his is the second publication this week of a three-part series on how to obtain private sector financing for your growing business.
To develop a strategy to attract potential investors that will provide growth capital to your business you will build on these requirements. Investors are likely to seek companies with good growth potential to ensure you get an excellent return on investment and to gain access to their money when the time comes.
Potential investors may require the following:
• a situation analysis describing the strengths and weaknesses of your business, and any opportunity that comes along and challenges your company faces;
• an evaluation measuring the ROI or the difference between the current value of your business and its future value (advice from a specialist may be helpful in this case);
• an exit strategy for withdrawing their money invested in your business.
You want to attract the attention of investors? In this case, a compelling investment project is essential. Your business plan will be used for internal use, but the investment project is a tool that will allow you to sell your ideas and raise money.
Your project serves as an argument and present the following:
• the nature of your business;
• its history and its growth potential;
• your objectives and the financing needed to achieve them;
• the warranty that you offer;
• the repayment strategy.
Here are some tips on writing an investment project:
• Use the terminology of the field of investment and do your research, you will gain in credibility.
• Bring out the value of your ideas and their potential profitability; be convincing.
• Made in simplicity preferring the plain language jargon or too many technical terms.
• Be specific in relation to your funding needs and explain what you will make money.
• Stick to present information related to the project.
• Finish with a strong call to action, and inform the reader of the next steps.
What is the value of your project to investors? Why should they invest in your company over another? See our section on investment projects to find out what you should present your project and how to prepare to be effective.
We will discuss the next steps in negotiations with investors and the proper conduct of these in our next blog. Meanwhile, please see our How to get money for your business to learn more about the Steps to Growth Capital .