The first thing a business plan writer must get right is understanding which target audience the plan is for.
Sometimes a business plan can be written to appease one specific target audience, whilst others might be written for two target audiences. In the situation your plan is required for two opposing target audiences, it’s always best to write the plan for the primary audience, then create a second copy revised to meet the secondary audiences requirements.
In this article, we’ll explain the nine target audiences of a business plan, and their specific expectations based on this sequence of business plan styles: investment, bank loan, immigration, grant, strategic, and operational.
1. Angel Investors
Angel investors can be a fantastic asset to any startup. It is usually a challenge of finding the right angel investor for a specific startup company. When writing a business plan for an angel investor you’re best off following the traditional business plan format or to use a pitch deck.
Most angel investors have seen hundreds if not thousands of business plans and will be looking for a few standard questions to be answered. These questions will be surrounding the experience of your management team, market cycle, competition, risks, expected return on investment, and your exit strategy.
2. Venture Capitalists
This audience invests in technology startups that offer a high ROI (return on investment). A business plan should only be written for a venture capitalist (VC) firm when the business concept is technology-based, or if you’ve found a very niche venture capitalist that funds businesses outside of the technology industry.
When writing a business plan for a VC it’s important to display a large market size, intellectual property (IP), scalability, and a minimum one million USD investment.
3. Family and Friends
When seeking an investment from family and friends, also known as “love money” you are morally and legally responsible to display the risks involved with the business. This may include business continuity (in case yourself as the business operator falls ill), if planned business objectives aren’t met, and any other scenario that might go wrong. Click here to learn more about a few of the common risks investors should be aware of when funding a startup.
Bankers, and financial institution representatives are looking to fund businesses that can clearly exhibit they have performed adequate market research on the demand for their product or services. Additionally, bankers look for a focus on financial projections with an outlook of typically three years, including an opening balance sheet, income statement, cash flow statement, breakeven analysis, financial ratios, compensation projections and a contingency plan.
5. Government Immigration Agencies
When writing a business plan for a government immigration agency you must ensure that you are applying under the appropriate program, and that your business plan meets the specific criteria of the chosen program. Governments can range from federal, provincial, and state levels where nearly all will carefully examine how your venture can create growth in local employment, supply-chain, advance diversity, and increase taxation revenues.
6. Government Grant Agencies
Much like government immigration agencies, government grant agencies are looking to support companies that will generate benefits to the local economy. Similarly, you must research the proper government grant and whether, or not your company meets the qualifications. When writing a government grant business plan be sure to focus your plan on research and hard facts. Government representatives are typically looking for a solid business model, and evidence-based points instead of selling to them.
7. Your Management Team
Typically a business plan written to your management team would be of the strategic nature. It’s imperative to focus your efforts on the who, what, where, why, and how’s of your business. Precisely, what is the market opportunity? Why are we here? Who is our closest competition? Where are we taking the company? How are we going to get there? It’s imperative your management team understands the strategy of your business as this will affect key decisions and positioning as the company develops. Incorporate your management team throughout the development of the business plan, and be sure to introduce new management team members to the plan with the rest of your corporate team.
More and more business plans are written which are then presented to specific departments of universities. We’re at an exciting time where universities are partnering with companies to develop breakthrough science and technology. When writing a business plan with an academic audience you should include similar breakthroughs and studies completed at other institutions. Take a scientific approach to presenting your company’s efforts and specific focus’. If your proposition is attractive enough the university might be enticed to joint partner with your business, exchanging their capabilities for an ongoing study.
9. Your Company at Large
In nearly every circumstance it’s advantageous to present your business plan to your entire team, whether that’s to three people, or a hundred people. The most common type of business plan to share with a company at large is the operational business plan. An operational business plan focuses on the functionalities of a company, expanding on location, logistics, human resources, and operations. When writing an operational business plan clarify who is doing what, at which time, and how success will be measured on a monthly or quarterly basis.
To Conclude The 9 Target Audiences of a Business Plan
We hope you enjoyed our article on the nine target audiences of a business plan. Our final recommendation would be to explore these very different audiences and to ask yourself why you are choosing them. Once you are confident in writing to a specific target audience, look into their expectations, criteria, and pain points. There is a fine line between writing in a convincing way and ensuring you are telling the truth. Take an evidence-based approach, that utilizes studies and your own market research to ensure your target audience is ready to support your business and help take it to the next level. Please reach out with any questions, or to inquire about the best business plans available.