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Five Elements Investors Look For In Your Business Plan

Business plan

The importance of writing a business plan has been a major discussion topic among entrepreneurs and investors. Many say that the entrepreneurs should have ready very detailed business plan before they start their businesses. Others argue that entrepreneurs don’t need to have all detailed information in one place to get started and should concentrate on building their product before everything else.

When it comes to meeting with investors, however, it is important to have outlined the main aspects of the venture. It is important to include the main aspects of the business in order to make the funding plan appealing to the potential investors.

Here are five elements that you should include in your business plan before the next investor meeting:

The problem – What problem do you solve? Is it big and important enough so people will be willing to pay for its solution?

The solution – How will you solve the problem? What are the special features of your product/service? Present this information in an accessible way, avoid niche jargon. Make sure that the investors are able to understand how you are solving the problem. Bet on simplicity.

The market size and business model – How you will make money? How big is the market? What percentage of the market are you aiming to get? What is your growth strategy? Investors prefer businesses from growing and promising markets – the bigger chunk of the market size you can get the better.

The competition – Who are your biggest competitors? How do you differentiate from them? What makes you better than them? How competitive are your prices?

The funding – When you approach an investor, it is essential that you know your numbers. It is important to know how much you are making and how much you are predicting to make, but also you should make it clear how you have come with the funding requirements.

Why are you asking for this specific amount of money? How are you going to spend the money? Estimate your valuation carefully, otherwise, you are risking to receive a rejection.

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