What information will I need to supply to funders?
Once you’ve selected the relevant funder and received indicative terms from them, you will need to prepare a pack which will effectively be your sales and marketing document to help you achieve the funding required. This pack will need to include the following:
- The story covering the business and it’s progress to date – this is the summary including a copy of the Information Memorandum (IM) document which will give the funder a good overview of the current business as of today.
- Future developments – where you see the future of the business in general terms but also, more specifically in terms of new sectors, new products/services, any necessary R&D, projected sales and profits. It will focus on where you wish to take the business in the future, including the “big picture” overview.
- Sales and marketing plans – these are the detailed plans covering sales by division/product/sector and corresponding costs and ultimately net profit figures.
- Cashflow forecasts and profit projections – these show the “nuts and bolts” of how you’re going to get to the sales projections and the underlying costs and net cashflows on a month to month basis. This will identify and pinch points in the business where you might need additional funding resources or working capital facilities from your bank or external funder.
- Your own personal CV and that of any key team members – self explanatory really. The CV explains your background to date, both in terms of specific companies, dates of employment, roles you’ve occupied, any relevant professional qualifications, etc. The reader should be able to see how relevant to the business/sector you are and the level of seniority you’ve achieved in your career to date. It should be no more than 3 pages long, be succinct and very readable.
- A SWOT analysis outlining strengths, weaknesses, opportunities and threats – this is a detailed analysis of the business in relation to it’s sector, the specific markets in which it operates, it’s competitors, product/service development opportunities, etc
- Historic financial information on the business in question – this will be the previous 4 years annual statutory accounts which have been filed at Companies House (for UK registered companies). There is no need to analyse these – funders will be happy to receive them in their original format. This gives the historic position and will show any trends in sales, costs and profit/loss.
- Evidence of your personal funds to enable you to make a capital injection – you will need to be able to demonstrate that you have liquid capital to undertake a transaction to the tune of at least £100,000. If the funds are not currently liquid, then details of any funds or properties held will be required. Funders prefer funds to be liquid in order that there are no delays waiting for an asset to be turned into liquid cash. Properties can take a long time to sell. Shares in other companies can be very difficult to exchange into cash, particularly in the short term.