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.

Registered Investors

United States > California

Private Investor with a background in banking.

$0 to $50,000

United States > California

Seeking qualified investments. 25 year carreer in accounting and corporate finance. Have held the roles of COO and CFO. Started my career as an investment advisor with American Express. Current portfolio includes stock investments as well as angel investments in Tech and Real Estate related companies. Looking to further diversify portfolio.

$0 to $1,000,000

United States > California

I am a private investor looking to find an opportunity where I can help people and and make a profit along the way. One of my ultimate goals in life is to invest in a high-risk company on a new frontier yet to be discovered. Looking to start out as silent partner but willing to become active member as time goes on.

$5,000 to $15,000

United States > Illinois

Work for one of the largest privately held real estate companies in the country.

$50,000,000 to $750,000,000

United States > Georgia

A trust with assets in excess of $5 million, income exceeding $200,000 in each of the two most recent years or joint income with a spouse exceeding $300,000 for those years. Looking for investment opportunities.

$50,000 to $100,000

United States > California

This group comprises operationally experienced investors with diverse backgrounds ranging from software development (multi-exit entrepreneur) management consulting, private equity and the U.S. Marine Corps. We are a private equity group targeting profitable small businesses where we can partner with existing management to execute transactions including partial/full equity recapitalization, management buyouts, and in select cases growth equity investments. We seek to serve in an advisory role and provide strategic guidance and financial resources to small businesses that have the potential to grow.

$20,000 to $3,000,000

United States > New York

Our firm been investing equity in profitable, established businesses for almost 40 years. Particularly, Companies seeking growth capital or Owner's seeking to sell a portion of their business for liquidity or estate planning purposes. Investments are typically in companies with $3MM-$15MM in EBITDA. We seek to partner and grow businesses, typically making an acquisition within the first 12 month's of acquiring a business, while also developing a strategy for further organic growth of a business. We are generalists and look at areas such as manufacturing, industrials, specialty chemicals, business services, auto, aviation, unique consumer products, and specialty contractors with low bonding requirements.

$3,000,000 to $15,000,000

United States > California

I am a private investor. My professional background includes equity research (large and mid-cap stocks) at a private investment boutique, a position at the debt rating agency Moody's Investors Service, and most recently project finance with a focus on the renewable energy industry. I am a CFA charterholder. My career skills development has been oriented towards buy-side investing and I wish to employ these skills to put some of my own money to work.

$1,000 to $50,000