Business planning and raising venture capital go hand-in-hand. A business plan is required for attracting venture capital and the desire to raise capital is often the key motivator in the business planning process. The principal aim of this business plan is to assist entrepreneurs in preparing and presenting a capital raising business plan. Essentially, this capital raising business plan is a document that presents basic information to potential investors about the business opportunity that requires funding.
Capital Raising Business Plan
The capital raising business plan is a document that conveys the growth potential and objectives of the company. This section of the plan describes how the company works and how it acquire customers, emphasizing the strengths of the company but, at the same time, not hiding any of the obstacles.This section describes the business in greater detail including information about the past, present, and future of the company.
This section gives details about the actual market and the relative position of the company and its products within the marketplace. It includes the size and growth rate of the market, an analysis of the market and competitors, how products are distributed, where the company and its products stand in the market place and which role the government plays in it. This section explains the needs of the market, its future direction and how the company plans to position itself right in the middle of that.
This part of the capital raising business plan explains how the business operates, how the company makes the products or provide the services, first in brief and then in more detail. It describes the sources of raw materials, suppliers and labor requirements. This section will also outline the company's approach to industrial relations along with research and development.
This chapter of the capital raising business plan defines the marketing plan and it addresses how the prospective business will exploit the opportunities offered by the market. The marketing plan will outline the sales and distribution strategy, the planned sales force, distribution channels, market segments to be attended and promotional strategies.
This section of the capital raising business plan defines the company’s target market; its size, structure, growth prospects, trends, and potential. Providers of capital reading this part of the plan will understand if the market is large enough to support your business now and in the future.
In this part of the capital raising business plan, you will find the marketing strategies the company will use to promote the business such as pricing strategy, advantages over competitors, advertising, public relations and sales strategies.
This chapter is the most important of the capital raising business plan. It includes the balance sheet, income and cash-flow statements for the previous three years (if applicable) along with three to five-year forecasts. It also includes sales forecasts along with information on operational expenses, selling and administrative costs and the actual current capital requirements of the business.
Most investors focus on revenue and profit growth with minimum risk when assessing a business project with investment potential. The capital raising business plan clearly highlights in this section how the company plans to make money and how large is the revenue potential.
It costs money to run a business. This section outlines the marketing costs and administrative costs, and all other expenses that make up the operational costs. This part of the business plan examines these costs in detail, and provide ways to cut costs and evaluate the effectiveness of each dollars spent to keep the business going.