Post a new topic
    6 Replies Latest reply on Dec 11, 2007 2:04 AM by Lighthouse24

    Business Plan to Request Capital for Startup

    MakingIt Newbie
      Hello everyone,

      I am currently preparing my first business plan. I have estimated my start-up assets and expenses and see where I need about $30K to begin my business. My question is, when preparing the financials to show the start up costs, do you show the needed capital as a negative or is there another form of calculating it that presents it in a positive light.

      If I am going about this wrong, please be gentle. I'm nervous enough as is. :)

      Thanks in advance for any input received.

      ~MakingIt
        • Re: Business Plan to Request Capital for Startup
          MakingIt Newbie

          Since asking my question, I continued to do some additional research. I found a great link that I thought I would share to the forum and any other that may have this same question at a later date.

          http://money.howstuffworks.com/startup-capital.htm

          This link is extremely helpful, easy to read and comprehend. (Much easier than those Finance classes I now wished I would have paid closer attention to!)

          I'm very willing to read any responses this question may generate as well.

          Thanks again.
            • Re: Business Plan to Request Capital for Startup
              LUCKIEST Guide
              Glad that you answered your own question. Everybody has a different answer.
              SCORE is a great help in preparing Business Plans. SCORE is FREE and you
              can contact them on line or in person.
              GOOD LUCK, LUCKIEST
                • Re: Business Plan to Request Capital for Startup
                  MakingIt Newbie
                  Thank you, Luckiest.

                  I'm still interested in any responses individuals may have. Yes, I am familiar with SCORE.org. I'm utilizing their website as well as our local Small Business Development Center. It's apparent I will need to pay closer attention to accounting and finance moreso than my 'niche'.

                  For anyone who may have difficulty in the area of writing a business plan, not only as a requirement but as a learning tool, I highly recommend the "howstuffworks" link. I'm loving the sample Excel spreadsheets they have for much of the financial information needed for a thorough business plan and overall business assessment.

                  I hope to learn from others on this site as well. (Where is everyone?) :)

                  ~MakingIt
              • Re: Business Plan to Request Capital for Startup
                Lighthouse24 Ranger

                One of the things a business plan is intended to do is outline how much money you'll need to start-up the business and operate it until it becomes profitable. Whether those costs are a "negative" or a "positive" depends on how well-founded and accurate they are. If the plan contains vague estimates that can't be broken down and itemized, or if specific types of costs are understated or left out of the plan altogether, then the plan isn't really much of a plan -- and that's a negative. On the other hand, if the plan contains a detailed, accurate, and valid set of cost projections, it not only helps you analyze the profit potential of your new business, it provides credible evidence to anyone else who may be analyzing it as well (e.g., lenders and investors).

                When people don't know enough about the businesses they are starting to accurately project and explain the costs in detail, that's a potential negative -- and they usually address it in one of three ways:
                1. They take a guess and wing it (which is about as easy to hide from potential lenders as a zit on the forehead);
                2. They invest the time to learn and gain more experience (maybe by working for someone else in the same business) before taking the leap into business ownership themselves;
                3. They seek out the help and input of someone who already has that experience and expertise in order to complete their plan (which may be available for free, or it may involve some type of paid mentoring or consulting arrangement).

                 


                Bottom line, a credible set of cost projections is a "positive" thing. I hope this helps. Best wishes to you!
                • Re: Business Plan to Request Capital for Startup
                  Lighthouse24 Ranger
                  Just a follow-up message . . . wondering how your plan is progressing. Please update us when you can. Thanks!