how to write a business plan for
investors a lot of entrepreneurs come in
with this kind of question that came in
recently from one of my YouTube viewers
beauty box beauty box wrote in to say
I’m a new subscriber Evan I’m a recent
graduate with a great business idea my
major was in business I’m having
difficulty putting together business
plan do you have a generic template I
can use or Norva site where I can get
one thank you when you’re approaching
investors okay I don’t know if you’re
going after angel investors or friends
and family or Bank or whatever it is it
doesn’t have to be complicated
okay business plan does not have to be
super complicated you don’t have to have
a business degree don’t don’t let that
hold you back just because you don’t
have a business degree you think I can’t
write a great business plan okay what it
has to do is make sense if you go to any
bank website any major bank they’ll have
templates there they’ll have templates
of business plans that you can look at
and see how to structure it the
structure is not as important as the
content and as long as it makes sense an
investor is going to look at it and make
a decision based on that remember
investors are not experts in your field
they are not experts in the beauty
business they’re generalists they want
to see that you’re going to be able to
make them money or if it’s a loan to pay
back that loan I used to be in the
venture capital business and here are
the three things that I looked at first
three things these are the three things
that I looked at before make a decision
to bring in a company and give them
money or not
okay the very first thing is the
executive summary that’s the one or two
pages at the beginning of your business
plan that explains in basic English what
it is that you do and so many
entrepreneurs get this wrong most of the
business ones that I saw got trashed
because the executive summary was was
terrible if you don’t do a good job an
executive summary doesn’t matter how
great a business plan you have nobody’s
going to read it because you didn’t sell
them on the executive summary so that
one page is critical has everything that
somebody needs to know about the
opportunity ahead of them okay the one
thing that that we always look for is
that it passed the grandmother test okay
this was the turmeric music
s in the VC world is it so simple to
understand that your grandmother can
understand it because too many
entrepreneurs put jargon and short forms
and technical terms that the investors
they don’t understand that and it makes
sense to you
you read this together that’s what we do
of course how do you not understand that
but it doesn’t make sense to the average
person so make sure that you give your
executive summary to a person who has no
idea what your business is all about a
layman because if they can understand it
and see the opportunity then you’re
ready to bring it to investors so it’s
the most important first step get the
executive summary down the next thing
they’re going to look at is your
financials they want to see how much
money do you need what’s it going to be
used for and how much money are they
going to make back different types of
investors have different criteria if
you’re looking to go to a bank they
don’t want to see massive huge returns
they want to they want the security that
they’re going to make their money back
if you’re going to an angel investor
they want to see that you’re going to be
making thirty percent a year on their
money because they want an exit from
this so they want to see high growth if
you’re a low cost low margin low growth
type of business that’s not going to
work with an angel investor so you’ve
got to make sure that the financials
make sense for the person that you’re
talking to the next thing and the last
thing they’ll look for before making a
decision to read the whole business plan
is the team who is behind this company
there’s an expression in the VC world
again called horse for the course
meaning are you the right person to be
at the head of this company and make
this opportunity to happen because you
could be in a great market but if you’re
not the right person you’re not going to
be successful and you can be in a crappy
market but if you are the right person
you can still build a great company so
they want to learn about the management
team who are you and the biggest thing
that most entrepreneurs fall down on
here is they have lack of startup
experience investors and bankers they
want to see that you have done this
before
or you have people on your team who’ve
done this before and quite often on a
management team there’s nobody there
it’s just you
and you’ve never done it before and so
these are like big strikes against you
so yeah I’m gonna risk my money with
this person I don’t think so one way to
combat this is to you can either look
for partners so bring on people who who
have more experience who can compliment
you but if you don’t want to give up
equity you’re not quite sure to
partnership relationship yet create a
Board of Advisors and these are people
who’ve had some experience have some
success they don’t have any equity in
your business it’s it’s kind of a loose
term but they’re willing to lend their
name to the business and an advisor
could be structured where you meet them
every month and you have coffee talk
about it or it could be that you you
know it’s loose and every six months you
have a phone call as long as they’re
willing to help you and lend their name
to the project because if a banker or an
investor looks at your management team
and they see you with no experience no
partners you’ve never done it before
they’re thinking I’m going to lose all
my money so reduce that risk separate
yourself from everybody else bring on
the Board of Advisors talk to people
even if it’s your lawyer or your
accountant even just putting their names
on there to say their advisers you’ve
already separated yourself from most of
the other people who are presenting and
giving their business planning because
it shows that you value and trust the
expertise of other people who can help
you build this thing up okay if you pass
those three things they’re going to look
to the rest of the business plan and see
if they want to make a decision to bring
you in invest in you or whatever okay
the actual templates are not hard to
find
again any bank website will have sample
templates but the templates is a good
starting point to give you an idea of
the sections but really the meat of it
is going to come from having an
executive summary that makes sense
financials that make sense that a tailor
to the person you’re talking to and then
having a management team / Board of
Advisors that give the investor some
sense of security that they give you
money you’re not going to go lose it all
thank you for the great question you
have any more questions let me know
believe for those of you watching like
the video give it a thumbs up if you
have a comment about this video or you
want me to expand on
things I talked about leave a question
below in the comments I make a video
response thank you so much and I’ll see
you soon
investors a lot of entrepreneurs come in
with this kind of question that came in
recently from one of my YouTube viewers
beauty box beauty box wrote in to say
I’m a new subscriber Evan I’m a recent
graduate with a great business idea my
major was in business I’m having
difficulty putting together business
plan do you have a generic template I
can use or Norva site where I can get
one thank you when you’re approaching
investors okay I don’t know if you’re
going after angel investors or friends
and family or Bank or whatever it is it
doesn’t have to be complicated
okay business plan does not have to be
super complicated you don’t have to have
a business degree don’t don’t let that
hold you back just because you don’t
have a business degree you think I can’t
write a great business plan okay what it
has to do is make sense if you go to any
bank website any major bank they’ll have
templates there they’ll have templates
of business plans that you can look at
and see how to structure it the
structure is not as important as the
content and as long as it makes sense an
investor is going to look at it and make
a decision based on that remember
investors are not experts in your field
they are not experts in the beauty
business they’re generalists they want
to see that you’re going to be able to
make them money or if it’s a loan to pay
back that loan I used to be in the
venture capital business and here are
the three things that I looked at first
three things these are the three things
that I looked at before make a decision
to bring in a company and give them
money or not
okay the very first thing is the
executive summary that’s the one or two
pages at the beginning of your business
plan that explains in basic English what
it is that you do and so many
entrepreneurs get this wrong most of the
business ones that I saw got trashed
because the executive summary was was
terrible if you don’t do a good job an
executive summary doesn’t matter how
great a business plan you have nobody’s
going to read it because you didn’t sell
them on the executive summary so that
one page is critical has everything that
somebody needs to know about the
opportunity ahead of them okay the one
thing that that we always look for is
that it passed the grandmother test okay
this was the turmeric music
s in the VC world is it so simple to
understand that your grandmother can
understand it because too many
entrepreneurs put jargon and short forms
and technical terms that the investors
they don’t understand that and it makes
sense to you
you read this together that’s what we do
of course how do you not understand that
but it doesn’t make sense to the average
person so make sure that you give your
executive summary to a person who has no
idea what your business is all about a
layman because if they can understand it
and see the opportunity then you’re
ready to bring it to investors so it’s
the most important first step get the
executive summary down the next thing
they’re going to look at is your
financials they want to see how much
money do you need what’s it going to be
used for and how much money are they
going to make back different types of
investors have different criteria if
you’re looking to go to a bank they
don’t want to see massive huge returns
they want to they want the security that
they’re going to make their money back
if you’re going to an angel investor
they want to see that you’re going to be
making thirty percent a year on their
money because they want an exit from
this so they want to see high growth if
you’re a low cost low margin low growth
type of business that’s not going to
work with an angel investor so you’ve
got to make sure that the financials
make sense for the person that you’re
talking to the next thing and the last
thing they’ll look for before making a
decision to read the whole business plan
is the team who is behind this company
there’s an expression in the VC world
again called horse for the course
meaning are you the right person to be
at the head of this company and make
this opportunity to happen because you
could be in a great market but if you’re
not the right person you’re not going to
be successful and you can be in a crappy
market but if you are the right person
you can still build a great company so
they want to learn about the management
team who are you and the biggest thing
that most entrepreneurs fall down on
here is they have lack of startup
experience investors and bankers they
want to see that you have done this
before
or you have people on your team who’ve
done this before and quite often on a
management team there’s nobody there
it’s just you
and you’ve never done it before and so
these are like big strikes against you
so yeah I’m gonna risk my money with
this person I don’t think so one way to
combat this is to you can either look
for partners so bring on people who who
have more experience who can compliment
you but if you don’t want to give up
equity you’re not quite sure to
partnership relationship yet create a
Board of Advisors and these are people
who’ve had some experience have some
success they don’t have any equity in
your business it’s it’s kind of a loose
term but they’re willing to lend their
name to the business and an advisor
could be structured where you meet them
every month and you have coffee talk
about it or it could be that you you
know it’s loose and every six months you
have a phone call as long as they’re
willing to help you and lend their name
to the project because if a banker or an
investor looks at your management team
and they see you with no experience no
partners you’ve never done it before
they’re thinking I’m going to lose all
my money so reduce that risk separate
yourself from everybody else bring on
the Board of Advisors talk to people
even if it’s your lawyer or your
accountant even just putting their names
on there to say their advisers you’ve
already separated yourself from most of
the other people who are presenting and
giving their business planning because
it shows that you value and trust the
expertise of other people who can help
you build this thing up okay if you pass
those three things they’re going to look
to the rest of the business plan and see
if they want to make a decision to bring
you in invest in you or whatever okay
the actual templates are not hard to
find
again any bank website will have sample
templates but the templates is a good
starting point to give you an idea of
the sections but really the meat of it
is going to come from having an
executive summary that makes sense
financials that make sense that a tailor
to the person you’re talking to and then
having a management team / Board of
Advisors that give the investor some
sense of security that they give you
money you’re not going to go lose it all
thank you for the great question you
have any more questions let me know
believe for those of you watching like
the video give it a thumbs up if you
have a comment about this video or you
want me to expand on
things I talked about leave a question
below in the comments I make a video
response thank you so much and I’ll see
you soon
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