Writing an effective business plan for an investor presentation

Prajakt Raut
7 min readSep 19, 2022

A business plan is ‘YOUR Plan for YOUR Business’. It is not a document or excel sheet that you make separately for the investors. It is a plan that you should prepare for yourself. An investor pitch deck is simply a presentation that captures the essence of that plan.

Writing down your business plan helps you think through the assumptions clearly. And often the act of thinking and writing helps you identify impracticalities in the thought process.

Here’s what I have seen works as a simple process for creating your business plan

Start with a thesis — ‘a story about why what you are planning is important’ –Why are you driven to do this venture. What is the gap that you are seeing in the market which needs to be fixed. Why is this important. (Don’t get into numbers yet. Just focus on the problem/opportunity and how addressing that will make life better/efficient for the stakeholders). Focus on the ‘WHY’.

‘See the film in your mind’ about your venture — how do you want to address the problem/opportunity, how large do you want it to be, what will make you happy, what are your aspirations, etc. Imagine it as a business a few years down. This gives you a good view of ‘what you want to aim for’.

Create a product/solution roadmap: Identify a rough (NOT DETAILS) framework of the product/solution that you think will address the problem or opportunity you have identified. Do not mix it with the business model or pricing or execution models, etc. Just focus on what you think an ideal solution for the opportunity should be. And because not all the aspects of the product/solution can be created initially, work on a CLEAR road map on what aspects of the product/solution could be launched when. Priorities based on what is important to deliver on the value proposition and also based on what is practical for you to implement with the current resources you have (or can gather, including initial capital).

Work out rough milestones and goals: Your long-terms goals and aspirations should be broken into short-term and long-term milestones, which are the stepping stones to your eventual destination.

Think deeply of how you will implement it: This is the critical aspect of planning your implementation. This also gives you a view of the cost structures, the infrastructure & people needs, processes, etc.

Think of what the business and organization might look like in say 3–5 years, and create an org chart. You will obviously not have the money or people for this fully loaded org chart. But having one allows you to create a view of who will multi-task on what aspects as per the product/solution roadmap that you have envisaged.

Work out the ‘structure’ of an excel sheet: Now, after you have done the thinking, it is time to use an excel sheet to evaluate if there is a business case in what you plan to do. Before you start entering numbers, work out the ‘structure’ detailing every cost head and revenue stream.

Segregate every aspect of the business into a different row. I.e. instead of putting broad-brush revenue numbers, break it into 4 rows — number of new customers, total customers, average revenue per customer.. and hence total revenue. Of course, depending on the nature of your business, the dynamics and hence the number of rows will differ.

If you have more than one solution/product or more than one customer segment, work on the revenue assumptions for each separately, even if you eventually fold all of it into one in a summary sheet.

Start working in the excel sheet — assumptions are critical: An excel sheet exercise with the wrong assumptions is going to give you a very wrong direction, and perhaps wrong hopes. Be realistic. Be conservative.

Work on multiple ‘scenarios’: Life does not play out the way you plan it. Real life situation will be different than your excel sheet plans. It is therefore essential for entrepreneurs to work out multiple scenarios to see how the business will pan out under different outcomes.

Finally, articulate it into the ‘presentations’: Once your ‘Business plan’ is ready, you then articulate it into different presentations. Even an executive summary is one articulation of the B-plan. You can have an executive summary for introductions, a 8–10 slide ppt for first meetings and more detailed documents and presentations for follow-up meetings where specific details are going to be discussed.

Broadly speaking, a business plan should communicate the following to an investor:

  • The problem you are addressing, and why that is important.
  • Your solution
  • Your target customer
  • How big is the opportunity
  • The business case — revenue streams, pricing, cost structure, Take rate/contribution margin/gross margin, etc.
  • Why does your business have a reasonable chance to be a leader in this market
  • How large do you see the company growing to — what is your own aspiration for the company? Broad summary numbers for at least 3 years (not the detailed excel sheet).
  • Why are you the right team for the investors to invest in?

Your goal in the first business pitch presentation to an investor should be to convince the investors that what you are doing has a reasonable chance of being dominant player in a large market.

The initial pitch presentation (this could be a PowerPoint or a word document) should not be more than 8–12 slides, covering the points mentioned below. In the initial pitch deck, the details of execution and numbers are not necessary. No investor is going to decide to invest in the first presentation. All they will be checking for is if this startup is worth evaluating more deeply, and hence your expected outcome from the initial meeting with an investor should be to get the next meeting.

In your pitch deck do you talk about future markets that can be addressed by the product? Yes. Your business case is based on what the potential for your concept/product/core competencies are for the future. You may have a focus on a particular segment/geography/opportunity/problem at the beginning of your journey, however, if the possibilities of multiple revenue streams and adjacent or parallel opportunities exist, that should be included in the pitch deck.

This can be added in the slide about ‘size of the opportunity’, where you can give an overview of what possible opportunities, including new markets and new customer segments, exist for the concept that you are currently proposing.

Remember, the market opportunity is different from your plan for your venture. Think of it this way… if you were working at Accenture or McKinsey and were to present a report on the size of the opportunity to a large multi national company, what would you say? The opportunity is open to all… the MNC may have a better chance of addressing that opportunity, and your plans may be different. But the opportunity is the same, whether you address it or not.

How much detail do VCs want to see in a business plan. It depends on what stage of the discussion you are at with the investors. If it is the first meeting, they are not interested in the details. At that stage they are keen to understand the team, the business overview, your aspirations and plans to meet those aspirations, the market potential, your view of the opportunity, the business traction so far, business case at a broad numbers level, etc.

If all of the above seems positive, and if they are keen to pursue this further, then they would be keen to understand in detail the numbers behind your plans. Even more important than the numbers is the logic behind those numbers. Hence, even if you do not present it, you do not have a choice of not preparing a detailed excel sheet outlining costs and revenues and knowing it well to discuss about it.

Some points to remember about a business plan

  • A business plan is not a product. It is a process.
  • Entrepreneurs have to understand the business dynamics around the concept. Just domain expertise without understanding of how business works is not enough.
  • Investors are interested in ‘how you will do what you intend to do’, rather than just knowing what you are planning to do.
  • The quality of your business plan is dependent on the quality of your assumptions. If your assumptions and logic are incorrect, no amount of great planning will help.

A good idea or a good plan? What do startup investors invest in? Investors will be interested because you have a plan to address an opportunity well, and not just because you have identified an opportunity that is interesting.

That’s why while having a good idea is certainly a good starting point, and will be of interest to investors, they will eventually invest only if you have a good plan to implement the idea. And of course, that plan has to have an underlying business potential and business case.

Connect with me on LinkedIn on https://www.linkedin.com/in/prajaktraut/ if you have comments or questions about my views in this article or any of my other posts.

To download a free PDF of my book on Starting Up and Fundraising, click here.

By Prajakt Raut — Managing Partner Supply Chain Labs — A sector-agnostic fellowship fund investing in startups disrupting supply chain, and Founder applyifi.

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Prajakt Raut

Managing Partner — Supply Chain Labs. Founder Applyifi. Entrepreneurship evangelist.