Every entrepreneur has been there. Create a business plan to get your idea off the ground. Most people search for “Sample Business Proposal” on Google. Why? It’s quite easy. It’s a way for them to see what others have written and get an advantage. This is a common position if you’re under pressure or need an extra boost. However, it is important to realize that using a sample proposal for a business idea can pose inherent risks.
While there are many excellent examples of business proposals online, some very bad ones are being cited as best practices. I know this after 20 years of being a professional investor and banker.
Even if you find a great example, it will not be relevant to your business or the market dynamics related to your business idea. Parties reviewing your proposal and deciding whether to invest in it are usually well-trained and experienced. They can spot a copy-and-paste job in a mile and read hundreds monthly.
Can a sample business proposal help me?
If you’re looking for ideas on structuring your business proposal, it is okay to use a sample proposal. This depends on the fact that the sample is relevant to your business and is a good example. Likely, you need to know a good and bad examples when searching the Internet for business proposals. You may take inspiration from a poor example, which can detract from your efforts.
Too many people offer shortcuts or quick fixes to help you prepare business proposals that attract funding. These solutions will not get you funding. Here’s why:
1. They encourage entrepreneurs to avoid copying other people’s business plans as templates. This can dilute the proposal’s originality and lead to irrelevant data inclusions.
2. These can lead to entrepreneurs skimming the research portion, which leads to a proposal that needs to be more cohesive and make a coherent business case.
3. A sample business plan is a great guide, but it detracts the entrepreneur from fully engaging in the business planning process. They will only have a superficial understanding of the details.
4. This will not prepare entrepreneurs for in-depth questioning about their business strategy or financial projections.
This has been a problem in many equity finance presentations. This is very obvious when an investor needs help understanding your proposal. It can destroy credibility and trust and almost negate your chances of persuading them to part with their money.
What is a Sample Business Proposal?
If you’re only looking for a basic outline, there are better ideas than using a business proposal sample. To form an independent opinion, you must look at various examples. Nothing is more frustrating than a pitch that doesn’t flow or where the entrepreneur seems to be “winging it.” This is the reason we have rejected so many angles.
If you approach a bank to get finance, we recommend they give you a sample business proposal. Banks don’t provide samples; they offer templates. This is basically how they educate entrepreneurs before they apply to finance. This is the bank approving the structure of the proposal. However, it only partially solves your problem.
How will the Audience know that I used a sample?
This is a question that we often get asked. While we can’t speak for all investors, we can draw on our experiences as former bankers and investors. Here are the top ten reasons it is obvious that a sample was used.
1. The Executive Summary is boring and formulaic, but it needs to communicate why we should invest.
2. The market information needs to be updated with the proposed demographics or updated.
3. Under questioning, it becomes clear that the knowledge of entrepreneurs about market dynamics could be more solid. The contents of their proposal are the sum of their ability.
4. Information about target customers is based on something other than empirical facts but more observational opinions.
5. Competitor analysis must be updated to track minor competitors, industry trends, or other opportunities.
6. The business strategy needs to align with financial projections intuitively. These financial anomalies are common.
7. Low level of analysis is found in the financial section. An Elevator analysis is only observational comments. This indicates that a thorough investigation needs to be done.
8. The language style used in the business proposal needs to be more consistent. It uses different tenses.
9. Regarding content layout, the structure of the business proposition needs to flow more naturally. Try to fit a square peg inside a circle.
10. The proposal does not make a clear conclusion or provide sound arguments to lend (or invest). A lack of analysis can lead to insufficient risk mitigation, leaving many unanswered questions.