The Tale of Two Business Plans...

This is the tale of two business plans. They both arrive in the morning mail neatly bound. Each lands on the desk of a potential investor who has but only a few minutes to scan the new arrivals.

The first plan is tightly bound with a thick cover. On the cover are the company's name and the owner's contact information. As the investors tries to open the plan, the cover won't flip and stay open. While wrestling with the document the phone rings. Having diverted one hand to pick up the receiver, the investor must now fight the document with one hand.

After eventually prying open the cover, the quick handed investor places a nearby coffee mug on the corner of the cover to hold it down only to find the first page is a standard confidentiality agreement. So the battle begins again to flip and hold open the next page. After some contorted efforts to flip open the confidentiality page and slide it under the mug, the exhausted investor finds a table of contents page.

At this point, the investor is reminded of the caller on the end of the line. Not wanting to be rude, the investor apologizes but continues on with the document challenge at hand. Finally, a page titled "Executive Summary" appears. Anxiously the investor scans the page only to see an endless ocean of words and headings like "The Company," "The Market and Industry," "Business Model/Strategy" and so on. Not wanting to be rude to the caller any longer, the investor decides its best to put this document aside for later review...

The second plan is neatly bound with a binding that allows it to flip and stay open. The cover is divided into two columns. The left column is about five inches in width. It contains a brief headline that captures the essence of the business. After the headline is an outline of the business with concise one paragraph summaries on the company, management team, products/services, funds requested, collateral, use of proceeds, likely exit, and a small table of financial projections. The column on right, about two inches wide, identifies the stage the business is in and its primary industry or market followed by contact information and a table of contents. All on one page with plenty of white space. Click here for an example.

As this investor attempts to read the plan he too receives a phone call. With one hand on the receiver the other simply holds the plan. As the investor scans the document he quickly knows whether or not this business meets the firm's investment criteria in terms of market focus, business stage, and deal size. Circling a few key elements on the cover the investor forwards the plan to a colleague with a note requesting the plan be reviewed further...

Let's say that this business plan didn't fit this firm's investment criteria. What would happen then? Well, because the investor was able to quickly glean some good insight into the company and business it may bring to mind another investor that would be interested and the plan could be forwarded on to that person.

Remember, investors are typically very busy people; often juggling more than one major project or deal at a time. Laying out your plan in a way that fits into their schedule and work style increases your chances of funding.

To your success,

Mike Elia

Did you know you can sign-up for the F R E E Business Plan Secrets Revealed! Four-Part Mini-course and get tips on how to:

- build a case for your business that leads investors to conclude that you are the obvious investment choice

- write a business plan that captures investors’ attention

- find funding sources.

You'll get Part 1 immediately after you register and the remaining three parts over the next three-day period.

If you enjoy The Capital Minute forward it to friends and colleagues. It comes to you monthly from financial and marketing consultant Mike Elia, author of

For free business plan or funding tips, click here to subscribe: