California Investment Network

Business Plan Tips

What Investors Are Looking For In A Plan

Investors, whether angels or VC's, are looking for the same things when reading a business plan. They want to know how big the opportunity is, whether this is the right team to exploit the opportunity, who the competition is, what the risks are, and why they can expect this team to implement successfully. Your job in writing the business plan is to address these questions convincingly and clearly.

Emphasize Your Real Strengths

Highlight what your team brings to the table. If your business hinges on a particular competency (for example, understanding the procurement process), your plan will be more persuasive if one of your team members knows something about it and that is brought out in your plan. Rather than including generic resumes of team members, tailor the resumes to draw out the experience each member has that will make him or her a valuable contributor.

Get To The Point And Make It Clear And Comprehensive

Investors see many business plans. A 20-page plan which clearly lays out your business is far more likely to be read than a 100 page plan. Today, some entrepreneurs are using a 15 slide Powerpoint presentation. If your text is short and punchy, you won't need to repeat yourself, because the reader won't be bogged down keeping ten chapters in their head. Reading the same thing over and over, even if it's in different words, can get really tiring. The more you use brevity and give each concept a single home in your document, the more people will want to read it.

Write In Plain English

If you can't explain your idea in English, either you don't understand what you're talking about (What is a transaction enabled atomic journaling database server, anyway?) or you haven't simplified the idea enough. Think, revise, and try again.

Get Rid Of The Hype

Yes, we know you will be the "premier insert product category here of the Internet, achieving 99% market penetration with 60% customer retention in 3 months". Your product will reach "new heights in customer experience through the use of personalization and one-to-one profiling and customization". It will be "user friendly" because you will be creating a truly "ecstatic customer experience". It is a "quantum leap forward" in the marketplace for product category here. Um, yeah. Believe me, we've read it before. About a dozen times today, in fact. (And by the way, the phrase "quantum leap" really doesn't mean anything.) Stick to a tight, simple explanation of your idea. Convince your reader you'll be the best because your idea is the best, not because you can string a dozen buzzwords together.

Use Quantifiable Information

In each section, back up your assertions with solid facts. Even if you are a new venture and cannot give specific figures on the performance of your business, quote figures for the industry or your competitors. These real figures carry more weight than your assumed projections and give more reality to your plan.

Choose A Huge Market

Especially in the internet world, investors are looking more at the market than at the detailed specifics of your financials. Choose a market that is big enough to be an obvious good opportunity. A business which targets teenage girls who listen to music and has a reasonable chance of capturing 90% of the girls that are online is a huge opportunity. A business which targets net-savvy SAAB mechanics who need prosthetic limbs is not.

Local Investors

United States > California

I am an investor looking at around $50,000 to start and up to $100,000. This is cash available looking for an interesting, probably upstart company with a good idea who needs money to get going. My preference would be an investment with good return that has the possibility of rolling back over into the company for future development and returns. As further background, I am looking to invest in areas other than stocks, funds, etc. My net worth is approximately 1.4 million of which most is in land in Arkansas.

$0 to $100,000

United States > None

Seeking

$50 to $500

United States > Kansas

I run a website and e-commerce development company and have years of experience in website development. I am looking to invest. I invest by providing resources required for building, testing and supporting your website or web services. I am interested in start-up companies. I invested in one company in USA in similar form and want to expand my investment

$10,000 to $100,000

United States > Maryland

I'm an attorney with the U.S. Environmental Protection Agency considering retiring and moving to California where my daughter is. She is a recent college graduate with marketing and music management experience. We are looking to be associated with an existing nightclub seeking expansion (by "we" I mean "her" with my money). I will have about $300K to invest upon moving, about $50K right now.

$10,000 to $50,000

United States > Minnesota

My firm has helped raise over $200 million in non-dilutive capital for companies over the last 9 years. We specialize in finding cash grants from cities and states that are willing to invest in your product, idea and existing business as long as you move the labor intensive portion of your business to their city. In order for you to qualify you must be able to create 100 jobs over a 5 year period and be able to move the business to a state that is willing to invest in your company.

$500,000 to $100,000,000

United States > Oklahoma

Stocks, Real Estate Private Investor Senior Level Manager

$100 to $1,000,000

United States > California

Past investment history includes Oil and Natural Gas investing and Real Estate sale and purchaces. Currently employed as a commercial insurance broker for global risk management firm. Interested in opportunities as private investor.

$20,000 to $80,000

United States > Nevada

I originally began doing seed deals in the 1980's in Silicon Valley. I graduated into professional venture capital and worked in that capacity for many years. Left the VC field and went to work for one of the funded companies. Started my own software company in 1996. Sold it in 2002. Started a financial service company in 2004. Offered a broad spectrum of financing programs to small and medium sized business. Recently began to represent a private investment group located in Southern California.

$500,000 to $5,000,000