For Practical Business Results
Applying for business finance requires that you prepare a bankable business plan. However you don’t just prepare a business plan before checking out if funders will be interested in funding your business idea. You’ve got to determine if potential funders or investors will be interested. The other time I was working on a business plan for a client in the construction industry. I had identified the Independent Development Corporation (IDC) as a potential funder, I therefore used their business planning guidelines to prepare my client’s business plan. I got the shock of my life halfway into completing the project. In a casual chat with someone from the IDC, I was told that IDC stopped funding this sector.
Oooops, what a shocker!
I had to start all over again. I had to identify a potential funder and customise the business plan to their requirements. You don’t want that happening to you, do you? It wastes time.
What then are you supposed to do?
The correct procedure is to determine if the funders you have identified actually operate in your field. Secondly, you have to find out if they are interested in considering you for business finance. To do this, you need to prepare an executive summary, some people also call it the business case or the concept proposal and present it to them either in person or by email.
Now, you may think this is costly. Not at all, it just requires that you apply your mind and really answer some questions about your business. Structure your executive summary using the structure below and answer each and every question in each section.
1. Concept Overview:
• What is the business idea?
• What does it do?
• What important problem are you trying to solve with your business idea?
• What opportunity have you seen that you are trying to get into?
2. The Solution
• What is the solution that you are providing to solve the problem?
• How are you tapping into the opportunity?
3. Your Target Market
• To whom are you trying to sell?
• Why are you choosing these customers?
• What do you know about your potential customers?
4. Your Business Model
• How will your idea make money?
• Does the market have the potential to grow?
5. Underlying Magic
• What makes you special to solve the problem or to exploit the opportunity?
• What similar products are in the market space now?
• How is your product different?
• What makes your product unique?
• What compelling reasons exist for why your customers need your product or service?
6. Your Marketing Strategy
• What is your go to market strategy?
• What marketing and sales strategies are you going to use?
7. Your Competition
• What can you do that they cannot?
• What can they do that you cannot?
• What the major mitigating milestones?
• Where are you with respect to each one of them?
9. The Fit
• Who are you?
• Why do you fit with this idea?
• What inspired you to come up with this idea?
• Who is on your team?
• Why are they special?
• Do they have relevant experience?
• Are there any demonstrated successes that they can show?
• Their qualifications?
10. Financial Forecasts
• What are your sales forecast for the next 12 months?
• And for the next 3 years?
• What are your overhead costs?
• What are your gross profit and net profit margins
• What assumptions and metrics are you using to achieve these projections.
Spend a few days on this very important task because you are laying the foundation for a successful small business finance raising campaign. Your business case must be two pages or less. Executives are busy people, don’t bore them with descriptive information, instead, sell your business idea.
Contact me anytime if you need advice. It’s FREE.
Chief Executive Officer
TMK Small Business Consulting
2743 722 6661 (w)
2772 087 8510 (m)