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May 29, 2011

Getting an Angel Investor to Notice You

You will need more than a business plan to raise the capital to start your business. The key is being able to “hook” your investor in the first five seconds. Great, how do you that?

Taking a look at the first section of the business plan, its called the executive summary. The executive summary has to do one thing: Make it so that your targeted investors is compelled to read the rest of your plan.

To achieve this you need to do it in three steps:

  1. Describe what your business does
  2. Present a clear image of your market
  3. Show why your business is the answer to what that market is looking for

First, summarize the summary – you do this with short concise sentences and bullet points:

Click here to raise money from Angel Investors!

Tell exactly what your business does quickly and smoothly. Make it so that they understand your goal in the first two sentences. This is the first impression, and it needs to be thought of as the “Ahhh haaa” moment for the investor. Get straight to the point and make sure they “get it.” In the later paragraphs you are going to explain your business more, right now you are going to move to the market description. Here is an important tip: Use your high concept pitch to create the first two sentences. Your high concept pitch is a phrase made up of two elements, a familiar brand followed by a twist. For example, the movie Aliens was promoted as “Jaws in Space!”

State the size of your target market. Establish the number and monetary value of prospective customers and the rate at which those figures will increase in the future.

Now explain why your company is uniquely qualified to fill the needs and wants of your market. This can include the fact that you have put together an experienced management team all with prior successes in similar industries, as well as technologies that will increase efficiencies that will improve upon current industry best practices, as well as the speed of access to underserved markets.

Click here to raise money from Angel Investors!

Once you have written the “lede,” it is time to expand on the description of your business. This is where you will talk a little more about how your company will do what it says it is going to do. Bare a few more bones of the business, but don’t do a full exposure that will come later in the Company Analysis portion of the business plan.

Next you will want to give a few more details about your target market. Convey who you market is and what it is that they need. Lay out the demographics of your market and the psychographics, this includes age, marital status, income, number of children, location, ethnicity, what is they crave and what motivates them. You must show the investors what is your market is missing and how you are going to give it to them.

Lastly you are will present the unfair competitive advantage. These are defined by Growthink, a business development consulting firm that has helped entrepreneurs raise more than a billion dollars in capital since 1999, as world class management team, proven operational system, proprietary technology, long term contracts, key partnerships and other success to date information.

Remember, the vital piece that will help you land angel investors is the executive summary. This is why the executive summary should cut right to the chase and the heart of the investor, avoid wasting words. You don’t need to explain everything in the first section; all you want to do is say enough to entice them to read the rest of the plan. This will help maximize the odds that your business plan will be read by possible investors.

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