| Executive Summary |
The executive summary must cover the company, its products and track record
and the terms of the deal. It must also give a synopsis of your funding needs
and the exit strategies you are offering investors. For more on the executive
summary see Why the Executive Summary Is Important.
|
| Company and
Ownership |
This section gives your company's history, including milestones.
Potential investors need to evaluate where your business has been
before they can evaluate where it may go.
|
| External
Environment |
This section describes your company's industry, markets and competitive
environment. This information helps investors to decide whether
your company can succeed with its plans (given the external forces
that you can influence but not control).
|
| Products and
Services |
This section explains what business you're in. It describes your
current and future products and services, and explains how you'll
market them. Here is the kind of information you should include.
|
| Management
Team |
This section shows investors that they are dealing with a diversified
management team that can contribute to the success of your business
venture. Emphasize the experience and competence of each key member
of your team.
|
| Financial
Plan |
The financial plan is the most referred to part of the investment
proposal. It should include:
- your company's financial history;
- your projected financial statements for the next five years;
- your financial assumptions; and
- your funding requirements.
|
| Financial
Structure and Valuation |
There are advantages and disadvantages to covering the financing structure and
to disclosing your valuation/pricing in your investment proposal.
|
| Operational
Plans |
This section describes your company's plans and strategies for capitalizing on
the growth opportunity. Focus on these items:
- a description of the growth opportunity and why you feel your
company can capitalize on it;
- a description of the specific actions needed to carry out the
strategic plan; and
- the effects of these actions on the key operations of your
business (marketing, production, etc.).
|
| Appendixes |
Using appendixes is an effective way to present detailed information
without cluttering up the main body of the document. |
How long should the investment proposal be?
There are no rules. In general, the longer the investment proposal,
the less likely it will be read. So, limit yourself; provide
just the key information that investors will need to make their
decision. And keep the executive summary to fewer than four pages.
