It needs to work with proven managers who have dealt

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Unformatted text preview: ss, people normally use a two-to-ten-page Summary Document (sometimes called a Summary Memo). The Summary Document should have the key points, such as competitive edge, market needs, defensibility, and of course track records and résumés of main team members. Sell your plan, but keep it short and rich. Focus on real content, not hype, and organize it so that potential investors can understand the main points quickly, then decide whether or not they want to know more. When looking for loans for your business, you will probably want to prepare a slightly different twoto-six-page document, called a Loan Application Summary. It should include the Executive Summary and company ownership detail as well as financials, especially the Profit and Loss, Balance Sheet and Cash Flow tables. Summary As you finish your plan, review it from the point of view of the business purpose. Does it cover what you need it to cover? Is it going to achieve the purpose you planned for it? Are there topics that the plan’s audience will ask about that you haven’t covered? Think of the three most important questions you would expect to get from your intended reader. Have you answered them? CHAPTER 22: GETTING FINANCED Contrary to popular belief, business plans do not generate business financing. True, there are many kinds of financing options that require a business plan, but nobody invests in a business plan. Investors need a business plan as a document that communicates ideas and information, but they invest in a company, in a product, and in people. Small Business Financing Realities Venture capital financing is very rare. I’ll explain more later in this chapter, but start with the assumption that only a very few high-growth plans with high-power management teams are venture opportunities. • Banks don’t finance business start-ups. I’ll have more on that later, too. Banks aren’t supposed to invest depositors’ money in new businesses. • Business plans don’t sell investors. In Chapter 2: Pick Your Plan, I said the plan matches the needs of the company. So does the process of looking for money. Where you look for money, and how you look for money, depends on your compan...
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