Business plans continue to be an essential element of the capital-raising process. A winning business plan must convince investors to take notice – investors that are shrewder today due to the ups-and-downs they have experienced over the past few years.
Adding to the financing challenge is the plethora of high-quality companies, both public and private, in which investors can choose to invest. In this environment, more and more investors are asking companies seeking capital the question “Why You, Why Now”?
The question seems simple at first, but has many complexities. The management team must clearly delineate what it is about the business opportunity that makes it such a good investment now. Should this investment have been made a year ago to cement a market leadership position? Or, is the venture before its time – will slow market adoption cause slow sales over the next few years, and as such, should the investment wait. Questions like these, based on investment failures from the past few years, continue to surface and must be addressed by the management team in their business plans.
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Likewise the team must address what it is that makes them uniquely qualified to succeed. Does the team have proprietary (and protectable) technology, management talent and experience that competitors do not, long-term strategic partners? According to Growthink president, Dave Lavinsky, “Management teams must prove to investors why they are unique and why they will succeed. They can’t just state how wonderful they are – they need to prove it through detailing past successes and unique qualifications.”
A business plan that fails to address the “Why You, Why Now” question, is most likely a business plan that will remain in the stack of “not now” business plans. Winning business plans must present a compelling argument as to why the investor should invest and in our fast-paced world with unbelievable opportunities and opportunity costs, why investors should invest now.
Recommended Books on Creating a Winning Business Plan:
- Anatomy of a Business Plan: The Step-by-Step Guide to Building a Business and Securing Your Company’s Future (Anatomy of a Business Plan: A … Smart, Building the Business, & Securin)
- Business Plans That Win $$$: Lessons from the MIT Enterprise Forum
- The Complete Book of Business Plans: Simple Steps to Writing Powerful Business Plans
- Successful Business Plan: Secrets & Strategies (Successful Business Plan Secrets and Strategies)
- Writing Winning Business Plans: How to Prepare a Business Plan that Investors Will Want to Read and Invest In (Rich Dad Advisors)
As President of Growthink Business Plans, Dave Lavinsky has helped the company become one of the premier business plan development firms. Since its inception, Growthink has developed over 200 business plans. Growthink clients have collectively raised over $750 million in financing, launched numerous new product and service lines and gained competitive advantage and market share.
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- Myths and Realities of Business Plans
- Pros and Cons of Financing a Business
- Basics of a Business Plan
- What is an Investor Ready Business Plan?