I’m going to tell you the truth. No matter how amazing your idea is, a poorly executed business plan will make securing funding a hassle. Your plan needs to sell your business to investors and convince them they’ll get a return on their investment – sooner rather than later.
It’s tough out there. With so many entrepreneurs seeking funding and investors looking for only the best ideas, it’s been estimated that in the US alone, at least 27% of start-ups don’t receive the funding they need to get off the ground. The reality is that the market is flooded. Your ideas need to be truly exceptional, and your plan to achieve them needs to be foolproof.
Look, it’s not all bad news. There are a few errors you can avoid to ensure potential investors make it past the introductory page of your business plan.
- Don’t Waste Time
Your investors have taken time out of their day to listen to your revolutionary idea – don’t waste a second of it. Whatever time allocation they give you, make sure you time your presentation to fit within the slot and have some wiggle room for questions and feedback.
Running over will impact the rest of their day and more than likely annoy the daylights out of them.
Keep it short, sweet and to the point.
If your audience becomes restless, you may want to check the time and adjust your presentation accordingly.
- TMI – Too Much Information
Trust me, I’ve been there. The urge to bombard investors with all the information you can possibly think of is a real problem. You want them to make an informed decision, which makes sense. However, too much information can be off-putting. Only include relevant data and keep it simple.
- Unrealistic Financials
This section has two parts. Firstly, including ALL your business financials is a lot of information to process and will be difficult for your audience to retain. Instead, list a summary to give an overview of your needs and expectations.
The second part of this relates to the information listed within your financials. In a perfect world, we would love to double our return in the first year, but that’s not a realistic forecast. When listing your financials, keep them realistic. Rather underestimate than overestimate.
- No Problem To Solve
Why did you come up with this business proposal? Were you bored and it just popped into your head? Or does it address a problem faced by society?
If your business isn’t intended to meet a need to address a societal issue, you may want to head back to the drawing board. The odds are that no one will want to invest in a wishy-washy operation.
- A Million Ideas Instead Of One
I get it, you’re inventive and imaginative, and there’s a whole lot that you can do to change the world. But don’t try and present every single idea in one go.
It’s confusing and seems indecisive. You need to be confident when it comes to your idea. Sure, you can list potential opportunities that may arise as a result, but keep it as precisely that, a list.
- Lack Of Research
How do you know that people will be interested in what your business has to offer? Investors will be interested to know if this is something financially viable before they give you a cent.
Who will support your endeavour, and why would they opt for you and not your competitor? In fact, who are your competitors? These are some of the questions you will be asked, so make sure you’ve got the answers.
- Poorly Presented Paperwork
A business plan that’s poorly laid out can be the death knell for an entrepreneur. You need to ensure your plan is clear, well thought out and includes easy to digest information.
If you’re not sure how to draw a plan up, use a business plan template that you tailor to your needs. This way, you’ll present a professional document that follows a tried and tested format. If your paperwork isn’t professional, why would anyone believe your business would be?
- Thumb Sucking Information
If information is unavailable to support your narrative, leave that section out. While I’m a firm believer in faking it till you make it, this is not the time for that.
You need to be able to deliver on your promises and back your statements with REAL facts. You never know if an investor will Google the information provided and discover that you’re fabricating it. That’s not a trait that you’re looking for when going into business with someone.
- Avoiding Potential Weaknesses
Being able to identify your strengths and weaknesses is critical to the success of any business, but it’s not something you need to harp on about too much. Highlight a few potential areas for concern and keep it at that.
Nobody is perfect, and investors know this, but you don’t want to push them away by oversharing. When asked about your strong and weak points, address them professionally and stick to a single train of thought.
- Not Asking For A Second Opinion
If you’re approaching a group of investors, you want to make sure that your plan covers all bases and encourages the reader to make it to the end. There’s no harm in asking for a second pair of eyes to read through it before you start pitching. It’s encouraged.
Often, I’ve worked on a document for so long that mistakes creep in and I don’t even pick them up – this isn’t something that you want to happen while you’re looking for funding. Having a review system in place can help you streamline your presentation and make sure that it’s in tip-top shape.
While some of these mistakes sound scary, they’re the reality of presenting a business plan. Avoiding them is key, and you will get better with practice.
You need to remember that while you’ve had time to process and work through your idea, the people you’re presenting to are relying on the time you spend with them. You need to use this time to its full potential and leave investors interested in finding out more.
Keep it simple and easy to understand, and you’ll ace it.
This post was written by Megan Hudson, a content champion for various online publications, often covering a range of business topics from finance for startups to small business accounting tips.