To win over investors you need a great business plan. Here are the five things you need to succeed:
Show off your successes
Investors look to your company’s and your executives past for indicators of a successful future. If you’ve been funded before, demonstrate how you responsibly used the funds to grow your company, hit or exceeded operational benchmarks, created a solid foothold in your market, and made a solid return on your investors funding. If your company is new, show how your executive team has created successful new companies and sustained them.
Show that you know your market niche.
In today’s market, niches are critical. If your business is a part of the $1 trillion healthcare industry, for example, it must focus marketing its products on a specific element of that industry, such as networking supplies for family practices on the East Coast. In this example, your business competes in business services, telecommunications and electronics. This creates a niche, which helps maximize your marketing efforts. Knowledgeable investors want to see that you know your niche.
Demonstrate your knowledge of your customers, what they want, and how you’ll provide it.
Investors see businesses in terms of the relationships they develop with their customers. Your business plan should explain why your company is the best choice for meeting a specific, unfulfilled market need. Your business plan must also outline how your product will get to your customers, along with a specific timeline. If your business can’t reach customers, it can’t make money, and neither can your investors. Show your investors how you plan to build a relationship with your customers.
Explain how you create customer loyalty and overcome your competition
Telecommunication companies bundle their services, so if you purchase one product from them, you’re offered one or more products at a discounted rate. You also don’t need to pay additional installation fees, and that keep you locked-in. Great customer service and products are other examples of locking in customers. If your customers are locked-in, competition can’t get to them. How will you lock-in your customers? Your investors will want to know.
Show realistic financial assumptions
Reasonable financial projections show maturity on the part of you and your executive team. Some investors will only look at the financial section of your business plan, so it should be completely realistic. Your operating margin, revenue per employee and market penetration should all be sound and consistent, which will earn the trust of your investors.