Creating a Business Offer and Attracting Investors: You may have an innovative business idea and a clear road map, but is that enough to make your dream company come true? Not quite.
To grow, you need investors who believe in your business the way you do. You have to realize the potential of your idea, and this is where business proposals come in.
The purpose of a business proposal is to come up with a business idea, communicate your vision, and convince investors that your startup is worth their money (and time).
Also, in today’s challenging market scenario, raising capital is even more difficult as having a strong proposition is essential.
These are the seven main components of a business proposition:
- Summary of Executive
- Company’s Description
- Market Analysis
- Marketing Strategies
- Management Structure
- Financing Needs
- Financial Prediction
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Let’s take a look at six tips for creating a compelling business proposition that will attract investors.
Table of Contents
1. Prove Scalability
One of the most vital components investors look for in start-ups is scalability. Scaling a start-up refers to the ability to grow it profitably.
Consider the following questions to demonstrate the scalability of your business proposal:
What is your business goal?
How profitable is your idea?
How repeatable are your solutions?
What makes you different from the competition?
Say you’ve started a t-shirt printing business. While heat transfer printing can work in the early stages, it is not a long-term solution, and it is certainly not scalable. The essential thing is to adopt a more sustainable printing model that will allow you to sell in bulk without sacrificing quality.
2. Conduct Market Research
Conducting extensive market research forms the basis for a more informed and logical conversation with investors. The knowledge idea behind this step is to use the results of your study to support your business idea and demonstrate why it is feasible.
Start with competitive research, understand the market situation and prospects. It is important to know what your competitors are doing to find and fill the gaps.
In addition to your competitor analysis, be sure to clearly state the target group for which your company is responsible. Find your target audience and segment them based on demographics, geography, and behaviour.
3. Share Realistic Financial Estimates
If you need investors to invest in your commercial business, you need to address them with compelling financial forecasts, which are essentially a forecast of future income and expenses.
It is advisable to make projections for a period of 3 to 5 years to demonstrate the type of return investors can expect accurately.
Many startups kind the mistake of being too ambitious to attract investors without realizing that they are likely to hit these numbers if their proposal is approved. Hence, it is imperative to be realistic when planning finances and making the assumptions on which you will base them.
In addition to the income projections, present a detailed plan of how you intend to use the investor’s money. The most effective way to show this is to put your forecasts on a timeline so that investors can easily visualize this information.
4. Present a Credible Team
“Investors don’t invest advance in ideas, and they invest in people.”
It is a golden rule for investors, and rightly so because it is the leadership team that drives the business. Investors must be sure that they are putting their money in competent hands.
So, when writing your business proposal, assign a section on key team members and their backgrounds, skills, and experience. It would help if you also mentioned what each team member is responsible for.
Use a flowchart maker to create an org chart that shows the team’s structure and tasks.
5. Focus on the Summary
The summary of your business proposal may be the most important section because it is safe for everyone. Although it looks at the beginning of the proposal, it is advisable to write it at the end so as not to lose important information.
The abstract intends to provide a brief description of your proposal. Many investors use this section for verification purposes. Therefore, it is imperative to take the time to write a compelling and compelling summary.
From your business offering, goals, and operating model, to your target audience, financial projections, marketing plan, team structure, and funding needs, the summary should contain everything investors need to know to invest in your company.
6. Keep a Clean and Consistent Design
While it is central to focus on the content of the business proposal, don’t overlook the design aspect.
Submit a well-designed, bright, and attention-grabbing business proposal. Let the design draw readers in rather than distract them.
What you need is a steady colour scheme, bold fonts, and a modest layout that improves readability. It’s also a great idea to break up paragraph snippets and use bullets to make it easier for users to scan the content.
You can also use professional plan templates to save time and ensure consistency.
Your business proposal is a road-map for the future. Business proposal creation is about telling stories effectively, from generating interest and demonstrating a passion for highlighting the growth potential.
Investors come across various business proposals. So be accurate and write a powerful one that convinces them to sign off.