May 3, 2006

What Investors Want….The More Info the Better.

Entrepreneurs need to remember two important facts. First, investors want answers to the question they have. Second, investors want clear and concise answers to these questions. If you want an investor to envision your business idea the way you do, then you must make sure you have all of the necessary pieces of information. The pieces need to be laid out into a thorough and to the point business plan.

There are several things investors want to know about your business idea and you need to be prepared to answer any question any investor might have. The following are questions investors usually want answered:

  • Who are the members of your management team?
  • What traction do you have? (i.e.  Have you generated revenue?  Do you have customers?  Have you developed the product?)
  • Is there a good market opportunity?
  • Does the business plan show a detailed understanding of the potential customer?
  • What is the unique offering behind the plan?
  • Does the overall business model make sense?
  • If they exist, how does the company plan to displace firmly established competitors?
  • Have advertising, promotion, distribution channels and sales strategies costs been assessed and approaches tested?
  • Are the capital requirements, growth, and profitability reasonable?
  • Does the team have specific knowledge and experience that make them appropriate for this venture?
  • Does the plan show attention to detail and form (correct spelling, grammar, and punctuation; good organization)?

You need to make sure you incorporate detailed answers to these questions into your business plan. (Generally, length is not an accurate indicator of whether all areas have been sufficiently covered.)   In short, an information packed-business plan should contain information about market, customers, sales, product/service offerings, info about the management team, description of the competition and financial summary of business idea.

At FundingUniverse.com, we have recently updated the questionnaire on the Business Plan Summary.  It is highly recommended that you login to your account and update your profile to include the new information.  Remember, the more detailed you can be in answering these questions the more likely an investor will invest.




blog comments powered by Disqus