Searching for equity finance, how to pitch your business plan.

Making good business decisions in today’s complex world is a challenge in the best of situations. When you are deciding which finance format to use it can be a nightmare. In previous articles we have explained the pros and cons of various finance solutions for your business. Venture Captial, Equity Finance, Enterprise Capital Funds, Bank business loans and even loans from friends and family. Which you choose will depend on your goals, the kind of business you’re managing and even your personality. Medium to large companies that need serious financing will generally benefit more from Venture Capital funding. However small to medium companies that want both cash and expert help will normally do better with equity finance.

So you went for equity finance, now what?

So you decided which finance solution you want to go for. That was the easy part. Equity finance might deal with smaller investments and focus more on smaller and less experienced companies but it still prizes and backs professionalism and good business practice. It pays to think ahead and plan well for your interview with any prospective business angels or equity finance providers. Business angels are successful entrepreneurs in their own right that know what to look for to see if a business has real potential. It is easier to invest in a company managed by a person you can trust, that is knowledgable, positive and realistic with their company’s potential.

So how to I prepare my business plan presentation?

Don’t waffle: Get to the point, present the facts in an open, enthusiastic way.

Explain what amount and type of investment is needed. Detail what cash or expertise you require. Explain what the cash will be used for and how it will be used.

Explain the terms of the investment. Capital finance offers cash for ownership in the company. It is like a version of the stockmarket but with a mid to long term ownership vew. It will be easier for an investor to hand over his money if he understands clearly what is offered in exchange.

Sell your company, point your strengths. But be realistic. When proposing a business plan you need to convince your audience that you are the man / woman to invest in. That your company is up to the task. How to do this? Ellaborate on previous successes, talk about the policies, procedures, quality assurance in place at your company. Provide tax statements, records and any financial record you have that will put your business in a good light, without being deceitful. Check all the facts you state and be ready to offer data they can scrutinize. You will be dealing with professionals who know their business. They will ask hard questions, have clear, concise answers ready.

The quality of your business plan will depend largely on providing a clear direction to your business, explaining what you will spend their investment in and what profit you are expecting.