1. It is important that you clearly state your value proposition. You can think of this as your elevator pitch. Answering the questions, ‘which problems are you solving?’, ‘how are you better than the competition?’ and ‘why will you succeed where others have failed?’
2. Precision is everything. While it’s nice to share your dreams with people, your business plan should deal with concrete issues like financing, product development, distribution and branding among others.
3. Answer the question ‘how will this company make money?’
4. Add brief biographies of your core staff members. Funders are putting their faith in an entrepreneur and his team
5. Making sure that the money you are asking for is in line with your needs. For instance, if you apply for a $100,000 loan, the investor will want to know how every dollar will be spent, whether it goes to inventory, equipment or salaries.
6. Key elements in your business plan: the business idea, your main advantage over competitors, a profile of your target customer and daily operations. You should also include some figures that approximate your potential cash flows.
7. Discuss your project with objective experts you trust and seek their feedback. This is a great way to further challenge your preconceived notions about your feasibility.
8. If possible, begin your business with your own financial resources or those of your family. Why? Because half of all new start-ups fail in the first five years. If your business is one of them you’ll be in a better position if your borrowed money from your parents than from a bank.
9. The opening section or the first part of your business plan can make or break the deal: it’s called the executive summary and it’s absolutely essential. This section might be the only bone your readers even look at. After all, bankers and investors are busy people, often mired in piles of business plans.
10. So, in the first paragraph state the problem you are going to solve for your customers and how your solutions are unique. Then, in a marketing paragraph, explain who your target is, how much you expect to sell and what competition you’ll face. The following section should be brief and focus on your team. Give details about all your past experience an d expertise in the industry. Finally, the last paragraph should detail your finances through key figures like your expected income over the next three years. Here you should list how much money you need to get going, split this amount between the sum you’re putting down and how much you’ll need from outside investors. But remember to keep it short and sweet at two pages max. And although the executive summary is the first section of your business plan, it’s actually best to write it last. That’s because you’ll do a better job once you’ve drafted the rest of the plan and know exactly what your project is all about
11. It’s also important to highlight your competitive advantages. Maybe you’re local, meaning you’ve got inside knowledge of a particular market or tons of experience in your field.
12. Any potential legal issues should also be detailed.
13. Also answer these questions: ‘Will you work in a team or by yourself?’, ‘Do you want to hire people on a contractual basis?’ ‘Do your staff members have the necessary expertise?’
14. Include a market analysis that details the size of your market and potential customers or business clients. By beginning this analysis with the size of the market, you’ll show that there are enough customers to make your idea profitable. From there you can profile your ideal customer, a crucial step in figuring out how to reach him. For instance, say you invented a new Facebook-like site for dogs. Your target is likely pet lovers between the ages of 15 and 40 who are excited about new technology.

Then produce a competitor analysis; in this you want to identify roughly five main competitors along with their biggest strengths and weaknesses. For instance, this might relate to their marketing strategies, their delivery policy or their operating hours. Then you can try to determine how your competitors will respond when you enter the market. For instance, will they slash their prices, steal your ideas or maybe increase their use of aggressive advertisements?

The last step is to offer specific marketing techniques, like email marketing , press and media, internet ads, blogging and countless other strategies. To determine which are right for you, keep track of the costs of each and the potential benefits they produce.

15. Forecasted financial statements are invaluable tools to prove that your business is profitable. There’s another aspect of your business plan that’s absolutely essential to investors and that’s the financial statements. There are 3 types of financial statement that every business plan should have: the balance sheet, the income statement and the cash-flow statement.

• The balance sheet is simply a two column table divided between assets and liabilities. The former describes what you’ve got-like equipment, money and inventory- and the latter what you owe, such as loans to a bank or debts to a supplier. It is more or less a snapshot of your company’s money and debt.
• The income statement comes second. It’s a single column chart that details your sales, minus your expenses, displaying your net profits.
• Your cash-flow statement looks very similar to one you’d receive from a bank, simply showing the in-and our-flows of money.

Each figure your present should be supported by evidence. Whether that comes in the form of market research, interviews or even your own hypothesis. To be cautious you can even draft a couple of different scenarios, one conservative and one a bit more optimistic.

16. Different types of funding: before you even apply for a bank loan, you should have secured some other funding. A bank will also want you to commit your own money, bringing in collateral of about 125% of the loan. If you can’t get a bank loan you can go with two other potentially more expensive options. The choice is between business angels and venture capitalists, both of whom will offer cash in exchange for shares in your company.

• Business angels. They invest up to $2 million, expecting a return of between five and ten times their original investment.
• Venture capital firms, tend to invest larger amounts of between five and ten million dollars but expect much higher returns in the range of about 30 times the original.

Naturally these funding options will cost you more in the long run than a bank loan because they are assuming a greater risk.

But regardless of the type of investors you secure, they’ll all have shared requirements when it comes to the financial data you provide. All of them will be interested in what’s known as your burn-rate, the amount it costs you to operate over a given period. Investors are obsessed with this indicator because it describes how long your business can stay afloat with their investment. They’ll also likely want to see a three-year financial forecast with the first year broken down month by month.