Question

List and define five of the key sections of a start-up business plan created for the purpose of attracting outside investors.

Answer 1

The five of the key sections of a start-up business plan created for the purpose of attracting outside investors are:

1. Board members: This section of a business plan for a startup gives an idea about who are the founder members of the firm and what is their expertise. This gives us the knowledge about their past record and how can their competencies be utilized in the future.

2. Current traction: This section shows how much work has a firm done in the market and expanded itself since inception. This also shows how much the product or service been accepted by the buyers and given feedbacks. Based on this, we can have a fair idea about what is the acceptability level of the idea in the future.

3. Industry Analysis: This refers to the industry attractiveness and ease of working in a particular industry. Higher the threats, thin are the chances of surviving in the industry. A better tool to judge the same is Porter's five forces.

4. Valuation: This section provides the current value of the firm as described by the future projected cash flows. The cash flows are projected based on certain assumptions and discounted back to-day to find the per share value of the firm.

5. Utilization of funds: This section refers to how the firm wishes to utilize the funds it is seeking to source. The usage can be marketing expenses, capital expenditure, salary expenses or discounts to customers.