Sample Business Proposal Be Careful
Sample Business Proposal Be Careful
Every entrepreneur was there. You need to create a business plan to get your idea off the ground and have no idea how to approach it. The first thing most people do is google, “sample business offer”. Why? Well, it’s really easy. They want to gain a head start by looking at what someone else has written. It’s an understandable position you should take when you’re under pressure and need a boost. What people do not realize is that using a sample store offer is dangerous.
There are many very good examples of business proposals on the Internet, but there are also some scary bad examples cited as first-rate efforts. Having worked as a professional banker and investor for the past 20 years, I can say this with a degree of confidence.
The bottom line is that even if you come up with a great example, it’s not relevant to your unique business or the market momentum that’s relevant to your business idea. The parties that evaluate your proposal and decide whether they want to invest are usually well educated and experienced. Every month, you read hundreds of these documents and you can see a Copy & Paste job for miles around.
Does a sample business offer help me?
Using a sample business offer is fine if you are just looking for tips on how to structure your own offer. Of course, this is based on the fact that the example fits well with your business and is a good example. If you look around the internet for business proposals, it is a good bet that you are not sure what a good and what a bad example is. Because of this, you can borrow heavily from a bad example, which actually hurts your efforts.
Nowadays, there are too many people on the internet who offer quick solutions or shortcuts for making business proposals to attract funding. All in all, these solutions are not enough to get funding. Here is the reason:
1. Encourage entrepreneurs to use other people’s business proposals as a template that reduces originality and may result in the collection of irrelevant data.
2. They cause entrepreneurs to skim the research component, leading to a proposal that is incoherent and does not provide a coherent business principle.
3. An example of a business offer as a guide means that the entrepreneur is not fully involved in the business planning process because he has only a fleeting understanding of the details of his offer.
4. It does not prepare the entrepreneur for a detailed survey of his business strategy and the related financial projections.
We have all too often seen this in presentations for stock financing. Obviously, if someone does not fully understand the proposal and it destroys the credibility and trust of the investor, it virtually nullifies your chances of persuading an investor to part with their money.
How should I use a sample business offer?
We strongly believe that using a sample business offer is not a good idea, unless you are just looking for a structural overview. Even in this case, you would need to scan a fairly broad cross section of examples to get a representative sample to form an independent opinion. There is nothing more frustrating than a playing field that does not flow and in which the entrepreneur clearly “flies”. That’s why we rejected more seats than anyone else.
We recommend that you use a sample business offer only when you contact a bank to obtain financial information that provides an example of the information you want. However, banks do not provide samples, but provide templates. Basically, they try to train entrepreneurs before they submit a funding application. In this case, the bank advocates a structure for the offer so that it is fine. However, there are still gaps to fill, so it is not a complete solution to your problem.
How does the audience know that I used a sample?
This is a common question that we are asked, and while we can not speak for the entire investment community, we can refer to our own experience as investors and former bankers. Here is a list of the top ten reasons why a sample was obviously used:
1. Executive Summary is boring and formulaic, without telling us why we should invest.
2. The market information does not match the specific demographic characteristics of the offer or is outdated.
3. The entrepreneur’s knowledge of market dynamics is sketchy in the survey, and it is clear that what he has written in the proposal is the sum total of his knowledge on the subject.
4. Information about target customers is not based on empirical facts, but rather on observation opinions.
5. The competitors’ analysis is outdated and does not pursue smaller competitors or industry trends that could provide opportunities.
6. The business strategy is not intuitive with the financial projections of the business. Financial anomalies are common.
7. The degree of analysis in the financial section is low. The lift analysis (observation comments only) is a blatant sign that no detailed analysis has been performed.
8. The language style in the business proposal is inconsistent and at different times.
9. The content structure of the business proposal is not intuitive. Remember to fit a square pin in a circle!
10. The proposal does not contain final conclusions or valid arguments for the investment (or award). Lack of analysis leads to inadequate risk mitigation, leaving many questions unanswered.
What is the solution?
This may seem a little bleak, but there is a simple solution to this dilemma, and it takes a little more time and effort to better understand your business. You need to learn to write a business offer rather than using a sample business offer for a short cut. Do not do the latter, as this will make the experience of turning to investors and financiers unnecessarily painful and affect your experience of rebuilding your vision from scratch and diluting your strategic understanding of your own business. In addition, you will be found out!
The truth is that it is not rocket science. Even knowing the key points will greatly improve your finished product. Writing a business proposal is a logical process that can not be completed within 8 hours or 1 day, at least not if you really hope to understand it and pass it on effectively to external parties. In fact, writing a business proposal is a very rewarding experience. If you are serious about starting a business and attracting finance for this business, this will be associated with a pressure to perform. As you go through the business planning process, you learn to be more active and strategic and ultimately enhance your chances of making your vision a reality by properly and consistently analyzing your business.
An example business offer can not and will not prepare you for it.
Ceilia Murtin Managing Director of Business PlanIt