Steps to Growth Capital Fast Track

Investment Proposal

"If I can't be creative in building my business plan and proposal, then I can't convince investors that I'll be creative in building the company."*

You need a concise and compelling proposal because it's what you'll use to grab the investor's attention.

The proposal is not the same as your business plan. The business plan is designed for an internal audience (namely your managers), to guide their work; the proposal is designed for an external audience, to sell your idea and raise the funds you need.

Investors want the proposal to give them an immediate understanding of:

• the terms of the deal;
  
• what makes the deal or opportunity unique;
  
• the balance sheet;
  
• the calibre of the people involved; and
  
• the characteristics of the company and the industry.

The Executive Summary

"The executive summary does most of the selling."*

The executive summary must be brief and complete in itself. If it's successful it will encourage investors to read more. It needs to show them:

• how much they can expect to earn from the deal;
  
• evidence that your team has the skills to execute the plan;
  
• how they can protect their interest; and
  
• how they can realize their investment.

Getting the Investors' Attention

"I kept the needs of the investor in mind, and I included graphics to explain the process because investors are not experts."*

The proposal needs to capture the investors' interest by providing them with the information they need in an attractive and easily understandable style. Pay close attention to the writing and visual presentation:

• Keep the writing clear and concise.
  
• Avoid jargon and explain technical information.
  
• Use graphics and formatting to help convey your message.
  
• Package the proposal so it's easy to read.

"I know they'll read the first three pages and make a decision whether to continue, but by packaging the proposal creatively, I'd already made an impact."*

Table of Contents

A typical proposal contains the following sections:

• Executive Summary;
  
• Company and Ownership;
  
• External Environment;
  
• Product and Services;
  
• Management Team;
  
• Financial Plan;
  
• Financial Structure and Valuation;
  
• Operational Plans; and
  
• Appendixes.

Action Items

Use our Investment Proposal Checklist to guide your proposal preparation.

* All quotations used with permission of Chris Griffiths, Griffiths Guitars International, St. John's, Newfoundland, Canada.

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