While the principles of smart investing are fairly straightforward, implementing these principles can be difficult at times. That's primarily because of our emotions. When the market falls, fear tempts us to sell. When the market rises, greed tempts us to take more risk. One of the best steps to minimize the impact of emotion in investing is to develop a written investment plan. If your plan is: (1) based on sound investing principles, (2) written when you are in an objective, level-headed mood, (3) tailored to your specific circumstances and goals, and (4) if you're married, developed with the input and buy-in of your spouse, then it will. Below are suggestions for writing such a plan (and yes, actually writing it down is important!).
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I have been told by several restaurant plan owners that many of their patrons return just being for a piece of my cake. I have made several other pastries that have been appreciated too. I believe i can create a smoothly run business that would give substantial financial benefit to us both if I had the funds to pay two full-time employees and buy some equipment. My business would require a mixing machine and bigger ovens. I have enclosed a simple brochure that shows what i am doing now as well as a business plan for expanding. I would like to meet you and give you more information about my venture as well as one of my cakes. I can be reached anytime at. Thank you for your time. Sincerely, senders signature senders name list of enclosures such as a brochure or business plan by andre Bradley related Articles. Wise investing is often simple, but it isn't always easy.
No original documents should be sent. Sample Investment Proposal Letter Senders Name senders Address City, state, zip Code date investors Name Investors Address City, state, zip Code dear Name of Investor, It write has been brought to my attention that you are a strong investor in local businesses. I have been told of several businesses that got their start with your backing. At present, i am running a baking business from my home, but the demand for my cakes has become much more than i expected, and I would like to expand my business. I sell my homemade cakes to local restaurants. They are basically chocolate cakes that are vegan and gluten-free, but they are so tasty, everyone enjoys them. Restaurants are happy to be able to offer this option, and I have been asked to supply a national chain of restaurants.
Recommended by, investment, experts, they also need to include essay in the letter: the full terms of the investment contract, an exact description of the uses of the money with lists and budgets. The expected results of the investment, the distribution of income or profits. Any other investors and how much they invested It is recommended by investment experts to include something the investor should do at the end of the letter. For example, express the desire to meet the investor in person, give contact numbers and request a meeting at their convenience or offer further information on request. Here is a sample investment proposal letter for a small business. It should be sent by certified post, so the sender has a record of the time it was sent and received. All enclosures should be copies.
If they dont, but their management team does, they should mention. If there is nothing to mention, it can be avoided for now. The letter can mention if the venture idea has global appeal. The letter can give information on the return on investment and when the investor can expect to see. Before writing the letter, the details of the business need to be completely thought out. This may mean creating a business plan. The letter should not be based on hopes and dreams, but on hard facts that show the investment will be profitable. If the person is seeking a very large investment, they should organize the letter with an introduction, description of the investment, the terms of the investment, the expected returns, a contingency plan and the financial projections on a spreadsheet.
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People who need money to begin a business or other venture may send an investment proposal letter that is intended to get the developer attention of investors and convince them to invest in the venture. A well thought-out and written investment proposal letter may bring the investors running and demanding to discuss the venture further. Some points that should be considered when a person writes a proposal letter are: The proposal should make a confident pitch that sounds like the venture will make money. Even during a recession, investors are looking for ways to make money, and if the proposal sounds like it will, they will be interested. The letter should be clearly and simply stated. Even if the opportunity for investment is really good, if the letter is complicated with too much detail, it most probably will not be considered.
Simple words are better than acronyms or jargon. . The letter should clearly state what business sector the venture. For example, people may think google is in the software sector, but it is actually in the advertising sector because most of its revenue comes from advertising. . The proposal should clearly express the funding requirements and how the money will be spent. It should state how much money is needed and why. These are questions an investor will ask, and its a good idea to have the answers right in front of him. If the person writing the letter has special education, experience or skills that will help make the venture a success, they should mention.
What will happen if it does? Do you have a backup or alternative plan? Tips to help you win funding. Keep these tips in mind to help you win the funding you are searching for:. Spend extra time working on the executive summary.
Because bankers and professional investors receive so many business plans, they sometimes go right to the executive summary for an overall view of what your plan is all about. If you cant seize their interest in your executive summary, go back to the drawing board and try again. Make sure your business plan is complete. You'd be surprised at how many business plans are submitted with important data missing. You need to double- and triple-check to make sure all the important components are included. Even when using business plan software, people skip sections or decide an area isn't important. Leave nothing to chance.
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How much control are you willing to relinquish to investors? When will the how business turn a profit? When can investors, including you, expect a return on their money? What are the projected profits of the business over time? Will you be able to devote yourself full time to the business financially? What kind of salary or profit distribution can you expect to take home? What are the chances the business will fail?
Many businesses never make it past the planning stage because their would-be founders, as part of a logical and coherent planning process, test their assumptions and find them wanting. Test your idea against at least two variables. First, financial, to make sure this business makes economic sense. Second, lifestyle, because who wants a successful business that they hate? Assessing your companys potential, answer the following questions to help you outline your companys potential. There are no wrong answers. The objective is simply to help you decide how letter well your proposed venture is likely to match your goals and objectives. What initial investment will the business require?
additional funding. Having justification for what you put in your plan is essential for winning over someone reading. Random ideas get random results. Well-thought-out, justified ideas get serious consideration. Its also advantageous to take a few minutes to make sure your company has the potential to succeed before digging for those hard-to-get dollars. For most of us, our desires about where we'd like to go aren't as important as our business's ability to take us there. Put another way, if you choose the wrong business, youre going nowhere. Luckily, one of the most valuable uses of a business plan is to help you decide whether the venture you have your heart set on is really likely to fulfill your dreams.
First, it helps convince potential sources of funding that the entrepreneur has thought the idea through. It also gives any actual investors a set of financial benchmarks for which the entrepreneur can be held accountable. In a sense, a business plan is a ticket to enter the financial dance. It would be overly simplistic to say that you must have a plan to get funding. But its not too simplistic to say that a good plan will help you raise your funds more quickly, more easily and more completely than you could without. Before seeking investors, you need employability to know exactly what you're seeking and where that money will be spent. Not unlike justifying expenses when sending your taxes to the irs, you need to justify the amounts you're asking for and be specific - investors aren't simply writing out checks with no idea of where the money will be spent. Sure you can ask for a little more than you need in hopes that the negotiating brings you down to the amount you truly need for funding. Or something reasonably close.
Writing a, business Plan?
Featured Article, thanks to all authors for creating a page that has been read 187,072 times. Did this article help you? November 6, 2014 5 min read. In the book, write your Business Plan, the staff of Entrepreneur Media offer an in-depth understanding of whats essential to any business plan, whats appropriate for your venture and what it takes to ensure success. In this edited excerpt, the authors offer tips on creating a business plan you can use when seeking financing for your business. A business plan is almost essential for entrepreneurs who are seeking to raise money employability to help fund their companies. In fact, business plans are so closely tied to fundraising that many entrepreneurs look at them as suited only for presenting to investors and overlook the management benefits of planning. But for those entrepreneurs who are seeking funding, a business plan accomplishes several things.