I hope you are well.. I’m wondering if you are looking for Outside Funding, if yes, this could help:
When thinking about writing a business plan in order to achieve outside funding from venture capitalists or angel investors, you should keep in mind the fact that the section that is generally disregarded by entrepreneurs, the one of the management team, is actually the most important section for the investor. You may have the impression that the business idea or the amounts of money you have or you need are more important, but you are wrong.
One of the first arguments we will provide is the one of Key Man Insurance. You may not know it, but investors ask entrepreneurs to insure their key man for the business after signing the deal. This only proves that the persons working for a project are more important than the project itself. Because a good idea cannot become reality unless it is ran by capable persons. Even if it’s difficult to believe it, investors most commonly fund persons, not projects. Of course the idea is essential, but, unless it has a powerful management, it will most likely be discarded. Good managers not only have the know-how in a specific area of activity, they also have the capacity of collaborating well with people. They are able to run a team in the most satisfactory way. This is the most powerful card you have when submitting your business plan to an investor. Because the right team and a valuable idea you can help you reach the imposed target. But, a less capable manager with a great ide a is one of the shortest ways to disaster.
This is why you should include a very detailed description of your management team in your business plan. You should write information about the previous work experience of your managers, about their qualifications and current responsibilities, about their education, awards and certificates and about the ways in which they have been involved in your community by that moment. By doing this, you can offer a guarantee to investors about the quality of your team and about its possible accomplishments.
Moreover, you should also think about a backup plan in case one of your essential managers is out of the office for a shorter or longer period of time. This means being able to provide training manuals for the eventuality of somebody taking over the tasks of one of your managers, a hiring plan that can allow you to recruit and train new efficient personnel, and never stop networking about the terrific work environment you provide in order for you to be sure that there will always be a constant amount of demands for jobs in your company.
Another aspect you should think about is whether or not you will be one of the managers. There is a visible difference between the person who runs a company and the person who founded it. And, if you don’t have the necessary expertise as to run your business properly, than you should let somebody else do it. Mentions about how the company will be run are also elements to be mentioned in your business plan along with your strategic direction.
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The thing you should not forget is that there is a huge difference between venture capitalists and angels as it is only venture capital firms that provide external management for the funded project whereas angels only rarely get involved in the running of the businesses they fund. But this doesn’t mean that either of them will do anything else first besides checking the management section in your business plan.
All the best,