“Would You Like To Invest In My Business?”


Is this a question you’re about to ask someone? Or planning to ask a potential investor very soon?

A recent request from a friend seeking advice on how to secure resources and raise funds, so they could kick start their enterprise, ended up with me writing down a few guidelines and sharing some useful advice I’ve picked up over the years. Having written a much longer response than I originally intended, I thought I ‘d share it to help anyone else who needs a ‘starter for ten’ in stringing together a business plan, or an investment proposal.


Firstly, you need to be credible – this can only be achieved if you have an operating venture or enterprise that is functioning and successfully meeting its objectives. It’s not enough just to have an idea or dream, investors want a return on investment from a proven, successful business. Being seen to ‘run before you can walk’ or ‘having your fingers in too many pies’ will also be seen as unrealistic, naive, or even feckless. Not being grounded does not turn on many investors, however beautiful or idealistic your business idea or scheme might be.

Secondly, be concise and back up your business case with hard facts. Woolly proposals padded with indulgent text and wishful thinking doesn’t cut it with most investors – they’re busy people and need to make decisions quickly based on robust evidence, and what’s presented to them. They need to justify their investment, and in the event of not getting the returns they have been promised, will need a very good justification to prove why the made the investment, and very good reasons why the outcomes were not realised. So to address this from the outset, you have to enable others to make a balanced risk assessment. Giving reassurance through strong guarantees needs to be integral to any proposal that’s presented to a potential investor. This is where you prove there is a viable need and market for your enterprise, that it’s competitive, the market conditions are favourable (there’s a hole in the market, but is there a market in the hole?), it can grow, it’s sustainable, and deliver desirable levels of return on investment.

Thirdly, clarity on how the investment will be used, protected and returned with growth – this is where you can demonstrate how the investment will be used, showing operational management activity with costs, forecasts, profit & loss, pricing, break-even points. Demonstrating rigour with checks & balances etc, will providing the type of controls investors will be looking for.

  • Construct your investment proposal and business plan using concise language (no wasted words or embellishment). I suggest you have different versions of the business plan designed for different audiences – there should be at least a version for presenting to investors, and the more detailed, full version for your use in decision making while managing the business.
  • Populate the investment proposal with hard facts on the market conditions, the macro environment that impacts upon and shapes the market, which in turn influences your approach. This is when you consider the political, environmental, social, legal and technological factors that shape the world in which you choose to do business. This especially requires attention if you’re doing business internationally as each country has different laws and cultures to contend with, so what’s acceptable in the home market is not automatically appropriate or acceptable in an overseas market.
  • You should be able to convey everything on a one page executive summary – that says what the investment opportunity is, how it can succeed as an enterprise, how it can deliver return on investment, and what guarantees are in place to deliver that return. Subsequent pages can then drill into the detail using the facts highlighted above. The document should not need to exceed 8-10 pages maximum, including all the sales forecasts, cash flow projections, and financial status.

Beckoning girl in red


Getting people onboard – similar rules apply to winning investment from investors. Getting people enthused, and investing time, support, and energy to help you is a big ask. So you’re more likely to get off to a good start and attract the right people if you start small, and have a clear proposition where your supporters can make a small contribution in the early days. As it builds, and they begin to warm to it through their involvement they’re more likely to spend more of their time, energy, and resources supporting you. Opening a conversation with a potential supporter and presenting a major world-changing master plan might win plaudits, but is unlikely to get concrete buy-in from others.

Showcase your progress and achievements – all developments can be captured, and these will help in winning support from others. Social media provides an ideal way to engage your target market and customers in your journey – a photo of your new product, the location where you’re product or service can be experienced, your narrative, insights, instant updates, and observations can all be shared with your community of supporters and the wider world. This is what defines one of the strategic impacts of social media on the business world – it’s the ‘great leveller’, and is enabling small businesses to compete on a level playing field with larger businesses.

Request funding for the right reasons – every business states they require additional funding, but be clear why you need the funding. Remember that input from an investor or a lender will need to be returned at some point, so time spent thinking through how the funding will be used,  and how and when it will be returned is essential. Being able to make a return to your investor will be dependent on your enterprise achieving its objectives and revenue targets, so consider the funding request holistically in line with your business performance – sales activity, marketing investment, cash flow, and profitability.

Crowdfunding – this is becoming popular and definitely worth considering. Again you will need a simple coherent proposition for people to buy into, so they easily see the ‘What’s in it for me?’ and when they’re likely to achieve their return on investment.

Social enterprise and charitable causes – remember if you’re asking people to fund ‘social enterprises’ or charitable causes, be clear on what returns they will receive. This is especially important if the returns are non-financial. If you are requesting charitable funding or gifts, then this can be subject to specific legislation, aspects which you have to consider and manage if you’re considering going down that route.

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