Thursday 16 December 2021

Financing business plan Model

The whole content of the financing business plan can simply be summed up as a central idea: that is, the hope that private equity funds can invest in target companies, enterprises can bring private equity funds a viable return on investment returns. every enterprise that wants to finance must make a financing business plan in the financing process in the light of its own business actual situation and around this central idea.

Financing business plan (model financing business plan)

The basic contents of a complete financing business plan are as follows:

Summary of the financing business plan

The summary of the financing business plan is what private equity fund managers see first, so it must be at the heart of the main content of the financing business plan, the essence of the financing business plan, it must have the attraction of making investors interested and want more information about the enterprise.

Content brief is the basic characteristics of the summary, must be written in concise and accurate language summary, in the production must strive to control the completion of the summary in about 2000 words. the summary includes the following:

1, the basic information and contact information of the enterprise;

2, business operations;

3, enterprise summary;

4, management team and management organization;

5, the product's industry situation and market;

6, financing instructions;

7, financial planning and analysis (including capital use and profit forecast);

8, exit mechanism.

The enterprise and its future

This section will cover most of the business. the core content that private equity funds want to understand is the uniqueness of the business and the dynamic impact of this uniqueness on the future earnings outlook of the business, i.e. the key factors that private equity fund managers can be confident of in the industry-wide competition through their understanding of the uniqueness of the business. the scope of the enterprise and its future covers a wide range of topics, including the following:

1, the enterprise's overview: refers to the name of the enterprise, the establishment time, registered capital, the actual capital in place, including cash, intangible assets as a proportion of shares, such as the place of registration, the nature of the enterprise, the main business, historical evolution, the development stage of the enterprise, equity structure.

2, the nature of the business: a brief description of the main business engaged in the enterprise, and the corresponding products or services to give a brief description, so as to make private equity fund managers as far as possible to understand the enterprise's products or services.

3, business development history: including the production of products or services, the important stage of enterprise development and development process of major events.

4, enterprise prospects: can be described in chronological order of the future business development plan, and pointed out the key stage of development. in this part, investors such as private equity funds generally need to understand the business direction of the business in the next few years and the reasons for its changes.


If the enterprise expects the future business development to be subject to many variables, it should explain the conditions necessary for the success of the enterprise development.

5. The product or service originality: the uniqueness of the enterprise can be expressed in the management team, can also be expressed in the product or service, can also be reflected in the financing structure and financing arrangements. in short, only if the product or service is unique, it is possible to have a good profit prospects.

6. Price of a product or service: a description of the pricing strategy of an enterprise's product or service, including the price of the product, the basis of the price formation, cost, profit and profit composition. private equity funds need to understand whether product pricing takes into account all factors, including the composition of prices, whether they are logically acceptable to the market, whether product pricing reflects price movements under competitive conditions, and whether prices can withstand pressure from market price reductions, and so on.

7. Customer group characteristics: including customer characteristics description, purchase motivation, the main buyer of the product and its purchase amount and single purchase volume.

8. Product market description: mainly to describe the product market. including the industry's total sales and growth rate, market share, etc., private equity funds can control the company's share of the market.

9. Competitors or substitutes: describe and analyze all competing products and manufacturers, especially their market share, annual sales and financial strength.

In addition, the advantages of the company's products need to be analyzed. some companies may not have competitors for the time being because they have a patent or franchise, but there may be stronger competitors or alternatives in future investment horizons, so private equity funds must understand potential competitors and choose when and how they will enter the market. private equity funds will carefully assess the sustainability and reliability of their growth if they do not know much about their competitors.

10. Marketing strategy: focus on the description of product sales process and distribution channels, the basic links include: enterprise sales methods, advertising strategy, market penetration strategy, sales barriers, sales staff composition. based on this analysis and evaluation of the market marketing strategy of enterprises, private equity funds to understand the product from the production site to the user's hands of the whole process.

11. Production process: the manufacturing process of products and its influencing factors, focusing on the production capacity of enterprises, production key links, quality control and production processes, and on this basis to the production costs and sales costs of enterprises to confirm.

12. Human resource composition: including the labor resources and status quo of the enterprise, as well as the form of employees required to produce and sell products. the main contents include: employee geographical distribution, employee education, employee training plan, salary cost, allowance and year-end dividend, employee-management relationship, union situation, working time arrangement, proportion of technical personnel, confidential contracts and competition prohibited contracts, employee incentive mechanism, etc.

13. Suppliers: the enterprise's raw materials and necessary parts supply situation, including raw materials suppliers, raw material supply channels, special external components and key purchase parts supply is timely and reliable. a list of suppliers, including their name, address, telephone number, primary contact, maximum supplier and supply amount, as well as key suppliers and sole raw material suppliers, should also be provided.

14, Equipment: the basic condition of the necessary equipment for the production of enterprises, including the enterprise has or intend to buy the main equipment, total fixed assets and realized value, the use of existing equipment to achieve the output and output value, equipment procurement cycle, equipment procurement difficulty, equipment installation difficulty and due to the operation of special technical needs, equipment speciality and mortgage value, equipment maintenance costs, equipment depreciation speed, equipment technology update speed and equipment competitive advantage.

15. Asset composition and capital: including the current type of fixed assets of the enterprise and the investment needs of future fixed assets, asset collateral status, depreciation of fixed assets, current production capacity and income, fixed assets related to financial leases and lease agreement documents.

16. Intellectual property rights, such as patents and trademarks: the circumstances of patents and trademarks held or to be applied for by the enterprise to determine whether the enterprise is truly unique.

17. Research and development: including expenditure on research and development, funds already invested and intended for future investment, and a description of the purpose and effectiveness of the investment in such research and development.

18. Disputes involved: whether or not an enterprise is involved in or is likely to be involved in various disputes, such as commercial debt relations, user prosecutions and patent disputes.

19. Government management: in some special industries, government regulation may have a significant impact on the future development of enterprises, such as the production of pharmaceutical or special import and export products, the need to disclose relevant government regulations and regulations.

(iii) corporate management team

The status of the corporate management team, including directors, supervisors, managers, and other key personnel such as core technical personnel.

1. management resume: general manager, deputy general manager, finance director and other senior managers and key personnel list, including their name, age, position, experience, education level.

2. manager's professional ethics: the enterprise needs to provide the management's past litigation and dispute materials, especially whether the management, directors, supervisors and major shareholders have bankruptcy or bad credit history.

3, the manager's remuneration expenses, that is, directors, supervisors, senior management income, as well as board fees, consulting fees, commissions, dividends and salaries and other expenses.

4, share arrangement: whether the enterprise to the internal enterprise management personnel stock option arrangement. for members of the enterprise management who already enjoy stock options, they should list the number of options, the average strike price, the number of options that have been executed and the number of options that have not yet been executed.

5. employment contract: the labor contract involving the key employee, the reason and length of employment, and the various welfare arrangements of the employee.

6. conflict of interest: fully disclose whether there are kinship, family management issues and other conflicts of interest between senior managers and shareholders of the enterprise.

7. consultants, accountants, lawyers, loan banks: lists of consultants, accounting firms, law firms, loan banks and their related persons, names, addresses, contact numbers and fees.

8, enterprise management organizational structure, department functions and other aspects of corporate governance structure.

9, the construction of corporate culture system related to the situation.

Financing needs and related notes

1. The proposed financing method: the enterprise's choice of investment vehicle intention, as well as the corresponding conditions and details, should provide targeted programs for the subsequent financial arrangements and structural design to provide a basis.

if common stock is sold, it should be clear: the type of common stock, whether dividends are distributed, whether dividends can be accumulated, whether shares can be redeemed, the price of shares and the accompanying voting rights;

The offer of preferred shares, it is necessary to explain: dividend payment methods, whether there is a repurchase arrangement, whether it can be converted into common shares and the corresponding conversion price, preferred shareholders' rights, etc.;

If convertible bonds are sold, the term of the claim, the interest rate, and the price and proportion of the converted shares should be clearly stated, and in the case of stock options, listed: purchase price, option execution price, number of shares purchased, option validity period, etc.

2. Capital structure: changes in the capital structure of enterprises after obtaining private equity fund funds.

3, financing mortgage and guarantee: whether the enterprise is willing to provide the corresponding collateral to obtain private equity fund funds, whether the enterprise can provide personal or company guarantee for financing: in the case of personal guarantee, provide proof of personal property, and in the case of enterprise guarantee, provide the enterprise's capital verification report.

4. Business report: mainly introduces the enterprise after obtaining the private equity fund investment in what way to report to the private equity fund management, such as: provide monthly profit and loss statement, balance sheet or annual audit financial statements.

5. The use of funds plan: enterprises for the next few years of funds and the use of the funds detailed planning.

6. Ownership: the financing business plan shall list the number of existing shareholders' shareholdings and the number of shares held after the private equity fund has invested, and give the price of ownership;

7. Fee payment: the investment process occurred in the consulting fees, lawyers fees and other fees and payment methods.

8. Private equity fund to enterprise management intervention: Private equity funds generally require a certain seat on the corporate board of directors, if enterprises want private equity funds to enterprise management more deeper intervention, you can explain here, and explain what aspects of enterprise value-added services, as well as to provide these value-added services paid for.

Entrepreneurs, we are looking for high-quality project equity investment and financing cooperation.

1: agriculture (planting, breeding, old-age care) focus.

2: energy conservation and environmental protection, new energy, new materials

3: Chain restaurants, trade, cosmetics industry.

4: internet of things, internet of things, app industry.

5: medical equipment, bio medicine, health industry.

6: culture, education industry.

7: business, tourism, mining, real estate

8: innovative traditional industries.

9: automotive industry chain. 10: high profits, high growth and state support

Financing business plan (model financing business plan)

If you need to do equity financing please contact the author

Risk factors

Explain the main risks faced by companies, and while private equity foundations doubt their objectivity and judge independently based on their own experience, the issues raised by companies contribute to the evaluation of private equity funds. risks in general include:

  • The operating period is short, if the enterprise has just been established, the business history is short will be the main risk content discussed between the two sides.
  • Management experience, if management is young, or just entered the field, this may lead to inexperience.
  • Market uncertainties, sales-related market uncertainties.
  • The production uncertainties, any production uncertainties should be explained.

Debt risk.

Enterprises should analyze the debt situation of enterprises and whether there is sufficient liquidity, so that private equity funds to confirm that if the enterprise in trouble and had to go bankrupt, the investment can be recovered how much.

Depending on the core person of the enterprise, the enterprise should explain to the private equity fund the negative impact that the departure or death of any of the core figures of the enterprise will have on the enterprise;

Return on investment and exit

Private equity funds are not investing for investment, but for return on investment, so companies should describe to private equity funds the way to eventually exit.

For private equity funds to withdraw from the investment enterprise exit mode, enterprises should also look at the issue of investment exit from their own point of view, especially the different exit mode of choice on the possible impact of enterprises.

Issue of shares listed: 


The issue of shares listed is undoubtedly the most desired outcome of both sides of investment and financing, but also the most difficult, the socialization of the company's share capital after the listing of private equity funds to hold some or all of the shares to cash out. financing enterprises should formulate plans for issuing shares and listing, such as listing time, listing location, listing method and so on.

Mergers and acquisitions: 

The mergers and acquisitions are also an important way for private equity funds to exit target enterprises, especially in the capital market downturn, it is difficult for enterprises to list shares through public offering in the short term, the sale of shares of enterprises to strategic investors and other investors is also an important way for private equity funds to withdraw from the enterprises they invest in.


Refers to the purchase of shares owned by private equity funds in enterprises by the invested enterprise at a pre-agreed price or pricing method after several years of investment in the target enterprise, in order to realize the withdrawal of private equity funds.


Private equity funds into the target enterprises, if there is no listing, can not carry out inter-enterprise mergers and acquisitions and target enterprises buy-back cases, private equity funds in what circumstances can be recovered through enterprise liquidation investment.

(7) operational analysis and forecasting

Enterprises should carry out a comprehensive analysis of the current operating conditions and project prospects of the enterprise, that is, according to the financial data of the enterprise, describe the financial situation of the enterprise in recent years, including net income, sales costs, operating expenses, interest expenses and interest income, and classify these data, so that private equity funds can clearly understand the business situation and future development prospects of the enterprise.

(8) Financial statements

For companies in the growth and maturity stages, providing a complete set of financial statements is important for private equity funds to understand their financial position, especially if the financial statements have not been reviewed by an independent auditor. 


Typically, financial statements include consolidated balance sheets, consolidated income statements, cash flow statements, and off-balance sheet items. through the financial statements, private equity funds can grasp the financial ratio, operating results, solvency, accounts receivable, liabilities and so on.

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