You may have arrived at the stage in your business where you need capital to grow, and you’re looking at how you might obtain it. 

There’s a lot of noise out there about what needs to go into a business plan for an investor. You might be shocked to hear that we don’t advocate a lengthy and detailed investment plan. On the contrary, we advise our clients to break their plan down into a concise framework of smaller steps, in order to deliver a dynamic investor pitch. 

You may know you have a brilliant business – but you’re going to need a plan that answers the kind of questions an investor will be asking. There are some key areas you always want to address when it comes to an investor pitch.

Here are our Seven Steps to follow to ensure that your business plan is investor ready:

Step 1: Write an Executive Summary

Your executive summary is your gateway, and a key solution to grab your investors’ attention. It is a vital tool for you to show your business so investors can determine whether your model matches their vision. The purpose of the summary to give an overview of the key points your investor is going to read in the plan, and entice them to read on. 

Step 2: Research your market

It is important to have a large potential market for your product. Although market sizing is hard, understanding your addressable market can be an exciting prospect for an investor. Who will be generating the total revenue for your product and service? Research your market and explain:

• What are the demographics of your market?
• What are their purchasing habits? How do they make decisions? What are their motivations to buy?
• How will you address those habits?
• What potential changes to do you see in the market?

Knowing the characteristics and habits of your target market will also be valuable for your own marketing efforts. 

Step 3: Define your Solution

This is where you talk about how you solve the problems your market is facing. How will it make their lives better, easier, more efficient. Your solution is the application for which your product or service was designed. It includes parameters like uniqueness and competitor analysis and is what adds value to your product. 

Step 4: Clearly present your go-to-market strategy

For your ideal market strategy, you need to clearly define your Ideal Customer, Marketing Goal, Timeframe, Budgeting and Objective. This will establish a basis with the investor about how you are looking to push your product and services out. 

Step 5: Prove you have the right team in place

This is the part where you talk about your people. It’s where you showcase the team who will be delivering the plans which have been laid down for your product or service. Make the investor believe that this is the strongest team with the right experience to develop and execute. 

You’ll want to identify the number of staff you have, and where you plan to outsource. You may even want to talk about your own background and skills. 

Step 6: Lay out your financial projections

The financial section of your business plan aims to show that your business is viable, in order to attract investors. 

Based on the market research carried out in Step 2, it’s important to determine what the supportable assumptions are which need to be made and how these will translate into financials. Based on Step 4, it’s critical to look at how much funding will be needed and when, with a clear view on application of funds.

The financial section will usually refer to three crucial financial statements: the income statement, cash flow projection, and the balance sheet.

Step 7: Highlight governance

Emphasizing on governance is not something you see in a lot of investment plans, but it is good to highlight control and communicate framework to the investor as it will drive the credibility and mentality of the organization. This will help investors who are more risk averse to gain confidence. 

These are the fundamental steps to be included in your plan. Remember that investors will see plenty of business plans and will know what they’re looking for. Make sure all of these points are included to have a better chance of making an impression. 

Accountants are often the best people to come to for advice on finding the right investors – so please do get in touch if you need help perfecting your plan, or you’d like some support on approaching the right people. We want to see you succeed and we’re always here to help!