However, even assuming that a business can avoid these pitfalls, the routes to securing investment at the moment is challenging. There are so many businesses looking for funding that sources of debt or equity funding have a wide choice over which to spread their risk.
So how do you get your business proposition noticed? Well, here are a few ideas.
1. Be realistic and avoid extravagant claims - it may be that you are the next Green, Branson, or whoever but most people are not. Avoid claims you cannot substantiate. Small can be very profitable and attractive. Don't overstate your own position or the claim for your product or service.
2. Show a clear path to profitability and exit - investors like to see measurable milestones against which the progress of the business can be measured and funding drawn down. If you don't have financial or commercial awareness your business will fail without someone with executive authority to work along-side you.
3. Show clearly how you are going to use your funding - investors and banks do not like to see large pots of money allocated randomly across the board. They like to see how, specifically, the funding is going to be used and the anticipated outcomes of that funding.
4. Show a solid cash-flow and a good ROI. Worst case scenario is that the business fails to meet targets, runs out of cash and doesn't deliver anything back to those who have invested time and effort into its growth (p.s. that includes you). Be realistic, don't ask for too little money and if the Return on Investment is not good you should question why you are doing it... and asking others to back you.
5. Keep it Simple - don't claim world domination of a market in 3 years. Instead, make sure the core of the business is deliverable & profitable and also highlight potential upsides once the business is established.
The rest is down to you. A backer needs to believe in you - and specifically that you can deliver. There is no point over-selling yourself - you will be found out. Tell it how it is and your vision of how you want it to be but make sure it is rooted in reality. Too many people over-promise and under-deliver - don't be one of them. It is easy to lose your credibility and very hard to get it back.
The Business Plan Team