Bure Valley Group is an investment brokerage business which links successful investors with exciting, innovative UK startups seeking funding. This content is for information purposes only and should not be taken as financial or investment advice.
Writing a business plan for a successful startup is an intricate, complex process on its own. After all, this document will not only serve as a vital reference point for yourself, business partners and key stakeholders (e.g. the bank). It will also be crucial when it comes to seeking investors (perhaps via the Enterprise Investment Scheme) to support the growth of your business.
Part of the challenge of a startup business owner, however, is putting yourself in the shoes of the prospective investor to imagine what they will want to hear from your business plan. If you’ve ever watched the UK’s version of Dragon’s Den, you’ll likely notice that many pitches fail to attract investment because the owner(s) failed to include crucial information in their business plan, such as: “What are your projections for profit growth over the next 5 years?”
Here at Bure Valley Group, our investment team has crafted this short guide on how startup business owners can develop their pitch and business plan, making them more compelling to prospective investors. We hope you find this useful and invite any questions you may have.
To find out more about our EIS investment opportunities, please see our portfolio page. To enquire about our latest projects and funding, you can reach us via:
+44 160 334 0827
Keep it short and punchy
EIS investors are busy people with many different opportunities in front of them. As a startup owner looking to attract their investment, therefore, you have a difficult balance to strike with your business plan. On the one hand, your plan needs to contain enough detail and information to give an investor everything they need to consider the viability of your business. On the other, they likely won’t want to spend hours (initially) trawling through reams of pages.
One simple, effective strategy is to keep things short and punchy in your presentation. Don’t use 50 words to say something which only requires 10, for instance. Leverage bullet points, graphs, tables, short sentences, concise paragraphs and attractive infographics where appropriate to make your content more digestible and impactful.
Answer the big questions
As the creator of a great new tech product or service, you (the business owner) might want to focus the attention of your business plan on this. You’re passionate about what you’ve put out to the world, and it’s natural to want to describe all of the bells and whistles. However, put yourself in the shoes of the EIS investor. What is he/she most likely to want to hear about?
They are likely to have the following big questions, which you must be prepared for and ideally anticipate with your business plan/pitch:
- What is the product (in simple terms) and what problem does it solve for customers? How urgent is that problem and how keenly is it being felt by people?
- Is the problem already being solved by other companies, perhaps using alternative products/services? If so, what is it about your idea that solves it in a better/cheaper way?
- How big is the market? Is there plenty of opportunity to grow the customer base through increased market penetration and share?
- Is there scope for your company to develop new solutions to problems down the line, and also enter new markets?
- How scalable is your business? Do you have the potential to grow your revenue streams without mirroring this with your overheads?
Outline the opportunity
If an EIS investor is going to part with their money and grant funding to you, then you need to clearly show what’s in it for them. As an EIS0-qualifying company, you likely have the advantage of operating in an innovative, exciting sphere where you could bring positive disruption to markets which have long awaiting solutions to their problems. So many EIS investors are likely to be attracted to that, especially if you operate in a niche or sphere which they care about.
However, at the end of the day, you’ll need to talk cold, hard numbers. How much return can you reasonably expect to generate for your investor(s)? It’s important not to guess or overshoot here, but to ground your estimations using thorough market research, revenue forecasting and expense calculations. Is there any competition which you can refer to, providing “real-life” examples of success in your industry/sector?
This might be a challenge for many EIS startups, since the arena you’re entering might be entirely new and so there is little information to draw on. Here, our team at Bure Valley Group can bring our experience and skills to assist you with this crafting process. Certain, key components which you might want to include are:
- Milestones. What do you aim to accomplish with the EIS investment, and how long will it reasonably be expected to take?
- Terms. Which key, tangible benefits will investors get for their money?
- Use of funds. What, explicitly, will you use their funds for? Do you expect they will be happy with what you tell them, and why?
- Funding goal. How much do you need to move towards your next business stage?
If you are a successful investor looking for EIS investment opportunities, or if you are a business owner looking for funding, then we’d love to hear from you.
Get in touch today to start a conversation with our team, and discuss some of the great investment memorandums we have available:
+44 160 334 0827