It is not that every business proposal meets with interest from
venture capitalists. But when a venture capitalist or angel investor shows
interest in funding a new concept business, the entrepreneur has got to be ready
for the meeting.
An entrepreneur needs to have a final, airtight version of the business plan ready
before the meeting with the business investors.
The plan needs to be concise yet comprehensive in scope and provide enough details
to satisfy the questions of investors.
Sometimes, an
entrepreneur may need to prepare more than one business proposal for the
new business idea. Business investors such as banks require prefer business proposals
that provide details about the financial outcome of the venture.
on the other hand prefer business ventures with unique ideas.
Venture capitalists look for the strength of the ideas as well as the strength
of the management team when they go through business proposals.
An entrepreneur seeking to raise capital
for a best new business also needs to provide a personal financial statement of
current income and past income. Usually, business proposals include personal disclosure
statements over a three year period.
In the financial section of the business proposal, the entrepreneur also needs to
highlight the entrepreneur’s extent of investment in the project. A business investor
likes to see that the
entrepreneur also has some personal stake in the project.
The financial section of the business proposal should also contain details about
how the business venture will pay the money
back as well as a roll-out schedule for the repayment. If the entrepreneur is getting
seed funding from more than one source than all the sources of funding need to be
mentioned. A business investor likes to see who else is investing in the project.
Before meeting with a business investor, the
entrepreneur also needs to make sure the management team is completely in place.
If the entrepreneur cannot bring these key people to the meeting, signed letters
from them agreeing to take certain positions in the company is required.
Finally, the business proposal needs to contain information on the supply and demand
for
new business.