By Alan Lowe ©2014
Once you have completed a business plan for your new business, you feel an enormous sense of accomplishment. You will have learned more about your ideas, your target market, the risks involved, and your strategies than you could have possibly imagined you would know before you completed your plan.
Now that you’ve drafted this plan up in one form or another, you’re going to use it to guide you through your business development. This plan is now your ‘bible’. If you are not in a position to self-fund your new project, you’re going to also use this plan to raise money, and that means presenting your plan to investors. You need to become that master and omniscient creator of your new ‘bible’. You need to be a quick-witted expert on all things ‘new project’.
The fact is, regardless of whether you are seeking out venture capitalists, angel investors, or even raising funds from friends and family, these prospective investors aren’t going to read all 50 detail heavy pages of your plan. Hopefully they’ll read your executive summary, but in order to get to that point you need to excite and hook them. These questions will help you form your elevator pitch. Every time you meet a stranger at the coffee shop, in the elevator, at the gym, or pumping gas, you should be answering these three questions for them before they ask and before they even know that they care. Yes. Introduce your baby to everyone you meet, as often as possible, and with confidence. It is your job.
If you can easily and skillfully answer the following questions with the confidence of the omniscient creator of the ‘bible’ of (insert your project here), then you will be well on your way to leaving your prospective investors with seemingly no choice but to be a part of your team or a future customer/client. And they thought they were just running to get their morning coffee…
- What is your project?
You know what your project is. You just wrote an encyclopedia on it. And maybe it’s the perfect combination of unique and familiar to easily answer this question, but chances are you are so personally excited and invested in your budding brilliance that you are prone to drone on and on about what exactly your idea is.
You need to answer this question quickly, clearly, and concisely. It’s okay (and even a good idea) to leave your audience with questions. You need to bait them and engage them. Challenge yourself. Can you answer this question in 30 seconds or less? That’s about all you’ve got to keep the interest of your uninitiated audience. Concentrate on the most exciting part of your venture, and leave your audience salivating.
- Why is this project necessary or a good idea?
Again, this can be a challenge. Your business plan is the place for details, facts, and figures. If you’ve excited your audience enough by telling them the “what”, they’re going to want to know why. This is your opportunity to not only stir up excitement, but also to prove your undeniable expertise. You should answer this question in less than five sentences.
Your answer to this question should demonstrate the problem that your product or business will solve.
Your product or service is necessary because it solves ‘problem x’. Your business will solve ‘problem x’ efficiently, and better than your competitors because of your bullet proof competitive advantage.
- Competitive advantage, you say??
This is the how. You undoubtedly wowed your audience with your seemingly superhuman and mind-blowing hint at your competitive advantage. They now know what you plan on doing, and why it needs to be done. And you have used both of those questions to set their synapses on fire. If you can nail this last piece, you just might get them interested enough to get their business card and having them pouring over your executive summary over their morning coffee.
Don’t be shy. This is the crowned jewel of your business plan, your strategy, and the backbone of the viability of your project. Again, you should answer this question or present this statement without boring your busy audience. You now have about 15 seconds to hit a home-run.
You have a patent, or a unique strategic relationship. You are the proud owner of some form of intellectual property or innovative strategy. Now is the time to throw it at ‘em like a golden ton of bricks. Do it quickly, and leave plenty of detail questions on the table.