your market.
Follow the PESTLE guidelines – The Political, Economical, Social, Technical, Legal and Environmental guidelines will fully analyse the wider current climate of the sector you are targeting.
Examine the market forces – Examining competitor threats, the intensity of competitive rivalry and the bargaining power of customers and suppliers will be essential in planning how your company will operate.
The marketing plan will detail how you plan on entering the market and successfully deliver your product/service. It should also include how you can retain your customers.
The 8 Ps – This marketing mix consists of Product, Price, People, Physical evidence, Processes, Productivity, Place, and Promotion. It is uncommon for all eight elements are used, so focus on the sections that are most relevant to your product/service.
Customer retention plan – Detail how you aim to retain your customers to ensure that the investor has security and trust in your product/service.
The operational plan will be your company’s plan of action. It will outline everything from the daily operations, equipment, quality & inventory control, supply chain requirements, and product development.
Focus on reality – The operational plan will turn the ideas that have been concepts so far, into a reality. It will show the investor what they expect to see once they invest and how you propose to execute your plan. Be concise with every step, to show the investor that you can thoroughly execute your concept.
Be consistent with business milestones – Present your company’s long-term business milestones and how your team will execute them. Make sure that the milestone projections are consistent and align with your company’s financial plan.
The financial plan is core to your business plan, as it will show the investor how you plan on generating a return on their investments. It will provide a detailed analysis of the expected costs and revenues and the predicted growth potential of your company.
Transparency in use of funds – Investors need to know how you will utilize the funding you are requesting. Be transparent and create a plan of where you intend on allocating their money, whether it be to staffing, marketing or technology development.
Show your revenue streams – Explain all of your revenue streams, such as the revenue garnered from sales, referrals, advertising and data.
Provide an exit strategy – Investors want to see your commitment and motivation in building long-term value. Provide examples of companies within your sector that have exited successfully.
The people behind your company will be fundamental information for investors as the management and organisation is the heart of the business plan. You should include the names and roles of the people behind your team to give the investor a clear vision of the people they are putting their money behind.
Opportunities for You
There’s a wealth of information on how to develop an impressive business plan online, but 90% of that advice comes from people who did not invest decades of experience nor they have been in the “trenches” actively networking with investors like we do, therefore, if you need more information on how to write the perfect business plan, seek for investors or raise series A investments visit our website or request a one-on-one consultation with our Head of Funding, Chris Burns, below:
Phone: 0207 096 1157