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Frequently Asked Questions About Business Plans
Seven of the most "Frequently Asked Questions About Business Plans" that I'm often asked...
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1. Why do I need a business plan?
2. What needs to go into a business plan and which section is the most important?
3. Should I use business-plan software to prepare my plan?
4. What's the recommended length for a typical business plan?
5. What pitfalls should I avoid in preparing my business plan?
6. How do I find investors and convince them to look at my business plan?
7. How can I best set my own investment opportunity apart from the competition?
Subit your "Frequently Asked Questions About Business Plans" to me through the form below.
Answers to Frequently Asked Questions About Business Plans:
1. Why do I need a business plan?
Anyone who is contemplating investing in your business, whether a bank, capital fund or private investor, will ask you first for a formal business plan. How you pitch your idea or business plan to them will determine whether they will see your business as any better, worse, or different from all the other investment opportunities they are evaluating.
It is up to you to bridge what I call the “Investor Confidence Gap.” This is the gap that reflects an investor’s inability to resolve whether the investment they are reviewing is any better or worse than the others.
The best way to bridge this gap is to present a detailed and comprehensive business plan or prospectus that states a case for your business quickly. This case must separate you from other businesses seeking capital and truthfully lead investors to decide that you are their most appealing investment choice.
2. What needs to go into a business plan and which section is the most important?
Business Plan Secrets Revealed includes a seven-page table of contents for a typical business plan. The two most crucial sections of the plan are the executive summary and the financial data. If the executive summary is not clearly written and does not spark interest in your investment opportunity, then that’s it – no one will read further. If the executive summary passes muster, then investors usually look next at your numbers. If these look appealing and credible, they may then read the plan as a whole and think about whether or not it fits their personal criteria for investing.
3. Should I use business-plan software to prepare my plan?
Business-plan software can help you get organized and even help you prepare financial statements. However, investors are distinctly unimpressed by a business plan that looks like you used a fill-in-the-blanks template and that looks like nearly every other business plan they’ve ever seen. Instead, they’re impressed when your business plan fits your unique circumstances and includes as much relevant evidence for your case as you can possibly put together.
Business Plan Secrets Revealed explains in great detail how to build your case carefully, credibly and completely.
4. What's the recommended length for a typical business plan?
Investors get swamped with information and business plans every day. A concise, clear, and comprehensive 20-page business plan is more likely to get read than a 100-page plan.
Question the need for repeating information. Reading the same material two or three times bores and even troubles readers. In fact, most skip over paragraphs if they think they’ve already read them.
Cut down on repetitive paragraphs or sentences, and you’ll not only earn your reader’s gratitude and attention, you’ll reduce printing and mailing costs.
5. What pitfalls should I avoid in preparing my business plan?
The business plan plays such an important role in getting funding that it’s just about impossible to take too much care in putting it together. As someone who has reviewed and evaluated hundreds of business plans, I find that the most important pitfalls to avoid are these:
- unclear writing or prose that takes too long to get to the point
- financial numbers that have no credible foundation
- confusing charts and graphs
- inadequate research, such as a claim that no one has done such-and-such when a five-minute Internet search turns up someone doing just that
6. How do I find investors and convince them to look at my business plan?
The cheapest way to find investors is to research them on the Internet. This will take forever and probably frustrate the dickens out of you. Your public library may carry a directory of private sources of capital, which is also free but cannot be checked out. You can also hire a consulting firm to develop a custom list of potential investors or buy an investor database. Once you have a list of appropriate investors to approach, you must carefully consider the best way to approach them. Some prefer email, while others look only at business plans that come in the mail.
7. How can I best set my own investment opportunity apart from the competition?
A clearly written, well-organized, no-extra-fat business plan with solid numbers that is sent to investors who are interested in its type of investment opportunity has the best chance of making it to stage two, in-person meetings with investors.
Business Plan Secrets Revealed gives you insider tips on how to ensure that your business plan survives the rigorous screening process of investors. Get your copy today!
Remember to e-mail your "Frequently Asked Questions About Business Plans" to me at faq@business-plan-secrets-revealed.com.
You'll also find answers to other Frequently Asked Questions About Business Plans in my Free Business Plan Guide. When you request the guide, you'll also get access to all my special reports and a subscription to my Capital Minute ezine at no charge. Take advantage of these resources to get ongoing answers to all your frequently asked questions about business plans.
Use the form below to submit your "Frequently Asked Questions About Business Plans" to me.
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