- The 5 Things Investors Really Care About When Reviewing Your Business Plan - November 3, 2021
- How to Create a Fundable Business Plan - January 4, 2021
- The Entrepreneur’s Guide to the Modern Day Business Plan - August 30, 2019
Every entrepreneur or business owner knows they need a business plan to raise money. What most don’t know, however, is the kind of plan that attracts funding. Such business plans have one element that others don’t: they focus on marketing.
Those business plans that are written as marketing documents are often the business plans that attract funding. Rather than being written as lengthy tomes that answer every question an investor might have, they convey less information in an efficient manner, making their company more desirable to investors.
An analogy that fits well here is the difference between an automobile brochure and the owner’s manual. An owner’s manual is lengthy, often hundreds of pages. It answers nearly every conceivable question you have about the car. Rarely will a prospective owner request to see the manual before purchasing, although they might ask the salesperson some questions that are answered in it.
Conversely, the automobile’s brochure tends to do a great job of marketing the car to the buyer. It talks about key features and benefits such as acceleration, comfort and safety. It’s the brochure and information in it that sells the prospect on purchasing the car.
Likewise, your business plan should be more like a brochure than a manual. While it shouldn’t be a four-page glossy document, it also shouldn’t be a 50-page manuscript.
Below are additional keys to help you create a winning business plan.
15 key business plan questions
Answer each of the following questions in your business plan. In doing so, think about the brochure versus owner’s manual analogy.
- What does your business do?
- What is it about your business that makes it unique?
- What has your business accomplished to date?
- How big is your market and what trends are positively affecting it?
- What products and services will you offer?
- What customers will you serve? What are their demographics? How many are there?
- How will you attract customers?
- How will you create barriers around your customers so they purchase from you long-term?
- What competitive advantages do you have?
- What are the key operational processes that will allow your company to successfully grow?
- What company goals have you set and what are your projected dates for achieving them?
- How much funding do you need to grow your business?
- What are the potential returns for investors?
- Who is on your management team? What are their backgrounds and accomplishments?
- Who might you need to hire in the future to achieve your goals?
Armed with this key information, investors can determine whether they want to meet with you, which is the equivalent of a test drive in our automobile analogy. During that meeting, they can ask you additional questions not answered in your plan.
Use a business plan template but not a sample business plan
In creating your business plan, there’s no need to reinvent the wheel. A good business plan template will include the key questions your plan must answer like those listed above. It will keep you focused on marketing your business in your plan, and avoiding unnecessary information that wastes your time and turns off investors.
Conversely, using a sample business plan makes it harder to show how your business is unique, and it is your unique attributes that often result in your success.
Most newspapers and magazines (and automotive brochures) write at a sixth-grade reading level. Even though many investors are extremely savvy, if you write using long and sophisticated words, it makes your message harder to comprehend.
Put extra focus on your first page
The first page of your business plan is your executive summary. On this page, you must answer the first three questions listed above. If investors like your answers, they’ll continue reading. If they don’t, they won’t. So, spend extra time creating concise and compelling answers to these key questions.
In summary, treat your business plan more like a marketing brochure than an owner’s manual. In doing so, you will get more investors and lenders interested in your company, and increase the ease in which you’re able to raise funding.