A business plan cover letter should be persuasive and provide a summary of the business and its purpose, including the desired investment amount and expected return. It should also outline the product or service, target market, long-term strategy, and exact amount being sought from potential investors. The letter should be enticing enough to persuade the investor to read the complete business plan.
A business plan cover letter provides a summary of the purpose of your business and how you intend to achieve it. The public is often a potential investor or group of investors. Given the purpose and audience, the letter should be persuasively written and detail the desired investment amount, as well as the type of return the investor can expect to receive.
Selling a business plan to potential investors is the purpose of a business plan cover letter. The investor must be convinced that the business plan is carefully constructed and has significant market potential. The name and a description of the business should be included in the first few sentences.
Within the first paragraph of the cover letter, the reason for contacting the prospective investor should be stated. Also, a brief summary of the product or service the company will be offering should be provided. Details of how the company will serve the market competitively should also be included in this paragraph.
A summary of your target market and how it will be reached could be included in the second paragraph of a business plan cover letter. At the very least, the letter should provide a rationale for how the company will become profitable. Potential profitability can be communicated by highlighting numerous competitive advantages, unmet market needs, or market test data.
Your business plan cover letter should also state a long-term strategy. A summary of where the company intends to be in three to five years is vital for a potential investor. Having plans for business growth and expansion can be an attractive selling point. Linking the nature of the business to the interests of a potential investor is also a good idea. For example, if an investor has a strong interest in the welfare of underprivileged children and your business plans to service that segment, this information should be included in the cover letter.
When writing a cover letter for a business plan, you should also include a paragraph outlining the exact amount you are seeking from potential investors. Details should be provided as to why this amount is needed and how it will be used. A compelling cover letter will often indicate what the investor will get in return. For example, you can trade a percentage of stocks or shares, or you can provide a return on your investment over a specific period of time.
The ultimate goal of a business plan cover letter is to get an investor to provide funds for your business. In addition to being informative, the letter should highlight the positive aspects of the business plan without going into too much detail. The cover letter should state that the complete business plan is attached for further review and be enticing enough to persuade the prospective investor to actually read the plan.
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