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A little guidence??

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A-GAME

New Contributor
Sep 23, 2007
61
6
12
Australia
Hi everyone...Id like to find an angel investor to invest a small amount of money ($100,000AU) in the start up of my business...I've never written a business plan before and would like someone to give me some specifics as to what an investor would want outlined exactly in the plan...I would also like some help developing an exit strategy so that i can be debt free within 4-5 years...If any of you are experienced in this area and have time to correspond with me occassionaly,feel free to leave your email...Thanks
 

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ramy98

New Contributor
Read Millionaire Fastlane
Sep 1, 2007
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15
30
Florida
A game; you can find websites that can help you with the creation of your business plan; I also found a couple of nice books at my local college library. The business plan will highlight:

Company Description
Product or Service - What will you sell ? What service will you offer your clients? How will you differentiate yourself ?
Market Analysis - Who are your clients? Businesses? How are you going to reach them ?
Strategy & Implementation - How are you going to accomplish your goals ? What are managemnets responsibilities? How can you track results?
Financial Analysis - Projected Net Income/Loss figures & Cash Flow Projections

This website should be helpful for you.
http://www.bplans.com/dp/
 

MJ DeMarco

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Angels look first for ROI, the marketspace bandwidth, entry barriers, and managment team. Many a business idea is funded based on the management team vis-a-vie the actual business idea. The thought being: We invest in people, not ideas.
 

kimberland

Bronze Contributor
Jul 25, 2007
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I understand what you're saying MJ
but a business plan helps management sound competent
to future investors.

For example:
I'm working on a business plan for a restaurant type start up.
If they hook up with bankers or investors with experience in the business (and that is, of course, preferable),
Management will be asked about traffic, conversion rates (to guest counts), average check, food costs as a percent of sales, percent of lucrative liquor sales, etc.

Challenging to know all that without going through all the work needed for a good business plan.

I always say that its not about the business plan,
its about the answers you get
when you ask the questions for the business plan.
 

A-GAME

New Contributor
Sep 23, 2007
61
6
12
Australia
ok thanks for the responses everyone...much appreciated but i really need to know how to work these figures out...id like to know my business plan is going to make an angel happy,but at the same time i want to be sure im not ripping myself off...i have no experience in this type of finance at all,so how can i put all these facts and figures together without more information? sure,writing a business plan will be simple enough,but if i was an angel,the contents would be extremely important so i dont want to make the mistake of writing one that isnt gona cut it if you get my drift...i dont want to lose investors because my business planning is working in a trial and error type fashion...and i really dont want to waste time...i need to know what type of return do angels typically expect? as well as how to structure the exit strategy...its all good and well to say i want to be debt free in 4-5 years,but how do i work the figures out?....
 

Peter2

Fastane Legend. RIP.
Aug 2, 2007
408
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Palm Beach, FL
  1. Write a Presentation and a Business Plan
    I suggest starting with a presentation that contains 10 to 15 slides and runs for no more than 20 minutes. In the course of your presentation, you should outline your product, your market, your management team, and the reason you think your product will sell. You should make the presentation before a few people you trust, get feedback, revise it, and give it again, this time taping it. When you view your taped version, make sure you are making a compelling case for your company.
    Only after you are satisfied that your presentation does make your case are you ready to write your business plan. Crafting such a plan is a fairly standard exercise. You can find tips in books, Web sites, and software programs. I recommend making an outline, using simple prose, and keeping your document to a maximum of 20 pages. Don't submit an 80-page plan!
  2. Identify Potential Investors
    Having developed a presentation and a plan, it's time to identify potential investors. One rule of thumb: Approach only those individuals who are less than two degrees of separation from you. Get references from people you know, but should those new acquaintances refer you to their contacts, you're on thin ice. Referrals from referrals rarely invest.
    Another tip: Stay local. You won't need to go beyond your geographic area to find pockets of people eager to invest. It is, however, a good idea to approach people you don't know (and who may not be in your locale) if you believe they have a unique understanding of your product. Since you are only looking for $100K, you should also stay away from Angel investors with a lot of capital, as they would not be interested in a small deal like this.
  3. Create a Term Sheet and Specify a Valuation
    You're now ready to create a term sheet, a one-page outline of the investment opportunity your company affords. It should include a "valuation," your best estimate of what the company is worth. Determining valuation is tricky. I suggest that you not try to gouge your investors. Aim for a fair deal. If you think your company is worth, say, $300K, and your investors offer $100K to $200K, go with the $200K. From the beginning, you want investors always to feel as if they're making money. Even though they'll own more of your company with the lower valuation, during later financing rounds, your company's stock will be more likely to increase.
 

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