3 R’s of Turning Around an Almost Unbankable Business Proposal
Tons of business proposals ended up in the trash everyday. Entrepreneurs, business owners, and investment brokers may ask, just what are the investors looking for? The answer might just be a question in itself – Is your project bankable?
If you know your business proposal has ended up in the trash, or about to suffer that state, what can you do to turn it around?
Reinvent your proposition
Reinventing your business proposition – This requires research and revisiting your initial proposition. You will have to ask yourself what you are lacking in your idea. It may be difficult to do this alone, validation with another person or third party may help you to see things from different perspectives.
If you are looking for an equity investor, strategic partner, or debt financing for your project, you may wish to ask if you are making an attractive offer. Most often than not, entrepreneurs and business owners are afraid of losing too much of their equity, yet ask for too much in return, which is usually a huge red flag. The proportion of shares owned by whom, amount of debt, financial ratios and returns are sometimes the next red flags of rejection. Business owners need to put themselves in the shoes of the other party, turn the tables around and ask themselves if they would have gone for this given such an offer. If they won’t, they would probably have to restructure their offering.
This process goes hand-in-hand with the restructuring process. All business owners and entrepreneurs first need to find out the cost and returns of investment, how long it takes for breakeven, etc. and improve their financial models to obtain the optimal scenario for all, this is to convince not only themselves but the recipient of their business proposal.
If you have gone through this honestly and diligently, and have now improved your business proposition. Hope for the best, and do not be afraid to go through the same process for the third or fourth time.
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