You understand the inner workings of your business, have a brilliant idea, and one hundred percent back its potential. But you’re wondering how to attract investors by presenting a compelling case for why your project is worth their money.
A recent EY pulse survey revealed that 93% of CEOs plan to increase (70%) or maintain (23%) investment in corporate venture capital funds in 2024. This growing interest not only expands the pool of available capital but could also open doors to lucrative exit opportunities through mergers and acquisitions.
This article will guide you in structuring investment proposals, presenting financial projections, and highlighting your competitive edge to get the money in the bag.
Key takeaways
- Investment proposals focus on securing funding for specific projects, while business plans outline overall business strategy.
- Conducting a market and competitor analysis and gathering customer insights demonstrate industry understanding.
- A unique value proposition emphasizes what makes your product or service stand out and why it’s the best solution for your target market.
- Tailored proposals based on investor interests and priorities result in higher engagement and credibility.
- Transparency and realistic projections address risks openly and use data-backed forecasts to move the contract forward
What is an investment proposal?
An investment proposal is a formal document or presentation that outlines a potential investment opportunity. It is designed to persuade potential investors, stakeholders, or decision-makers to allocate funds or resources to a specific project, venture, or asset. The proposal typically provides a comprehensive overview of the investment, including its objectives, expected returns, risks, and benefits.
Investment proposal vs business plan
When we hear investment, we think of money. An investment proposal and a business plan may seem related, but they serve distinct purposes, as they differ in purpose, scope, audience, and detail.
The investment proposal is a sharp spotlight, designed to win over investors with the promise of returns, like bait on a hook. It hones in on one project or opportunity, showcasing financial potential, risks, and rewards.
On the other hand, a business plan is the scope of the entire operation - an umbrella overview of the business’s mission and strategy. It’s the playbook for success, meant to steer owners, partners, and lenders.
Essentially: Whether it's for start-up or franchise opportunities, the proposal secures funds; the plan lays the groundwork. The proposal zooms in on funding a single initiative; the business plan maps out long-term goals, serving as an all-inclusive management tool.
If you need some more guidance check out our article on start-up marketing strategies.
What you need to do before writing an investment proposal
Conduct market research
An integral part of every proposal, market research demonstrates that you understand the landscape and can spot opportunities where others might not. How do you spot opportunities? By zoning in on these:
- Industry analysis: Use resources like Statista, IBISWorld, and government reports to gather data on market size, trends, and growth forecasts.
- Competitor analysis: Identify direct and indirect competitors. Examine their strengths, weaknesses, pricing strategies, and customer feedback. Tools like SWOT analysis can help frame this information.
- Customer demand: Use surveys, focus groups, and online tools such as Google Trends to understand what customers are looking for and how much they’re willing to pay for it.
- Market gaps: Identify underserved segments or issues your competitors haven’t addressed. Highlight these gaps in your proposal to position your offering as a necessary solution.
One money-saver (in the spirit of money talk) is conducting your own research using survey tools like SurveyMonkey or Google Forms. They’re cost-effective and customizable, letting you gather real-time insights without breaking the bank. With built-in analytics and a wide reach, you can tap into a goldmine of feedback from anywhere.
You’ll want to create a spreadsheet to track industry data, competitor details, and customer feedback.
Once you’ve got all the juice, compile a report summarizing your key findings (use data and charts here). The juice will be worth the squeeze!
Deep dive into your product/service
Your product or service is the star of the show, right? (Yes, you back it, remember!) Without a thorough understanding of its strengths and weaknesses, you can’t convince investors of its value.
Spend time fleshing out your:
- Problem-solution fit: Clarify the problem your product solves and why your solution is unique.
- Unique Selling Proposition (USP): Define what makes your offering stand out from competitors. This could be price, quality, innovation, or a unique feature. Make sure your USP is compelling and easy to communicate.
- Product roadmap: Highlight not only the current version but future developments. Investors are interested in scalability and innovation.
How can you make all of this actionable?
Write a one-page summary outlining your product’s key features, benefits, and the problem it solves. Create a visual or mockup to demonstrate the product or service in action (bringing your vision to life like a sneak peek behind the curtain). A great selling point is to prepare a comparison chart showing your product vs. key competitors.
Get to know your audience and buyer personas
Understanding your target audience is important (and often overlooked). Investors want assurance that you’ve thought through who will buy your product and why. The main question here: Who is your ideal customer? You would look at:
- Demographics and psychographics: Understand age, gender, income levels, and preferences. Combine this data with deeper insights into their interests, values, and motivations.
- Buyer persona creation: Create detailed profiles that include the customer’s goals, challenges, and decision-making processes. According to Forrester Research, businesses that use buyer personas see a 73% higher conversion rate.
- Customer journey mapping: Identify the steps customers take from awareness to purchase, and show that your proposal accounts for how you’ll engage them at each stage.
Conduct customer interviews or analyze feedback from your existing user base to refine these profiles. Develop a customer journey flowchart to illustrate how potential buyers will move through the sales funnel, from first discovering your product to making a purchase (and hopefully becoming a loyal advocate).
Research your potential investors
Your network is your net worth. Investors are more than just a source of capital—they’re strategic partners. Understanding what they’re looking for helps you tailor your pitch and build trust. Investigate, explore, probe, and learn as much as possible about them.
- Investment preferences: Learn about their preferred industries, investment sizes, and whether they lean toward early-stage or growth-stage funding.
- Past investments: Check to see where they’ve invested before can help you determine if your project aligns with their portfolio.
- What they value: Some investors prioritize innovation and technology, while others are drawn to high ROI or social impact. Knowing what drives them helps you emphasize those aspects in your proposal.
To make each step easier, create a portfolio for each potential investor that includes their background, investment history, and preferences. (Use LinkedIn to understand their professional interests and values). You can then personalize your proposal by addressing how your project aligns with their interests and goals.
Must-have components of an investment proposal
While you should customize your investment proposal for prospective investors and your brand, there are a few must-have inclusions.
- Executive summary: Punchy and short, the summary should grab attention and leave investors wanting more. Highlight a mix of both important and enticing details to make them eager to read on.
- Business overview: Provide a snapshot of your company’s mission, vision, and goals. Paint a vivid picture of who you are and what sets you apart, laying the groundwork for why investors should care about your journey.
- Product/service overview: Dive into what you’re offering and why it matters. Showcase your product or service as a solution to a specific problem and highlight its unique features. Make it so irresistible that investors can’t help but see its potential.
- Market analysis: Show you know the lay of the land. Detail industry trends, market size, and the competitive landscape. Highlight opportunities and gaps in the market to position your venture as the answer to an unmet need.
- Investment opportunity: Outline the amount you need, how you’ll use it, and the return investors can expect. Present your opportunity clearly, with a dash of confidence that says, “This is worth your bet.”
- Business model and strategy: Explain how you make money and your roadmap for growth. Investors want to see a business model that’s solid and a strategy that turns vision into reality.
- Marketing and sales strategies: Demonstrate how you plan to reach and convert customers. Use specifics to show that your approach isn’t just theory but a well-oiled machine ready to launch. Highlight key tactics that will generate leads and build brand loyalty.
- Financial projections: Paint a realistic picture of your financial future. Include revenue forecasts, profit margins, and break-even analysis. Think of these projections as the financial compass that guides your growth, ensuring investors feel confident in the direction you’re headed.
- Risk analysis: No venture is without risk, so own it. Address potential challenges and outline your strategies to manage or mitigate them. Show that you’re aware, prepared, and ready to tackle obstacles head-on.
- Team introduction: Spotlight your team’s skills, experience, and why they’re the right people to make this venture succeed. Investors invest in people, not just ideas, so make sure your team’s expertise shines as brightly as your business opportunity.
How to write a proposal for investors: Expert tips
Tell a story
It’s quite simple, a story humanizes your business. They evoke emotions, which by proxy will make your proposal memorable. While facts inform, emotions compel action. So, with a creative stance, investors are much more likely to remember and connect with a narrative about solving a pressing problem or achieving a compelling vision than a dry delivery of data.
Highlight your unique value proposition
Your value proposition is the backbone of your pitch—the essence of what makes your business indispensable. It’s not just about stating what you do but why it matters and why it’s better. Define with precision why your product or service isn’t just another choice in a sea of options, but the go-to solution your target market craves.
This is your chance to stand head and shoulders above the competition, showing not just what you offer but why it’s irreplaceable. Back your claims with evidence—testimonials, metrics, or case studies—and leave no doubt in the investor’s mind that your venture isn’t just viable but vital.
Tailor your proposal to different investors
Not all investors are cut from the same cloth, and their priorities can vary as widely as their portfolios. Some may be deeply committed to high-growth startups in emerging tech, while others value stability in industries like real estate or energy.
Before you even begin crafting your proposal, dig a little! (or, a lot) What industries excite them? Do they lean toward quick exits with high returns, or are they more interested in long-term partnerships and sustainable growth?
One massive bonus to tailoring your pitch shows investors you respect their time and interests. Customize not just the content but the tone—seasoned investors may prefer hard data and projections, while newer or impact-driven ones might respond better to narratives and vision.
Focus on ROI
Show me the money.
Let's be candid—investors care about returns. They’re not just funding a vision; they’re seeking tangible rewards. To address this, clearly lay out the expected return on investment (ROI), specifying timelines, percentages, and payout structures. Be honest - overstated promises will raise eyebrows and hurt credibility.
Tools like Qwilr’s ROI calculator and sales growth calculator can help refine your estimates, providing precise, professional calculations. Frame your ROI pitch by tying it to your business’s growth potential, highlighting how their investment creates value and why it’s a worthwhile risk (or a worthwhile reward!).
Address risks with transparency
Expand on risk and reward—no investment is without risk, and pretending otherwise can put you on the back foot. Instead, acknowledge potential challenges—be it market volatility, operational hurdles, or competition. Use this opportunity to demonstrate your foresight by presenting mitigation strategies, contingency plans, and fallback options. Transparency here isn’t a weakness, because trust is the currency of business.
Investors will undoubtedly appreciate your ability to anticipate and navigate challenges, showing that you’re not just optimistic but prepared.
Back up claims with data
Bold claims are meaningless without solid evidence. Investors are looking for data-backed insights that give them confidence in your business’s potential. What can you provide them with? Clear metrics, historical performance, and customer feedback! Or, as we know already, market research to validate your assertions.
Incorporating interactive data elements like dashboards can add visual appeal and depth to your presentation. With Qwilr’s proposal templates, you can embed these elements, allowing investors to dynamically explore the data themselves—no room for doubt here.
Provide a clear exit strategy
The endgame matters as much as the journey. Investors need to know there is a planned approach for either them or a business owner to cash out of their investment or ownership stake—ideally at a profit. It’s all about reaping the rewards!
Lay out a clear, realistic exit strategy that aligns with your business model—whether it’s a merger, acquisition, or public listing. Include timelines, potential buyers, or scenarios that lead to liquidity. A compelling exit strategy reassures investors that you’re thinking ahead and are focused on delivering tangible outcomes.
Show off your team’s expertise
You’re not only selling yourself, you’re selling your team. This is your opportunity to highlight key team members, showcasing their credentials, achievements, and relevant industry experience. Include real examples of their leadership and problem-solving abilities. If your team includes industry veterans or advisors, emphasize their roles. A strong team signals to investors that their money is in capable hands and that your business is equipped to handle both challenges and growth.
Display realistic financial projections
One phrase that hits the nail on the head here: we need to balance ambition with likelihood. Financial projections are more than numbers—they’re your business’s future, quantified.
Provide detailed revenue forecasts, profit margins, cash flow estimates, and break-even points. Ensure these figures are supported by market trends and operational insights.
Avoid overly optimistic estimates that may raise red flags; instead, demonstrate how each number connects to achievable milestones. Realistic projections show investors you understand your business’s financial landscape and provide a roadmap to sustainable growth. So rather under-promise and over-deliver.
Investment proposal template
You’ve got to spend money to make money, and presenting your pitch with flair is an investment in itself.
Tailor each section to fit your project’s specifics, proving that you’ve left no stone unturned. Embrace all elements and features and integrate images, videos, and other multimedia components into your template. Qwilr’s investment proposal template is fully customizable to ensure your pitch is unforgettable. What’s included?
- About us
- Product
- Market
- Business model
- Funding requirements
- Team
- Contact us
Secure investments with outstanding proposals
An investment proposal acts as a golden ticket, opening doors to vital funding and partnerships. It’s your chance to showcase potential, tell your story, and demonstrate why your venture is worth backing—after all, fortune favors the bold.
Qwilr offers a range of customizable templates that make presenting your investment opportunity a breeze. Streamlines the entire process of proposal writing so you can focus on what really matters - making your vision come to life. Sign up for a free trial and see how effortless it can be to craft a proposal that stands out.
About the author
Brendan Connaughton|Head of Growth Marketing
Brendan heads up growth marketing and demand generation at Qwilr, overseeing performance marketing, SEO, and lifecycle initiatives. Brendan has been instrumental in developing go-to-market functions for a number of high-growth startups and challenger brands.
