funding request for business plan examples

• Search Search Please fill out this field.
• Building Your Business
• Becoming an Owner
• Business Plans

How To Write the Funding Request for Your Business Plan

What goes into the funding request, parts of the funding request, important points to remember when writing your request, frequently asked questions (faqs).

MoMo Productions / Getty Images

A business plan contains many sections, and if you plan to seek funding for your business, you will need to include the funding request section. The good news is that this section of your business plan is only needed if you plan to ask for outside business funding. If you're not seeking financial help, you can leave it out of your business plan. There are a variety of  ways to fund your business  without debt or investors. Below, we'll cover how to write the funding request section of your business plan.

Key Takeaways

• The funding request section of your business plan is required if you plan to seek funding from a lender or investors.
• You'll want to include information on the business, your current financial situation, how the money will be used, and more.
• Tailor each funding request to the specific funding source, and make sure you ask for enough money to keep your business going.

The funding request section provides information on your future financial plans, such as when and how much money you might need. You will also include the possible sources you could consider for securing your funds, such as loans or crowdfunding. Later, you can update this section when you need outside funding again for business growth.

An Outline of the Business

Yes, you've done this already in past sections, but you want to give potential lenders and investors a recap of your business. In some cases, you might simply share the funding request section so you need to have your business details such as what you provide, information about your target market, your structure (i.e. LLC), owners' and members' information (for partnerships and corporations), and any successes you've had to date in your business.

Current Financial Situation

Again, you've provided some financial information in the financial data section , but it doesn't hurt to summarize. If you're submitting just the funding request, you'll need this information to help financial sources understand your money situation.

Provide financial details such as income and cash flow statements, and balance sheets in your funding request section.

Offer your projected financial information as well. If you're asking for a loan for which you'll be offering collateral, include information about the asset. If the business had debt, outline your plan for paying it off. Finally, share how you'll pay the loan or what sort of return on investment (ROI) investors can expect by investing in your business.

How Much Money Do You Need Now and in the Future?

Indicate what type of funding you're asking for such as a loan or investment. Outline what you need now and what you might need in the future as far as five years out. 

How Will the Funds Be Used?

Detail how you'll be using the money, whether it's for inventory, paying a debt, buying equipment, hiring help, and more. If you plan to use the money for several things, highlight each and how much money will go to each.

Most financial sources would rather invest in things that grow a thriving business than things that pay for debt or overhead expenses. 

Current and Future Financial Plans

Current and future financial plans include items such as loan repayment schedules or plans to sell the business. If you're getting a loan, outline your plans for repayment (although most lenders will have their own schedules). If you have plans to sell the business, let the lender know that and how it will affect them. Other issues to consider are relocation (if you move) or a buyout. Finally, let investors know how they can exit the deal, such as cashing out (and how long before they can do that).

You're asking for money, so you need to always be professional and know your business inside and out. Here are some other things to keep in mind:

• Tailor your funding request to each financial source : Lenders and investors need different information, such as loan repayment versus ROI, so create different reports for each. 
• Keep your funding sources in mind : Each resource will have different questions and concerns. Do a little research so you can address them in your report.
• Ask for enough to keep your business going : Don't be stingy, as you don't want your business to fail from a lack of money. At the same time, don't be greedy, asking for more than you need. 

How do you request funding for a nonprofit?

Most nonprofits seek funding in the form of grants. Write a grant proposal that includes information on the project or organization, preliminary budget needs, and more. Be sure to format it with a cover letter, proposal summary, the introduction of the organization, problem statement, objectives, methods, evaluation, future funding needs, and the budget.

What are three methods of funding?

Grants and scholarships, equity financing, and debt financing are the main three methods of funding for small businesses . Grants and scholarships do not need to be repaid and are often best for nonprofit organizations. Equity financing is when you receive money in exchange for ownership and profits. Debt financing is when you borrow money that needs to be repaid.

Want to read more content like this?  Sign up  for The Balance’s newsletter for daily insights, analysis, and financial tips, all delivered straight to your inbox every morning!

Small Business Administration. " Fund Your Business ."

Congressional Research Service. " How To Develop and Write a Grant Proposal ."

Library of Congress Research Guides. " Types of Financing ."

Funding Request

An outline of the future funding requirements of a company

What is a Funding Request?

The funding request section of a business plan is an outline of the future funding requirements of a company. Usually, the time scale is limited to the next five years, especially in cases of startups with an uncertain future. Information needs to be provided about the company’s future financial plans, such as the amount of funding required at different phases or the different sources of capital.

• The funding request section of a business plan is an outline of the future funding requirements of a company.
• The name and nature of the company, location, owners, service or product offered, target audiences, etc., must be included in the section.
• It must specify if the company is looking for a short-term loan or an investment in exchange for stake and/or board membership.

Writing a Funding Request

1. business summary.

A business summary is only required in cases when a funding request is being created as a standalone document. The name and nature of the company, location, owners, product or service offered, target audiences, etc., must be included. In cases of established companies, past achievements can be highlighted.

2. Amount Required

The amount required section includes a ballpark figure of the total funding required at the moment and whether the company plans to raise capital again sometime in the near future. It must specify if the company is looking for a short-term loan or an investment in exchange for an equity stake and/or board membership.

Future requirements must be calculated after accounting for existing resources and income channels, if any. Usually, companies estimate their requirements five years down the line to arrive at a figure. The amount is usually negotiable; companies may leverage shareholding, fixed assets , or interest rates for the same.

3. Future Plans

The future plans section includes the specifications of where the funding, if any, will be spent. Funds can be needed for working capital, geographical expansion, recruitment drives, building machinery or buildings, advertising, and so on. Several hidden aspects may be involved, and it is important to include any eventualities that may affect the cost of the aforementioned things. They may relate to the anticipated appreciation of property rates, tightening of government regulations , the imposition of tariffs, etc.

4. Financial Information

The financial information section is only required in cases when a funding request is being created as a standalone document. In case a business plan is being prepared, all information will be covered under the financial information section of the plan.

The financial information includes historical data such as income statements , debt repayment history, etc. Forecasts about future needs are also included here. Any activities that may negatively or positively impact the company’s ability to repay loans or deliver results promised, such as relocation, expansion, or mergers and acquisitions, need to be included here.

The terms section covers how the company expects to pay back a loan or produce deliverables for investors. It is important to provide lenders with a potential exit plan from the company, which may include cash outs or Initial Public Offering (IPO) plans. The process is extremely important from the investor’s perspective, as it provides them with a chance to minimize risk and maximize their profit.

Key Factors to Remember

There are a number of important factors to consider when preparing a funding request, including:

1. Target audience’s perspective

It is important to consider the target audience’s perspective when writing a funding request. Applying for a loan is very different from approaching an investor or a potential partner, as they involve different contract terms, amounts of money, or types of funding.

A bank may look at past credit history , existing sources of secured funding, and income statements. On the contrary, an angel investor may focus more on the business concept and associated risk, while a venture capitalist may want well-modeled projected cash flows.

2. Accuracy

The financial section of the plan may come in handy while preparing a funding request. It is important to be conservative in one’s estimates of future growth potential or market size, especially when approaching investors. False claims about the potential of a product and unrealistic estimates of consumer engagement are likely to drive away investors.

3. Consistency

It is important to be consistent about the financial requirements at the different stages of the venture. One must request enough funding to cover all costs fully, to avoid a situation where one is unable to achieve organizational objectives. At the same time, one must not set the requirement too high, as experienced investors usually have a fair idea of the value of the concept.

More Resources

CFI is the official provider of the global Financial Modeling & Valuation Analyst (FMVA)®  certification program, designed to help anyone become a world-class financial analyst. To keep learning and advancing your career, the additional CFI resources below will be useful:

• Cash Flow from Financing Activities
• Executive Summary
• Private Equity vs Venture Capital, Angel/Seed Investor
• Startup Valuation Metrics
• See all management & strategy resources
• Share this article

Create a free account to unlock this Template

Access and download collection of free Templates to help power your productivity and performance.

Already have an account? Log in

Supercharge your skills with Premium Templates

Take your learning and productivity to the next level with our Premium Templates.

Upgrading to a paid membership gives you access to our extensive collection of plug-and-play Templates designed to power your performance—as well as CFI's full course catalog and accredited Certification Programs.

Already have a Self-Study or Full-Immersion membership? Log in

Access Exclusive Templates

Gain unlimited access to more than 250 productivity Templates, CFI's full course catalog and accredited Certification Programs, hundreds of resources, expert reviews and support, the chance to work with real-world finance and research tools, and more.

Already have a Full-Immersion membership? Log in

AI ASSISTANTS

Upmetrics AI Your go-to AI-powered business assistant

AI Writing Assist Write, translate, and refine your text with AI

AI Financial Assist Automated forecasts and AI recommendations

TOP FEATURES

AI Business Plan Generator Create business plans faster with AI

Financial Forecasting Make accurate financial forecasts faster

INTEGRATIONS

QuickBooks Sync and compare with your QuickBooks data

Strategic Planning Develop actionable strategic plans on-the-go

AI Pitch Deck Generator Use AI to generate your investor deck

Xero Sync and compare with your Xero data

See how easy it is to plan your business with Upmetrics: Take a Tour  →

AI-powered business planning software

Very useful business plan software connected to AI. Saved a lot of time, money and energy. Their team is highly skilled and always here to help.

- Julien López

BY USE CASE

Secure Funding, Loans, Grants Create plans that get you funded

Starting & Launching a Business Plan your business for launch and success

Validate Your Business Idea Discover the potential of your business idea

E2 Visa Business Plan Create a business plan to support your E2 - Visa

Business Consultant & Advisors Plan with your team members and clients

Incubators & Accelerators Empowering startups for growth

Business Schools & Educators Simplify business plan education for students

Students & Learners Your e-tutor for business planning

• Sample Plans

WHY UPMETRICS?

Reviews See why customers love Upmetrics

Customer Success Stories Read our customer success stories

Blogs Latest business planning tips and strategies

Strategic Planning Templates Ready-to-use strategic plan templates

Business Plan Course A step-by-step business planning course

Help Center Help & guides to plan your business

Ebooks & Guides A free resource hub on business planning

Business Tools Free business tools to help you grow

How to Write the Funding Request for Your Business Plan?

Startup Fundraising Checklist

• May 7, 2024

Funding requests are one aspect where the “under promise and over deliver” phenomenon might not work.

Set your business valuation too high, and investors might not invest. In contrast, value it too low, and you might end up receiving way less than what you’re truly worth.

Moreover, if I were to invest in your business, I would want to know why you are raising funds and how they will be used.

In short, a well-planned funding request with the purpose of fund-raise and a realistic ask is key to securing funds. You cannot mess up.

Need help writing the funding request for your business plan ? Here’s our quick guide on writing a compelling and realistic funding request to ensure you don’t miss out.

Let’s dive right in.

What is the funding request?

The funding request section of a business plan is an official section for the organizations to ask for new funding. It outlines the amount of funding needed, the purpose of the funds, how they will be used, and in what timeline they will be used (generally for 5 years).

The main goal of a funding request is to secure the necessary capital to start or expand a business, fund a project, or achieve a specific objective.

How to write your business plan funding request

How you write your funding request heavily depends on why you’re raising funds—the purpose. So, before you start writing, be clear about your requirements and the purpose of fundraising.

Your purpose can be hiring new staff, getting the latest equipment, launching a new product, or starting or expanding a business.

Once you do that, you may start working on your funding request; follow these steps:

1. Provide business information

Start by providing a brief overview of your business. I know—you’ve already included all the information in the prior sections, but adding it here would be an opportunity for you to give your investors a little recap.

No, it does not get redundant—It doesn’t have to be. So don’t worry.

Moreover, sometimes, you only need to send the funding request, not the entire business plan. In such cases, such information makes sense and comes in handy.

So, here’s what you will have to explain in the funding request section of your business plan:

• Target Market
• Your business structure like LTD, LLC, or more
• Brief about your product/service
• Partners involved
• Business heir, if there exists.

Say goodbye to old-school excel sheets & templates

Make accurate financial plan faster with AI

Plans starting from $7/month

2. Present the current financial situation

You might have provided some financial information in the financial section. But, you have to add some figures here anyway. Not only will it be contextual but easier to have a clear picture in one place.

Here are some financial details that you will have to include in this section:

• Quarterly as well as yearly cash inflow and outflow
• Balance sheets
• P&L statement
• Expected financial condition in the upcoming quarter and year
• Include the list of assets and their ownership details if you are asking loan from the bank or applying for any grant
• Break-even point
• If your business is in debt, explain the situation in detail and brief plan for paying it
• Mention how much return on investment can they expect
• In the end, mention how will you pay off the loan or transfer the ownership of the business

3. Announce how much funds you need

When you explain the situation in brief and have all the facts and figures put aside, narrow it down to your requirements. Mention how much money you need.

For that, you will need to calculate your startup costs or the total costs of the activity for which you need funding.

Finally, justify your funding request by explaining how the investment will benefit your organization and contribute to its growth and success.

4. Discuss how you will use the money

Here, you have to narrow down what you need the money for and how you are going to use it. Just list down the details and put the figure for it—so much like how you do your billing. If you are taking the money for multiple things, highlight every detail.

Some examples of various areas where you might use the funding are:

• Product development
• Marketing and advertising
• Operational expenses
• Technological integration

5. Explain current and future financial planning

You must have explained a little about the inflow and outflow in the financial section of a business plan . But over here, you have to get into the details like:

• If you are getting a loan, outline your timelines for payments.
• If you are looking forward to selling, mention how it will affect the investors.
• And then, finally, mention the exit strategy. Your exit strategy includes how you will transfer the business ownership.

Key points to remember

As we now know what to include in the funding request, let’s see certain points that you need to keep in mind while writing it:

Target audience’s perspective . Applying for a loan is different from approaching an investor. Each of these situations involves different contract terms, types of funding, or amounts of money.

Clarity . Clearly explain with numbers how much funding is required, why you need it, and where you will use it. Also, keep your language for funding requests simple so that everyone can understand.

Realistic financial projections . Provide realistic financial projections so investors can feel confident about your business and trust you with an investment.

Call-to-action . Include a clear call-to-action that encourages investors to take the next steps, whether that’s scheduling a meeting or making an investment.

These may seem like simple tips, but they can help you write a strong funding request that gets investors interested in your business.

As a wrap-up, writing a compelling funding request requires a strategic approach and attention to detail. So, being carefully and include realistic projections.

If you are still confused about writing a funding request, you can leverage business planning software and make your business plan investment-ready.

Build your Business Plan Faster

with step-by-step Guidance & AI Assistance.

Frequently Asked Questions

Do i need a business plan to get funding.

Yes, a business plan is necessary for securing funding for a business. It allows investors and lenders to grasp the company’s vision and mission. A well-thought-out business plan increases your chances of securing funding.

How do I determine the amount of funding to request?

To determine the amount of funding, you will need to assess your organization’s startup costs, forecast cash flow, and consider growth plans.

Taking the help of an AI business plan generator or a financial advisor can help you determine a realistic funding amount based on your business’s needs and goals.

Do I need financial projections in my funding request?

Yes, including financial projections in a funding request is important. It provides potential investors or lenders with a clearer understanding of your finances. Usually, you should add a crux of your finances for at least three years.

About the Author

Upmetrics Team

Upmetrics is the #1 business planning software that helps entrepreneurs and business owners create investment-ready business plans using AI. We regularly share business planning insights on our blog. Check out the Upmetrics blog for such interesting reads. Read more

Reach Your Goals with Accurate Planning

How to Write a Funding Request

Fundrising Ready

MAC & PC Compatible

Immediate Download

Related Blogs

• How to Get Angel Investment for Your Business
• Invest in Accounting Software and Enjoy the Benefits
• Crafting an Effective Business Plan for Franchises
• Creating a budget that will help you achieve success
• Key Considerations for Starting a Business

Writing a funding request can be a pivotal step in securing the financial support your project needs. Understanding the key elements, such as a clear overview of your initiative, a detailed budget breakdown , and a compelling narrative, is essential to capture the attention of potential funders. With the right approach, you can effectively communicate your vision and demonstrate the impact of your work, increasing your chances of success.

What is a funding request and why is it important?

Definition of a funding request.

A funding request is a formal proposal that outlines the financial needs of a project or organization, seeking financial support from potential funders. It serves as a detailed document that explains the purpose of the funding, the intended use of the funds, and how the project aligns with the funder’s goals. The request can take various forms, such as a funding request letter, grant proposal, or funding proposal template, each tailored to meet specific requirements.

Purpose of a funding request in various contexts

The purpose of a funding request varies depending on the context in which it is presented. In nonprofit organizations, a funding request is often aimed at securing grants from foundations or government entities to support community initiatives. For startups, it may be a means to attract private investors to fund innovative projects. Regardless of the scenario, the funding request is crucial as it:

• Clearly articulates the project's vision and objectives.
• Demonstrates the potential impact of the project on the community or industry.
• Provides a transparent financial plan, showcasing how funds will be allocated effectively.

Importance of clarity and purpose to potential funders

Clarity and purpose are paramount in any funding request. Funders receive numerous proposals and are often pressed for time, making it essential for your request to stand out. A well-structured funding proposal will:

• Present a clear and compelling narrative that captures the funder's attention.
• Detail the specific financial needs and how they relate to the project's goals.
• Align the project’s objectives with the funder’s mission, showing a shared vision.

In this context, writing a funding proposal that is straightforward and free of jargon will enhance the likelihood of securing support. By ensuring that your funding request is both clear in its intentions and comprehensive in its details, you will significantly improve your chances of success.

• Always tailor your funding request to the specific interests and guidelines of the potential funder.
• Use a straightforward language that avoids jargon, making your proposal accessible to a broader audience.
• Highlight the unique aspects of your project that align with the funder's priorities and values.

Who is the target audience for your funding request?

Identifying potential funders.

When embarking on the journey of writing a funding request, the first step is to identify your potential funders. Funders can be categorized into several types:

• Foundations: These may include private, corporate, or community foundations that provide financial support for various initiatives.
• Government agencies: Local, state, and federal government entities often offer grants and funding opportunities for projects that align with their priorities.
• Private investors: Individuals or organizations looking to invest in innovative projects that demonstrate potential for return on investment.

Understanding who your funding sources are is crucial, as it sets the stage for crafting a tailored funding request that resonates with their specific goals and interests.

Understanding the interests and motivations of your audience

Each potential funder has unique interests that drive their funding decisions. To effectively engage them, you must delve into their motivations:

• Mission alignment: Ensure your project aligns with the funder's mission and vision. Research their previous funding initiatives to identify common themes.
• Impact focus: Many funders prioritize projects that demonstrate significant social, economic, or environmental impact. Articulate how your project meets these criteria.
• Return on investment: For private investors, outline how their investment will yield financial returns or other benefits.

By gaining insight into the interests of your funding audience, you can better position your project to meet their expectations and persuade them of its value.

Tailoring the request to meet the expectations of different funders

Once you have identified your target funders and understood their motivations, the next step is to tailor your funding request accordingly. This involves adapting your approach based on the type of funder:

• Grant applications: For foundations and government agencies, use a formal grant request format that includes clear objectives, a detailed budget breakdown, and measurable outcomes.
• Investor pitches: When approaching private investors, focus on the potential for financial returns. Use persuasive language and highlight the scalability of your project.
• Personalization: Always address funders by their name and reference their previous funding activities or interests to create a personal connection.
• Consider creating a funding proposal template that can be customized for different funders, saving time while ensuring relevance.
• Utilize insights from the funding application process to refine your request over time, learning what resonates with funders.

Tailoring your funding request not only demonstrates your commitment to the funder's goals but also increases the likelihood of securing the necessary project funding.

What key elements should be included in a funding request?

Overview of the project or initiative.

When crafting a funding request, it is crucial to begin with a comprehensive overview of the project or initiative . This section serves as the foundation for your funding proposal, providing potential funders with a clear understanding of what you are attempting to achieve. Your overview should encompass:

• A concise description of the project’s objectives and goals.
• The specific problem or need that the project addresses.
• The target audience or beneficiaries of the project.
• How the project aligns with the funder’s mission and interests.

By succinctly presenting this information, you can effectively engage funders and encourage them to delve deeper into your proposal.

Detailed budget breakdown and financial needs

The budget breakdown is one of the most critical components of your funding request. It provides a transparent view of your financial needs and demonstrates your project's viability. Here are key elements to include:

• A complete itemization of costs, including direct and indirect expenses.
• Justification for each budget item, explaining why it is necessary for the project’s success.
• Sources of funding already secured, if applicable, to showcase fiscal responsibility.
• Projected revenue streams, if relevant, to illustrate the project's sustainability.

Moreover, presenting your budget in a clear format enhances readability. Consider using a funding proposal template to maintain organization and clarity.

Timeline for project execution and milestones

Alongside the budget, a detailed timeline for project execution is essential. This timeline should outline the expected duration of the project and the key milestones that will be achieved along the way. Key components to consider include:

• The start and end date of the project.
• Specific milestones and deliverables, including their respective deadlines.
• Metrics for measuring progress and success at each stage.

This structured approach not only shows your planning capabilities but also reassures funders that you have a clear path to achieving your project goals. A well-defined timeline can significantly enhance your funding request, illustrating your commitment to effective project management.

• Ensure that your overview, budget, and timeline are interconnected. Each element should support and enhance the others for a cohesive funding request.
• Utilize visuals, such as charts and graphs, within your budget and timeline sections to make complex information more digestible.

How can you present your project effectively?

Crafting a compelling narrative to engage the reader.

When writing a funding request, it is essential to tell a story that captivates the reader. A compelling narrative helps funders understand not just what your project is about, but also why it matters. This emotional connection can significantly enhance the likelihood of securing the necessary funding. Consider the following elements when crafting your narrative:

• Start with a hook: Begin with a powerful statement or a personal anecdote that illustrates the problem your project aims to address.
• Define the problem: Clearly articulate the issue at hand, providing context and highlighting its urgency.
• Present your solution: Describe your project as a solution to the problem, outlining your objectives and the impact you anticipate.
• Include testimonials: If applicable, share quotes or stories from beneficiaries or stakeholders that reinforce the need for your project.
• Use vivid language and emotional appeals to create a connection with the reader, making your funding request more memorable.

Using data and evidence to support claims

While storytelling is vital, backing your narrative with solid data and evidence is equally important. This combination of qualitative and quantitative information adds credibility to your funding request. Here are some effective strategies to incorporate data:

• Statistics: Include relevant statistics that highlight the scope of the problem and the potential impact of your solution.
• Research findings: Reference studies or reports that support your project’s approach, demonstrating that it is grounded in proven methodologies.
• Case studies: Provide examples of similar projects that have successfully achieved their goals, showcasing the effectiveness of your proposed solution.
• Visual aids: Utilize charts, graphs, and infographics to present data in an easily digestible format, enhancing the overall appeal of your funding proposal.
• Ensure that your data is up-to-date and relevant, as outdated information can undermine your credibility.

Highlighting the impact and benefits of the project

In your funding request, it is crucial to not only outline what your project will do but also to emphasize its potential impact and benefits. Funders are often interested in how their investment will create positive change. To effectively highlight these aspects:

• Define success: Clearly articulate what success looks like for your project. Use measurable outcomes to illustrate how you will assess impact.
• Broader benefits: Discuss how your project will benefit not only the immediate target group but also the wider community or sector.
• Long-term vision: Share your long-term goals and how the project aligns with broader trends or needs, demonstrating foresight and sustainability.
• Engage funders: Make it clear how their support will play a crucial role in bringing about this change, fostering a sense of partnership.
• Consider using a dedicated section in your funding proposal to highlight impact, making it easy for reviewers to find this crucial information.

What common mistakes should be avoided in a funding request?

Overcomplicating the language or using jargon.

One of the most significant pitfalls in writing a funding request is the tendency to overcomplicate the language. Funders are often busy individuals who may not have the time or inclination to decipher convoluted terms or technical jargon. Using clear and concise language is essential to ensure your message is understood.

To avoid this mistake, focus on articulating your ideas in plain language. This will not only make your funding request more accessible but also help engage the reader more effectively.

• Use simple language and direct sentences to convey your message effectively.
• Define any necessary technical terms in straightforward terms.

Failing to follow the funder's guidelines and requirements

Each funding source typically has its own set of guidelines and requirements for proposals. Ignoring these can lead to automatic disqualification of your funding request. It is crucial to meticulously review the funding guidelines provided by the potential funder and tailor your proposal accordingly.

Make sure to adhere to specifics such as:

• Formatting requirements (grant request format).
• Page limits and font sizes.
• Required documentation and supplementary materials.

Following these instructions demonstrates your attention to detail and respect for the funder's process, increasing the chance of your project funding request being favorably considered.

• Create a checklist based on the funder's requirements to ensure you meet every guideline.
• Double-check your proposal against the guidelines before submission to avoid any oversights.

Lack of clarity or specificity in financial needs

Another common mistake in funding requests is a lack of clarity regarding financial needs. Funders want to know precisely how much funding you are requesting and how you plan to allocate these funds. Vague statements about needing 'some money for the project' do not instill confidence in your ability to manage funds effectively.

To strengthen your proposal, include a detailed budget breakdown that outlines:

• Specific amounts required for each aspect of the project.
• Justifications for each expense, linking them directly to project goals.
• A timeline for when the funds will be needed.

Providing a comprehensive financial needs assessment not only clarifies your request but also demonstrates your capability in planning and executing the proposed project.

• Utilize a funding proposal template to ensure all financial aspects are covered.
• Be transparent about potential risks and how you plan to mitigate them, enhancing funder confidence.

How can you strengthen your funding request with additional materials?

Importance of including a cover letter.

A well-crafted cover letter is a critical component of your funding request. It serves as the first impression you make on potential funders and can set the tone for the entire proposal. The cover letter should succinctly summarize your project, outline your funding needs, and express your enthusiasm for the opportunity to partner with the funder. It’s essential to personalize the cover letter by addressing it to the specific individual or organization to whom you are submitting the funding request.

• Keep the cover letter concise—ideally one page.
• Highlight the most compelling aspects of your project.
• Make a direct connection between your project and the funder’s goals or interests.

Providing Supplementary Documents

Supplementary documents can greatly enhance your funding request by providing additional context and credibility. These documents may include:

• Resumes of key team members: Highlight the qualifications and relevant experience of your project team to demonstrate their capability to execute the project successfully.
• Letters of support: Obtain endorsements from reputable individuals or organizations that can vouch for your project's significance and your team's competence.
• Data and research findings: Include relevant studies or statistics that support your project’s need and potential impact.
• Always check the funder’s guidelines for specific requirements regarding supplementary documents.

Utilizing Visuals to Enhance Understanding

Visual elements can significantly strengthen your funding request by making complex information more accessible and engaging. Charts, graphs, and infographics can effectively illustrate your project’s objectives, budget breakdown, and anticipated outcomes. Consider the following tips for incorporating visuals:

• Choose visuals wisely: Select visuals that clearly convey key data or concepts relevant to your funding proposal.
• Maintain clarity: Ensure that all visuals are easy to read and understand, with appropriate labels and legends.
• Integrate visuals seamlessly: Place visuals strategically within your funding request to complement the narrative rather than distract from it.
• Use high-quality images and graphics to maintain a professional appearance.

What follow-up actions are necessary after submitting a funding request?

Establishing timelines for follow-up communication.

After submitting your funding request, it is crucial to establish a clear timeline for follow-up communication. This helps you stay organized and demonstrates professionalism to potential funders. Here are some key steps to consider:

• Review the funder's guidelines for any specified response times.
• Set a reminder to follow up approximately two to four weeks after submission.
• Be prepared to adjust your timeline based on the complexity and size of the funding source.

Preparing for potential questions or requests for additional information

Once your funding request is submitted, you may receive inquiries from funders seeking clarification or additional information. Being well-prepared can significantly enhance your chances of success. Here are some tips:

• Anticipate common questions that funders may have, such as those related to your budget or project timeline.
• Have supplementary documents, such as a financial needs assessment or resumes of key project personnel, readily available.
• Respond promptly and thoroughly to any requests for additional information to maintain the funder's interest.

Maintaining a relationship with funders regardless of the outcome

Regardless of whether your funding request is approved or denied, it is essential to maintain a positive relationship with potential funders. This can open doors for future opportunities and collaborations. Consider the following strategies:

• Send a thank-you note expressing appreciation for their time and consideration, even if your request was not successful.
• Ask for feedback on your funding request to improve future proposals.
• Keep funders updated on your project's progress and any achievements, fostering a long-term relationship.
• Be proactive in your follow-up communications and show genuine interest in the funder's feedback.

In summary, effective follow-up actions after submitting a funding request can significantly influence the outcome of your proposal. Establishing clear timelines, preparing for inquiries, and nurturing relationships with funders are all vital components of the funding application process. By implementing these strategies, you can enhance your chances of success in future funding endeavors.

• Choosing a selection results in a full page refresh.

Business Plan Section 8: Funding Request

These guidelines will help you prepare a funding request to present to a potential lender alongside your loan application.

We’ve talked before about the benefits of having a business plan for every business, but the truth is, most companies don’t put one together until they want to apply for funding, whether from a bank or investor. Sometimes, even if you don’t need a full business plan when applying for a loan, you will be asked for a funding request. You can also follow the guidelines below to prepare a stand-alone proposal to present to a potential lender with your application.

If the purpose of your business plan is NOT to get funding, feel free to skip this section.

As we’ve said before about writing a business plan, it’s important to keep your audience in mind. You can certainly prepare different versions of your funding request depending on whether you’re applying for a loan or approaching an investor. The terms of each would be different, and you might be looking for different amounts of money or types of funding, especially if you’re approaching several potential partners.

Be clear about whom you’re directing the request to, and think about the questions they might have and what they would want to see. Make sure you’ve done your homework regarding the costs involved with your plans. This is where the financial section of your plan will work hand in hand with this one. Be consistent with your numbers, and ask for enough to cover your needs fully so you don’t fall short and remain unable to complete your goals. At the same time, don’t ask for more than you need.

What to Include in Your Funding Request

1. a summary of the business.

If the request is part of your business plan, you will have already put together all the information found in a business summary. If you’re creating a funding request as a stand-alone document, explain what the company is, where you’re located, what you sell or what services you offer, and who your customers are. Mention whether you’re incorporated, and if so, what type of corporation it is, along with who the owners and key staff members are. Briefly list your business successes and accomplishment thus far.

2. How much money you’re requesting

How much cash are you looking for now, and if you anticipate this being the first part of an ongoing growth plan, how much more money do you plan to request over time? What would the specific timeline look like? The Small Business Administration suggests thinking as far as five years down the road when putting your funding request together. Also spell out what type of funding you’re looking for, whether a loan or investment, and the terms you’re asking for. (As we suggested above, you can put together different versions of the request for different types of funding.)

3. What you will use the money for

Do you need some extra funds for working capital to buy more inventory? Are you paying off a high-interest loan? Buying a building, new equipment, or another company? Expanding your advertising campaign, or hiring more staff? Whatever it is, explain how much each aspect will cost.

4. Financial information

This will be the heart of the financial information section of your business plan , but you need to include it here if you’re putting together a stand-alone funding request.

You’ll need historical data on the company (if it’s an established business), like income statements, balance sheets, and cash flow statements for the last three to five years. If the funding request is for a loan that requires collateral, document what you have to offer. If you’ve invested your own money in the company or there are other investors, state that along with how much.

Offer realistic projections for the future, and explain how this new funding would help you reach those goals. Prepare yearly forecasts for income, balance sheets, cash flow and capital expenditure budgets for the next five years. Be even more specific for the first year, with projections for each month or quarter.

You also need to cover how you plan to pay off the debt, or what kind of return on investment you can offer a potential investor. Potential funders will pay particular attention to this, wanting to maximize their gains and minimize their risk as much as possible. If the plan is targeted to investors, what would their exit plan be? Can they cash out in a specific number of years? Do you plan to go public and offer stock?

Finally, address anything that might affect your ability to repay, whether positively or negatively, such as being acquired, buying out another business, relocating, etc.

Getting money to fund your business may very well be the point of creating your entire business plan, so take the time to carefully prepare your funding request, making sure to include all the information a decision-maker will need.

NEXT ARTICLE > BUSINESS PLAN SECTION 9: APPENDIX

Apply for a loan, get started.

Loans from $5,000 - $100,000 with transparent terms and no prepayment penalty. Tell us a little about yourself, your business and receive your quote in minutes without impacting your credit score.

Thanks for applying!

Loans are originated and funded through our lending arm, Accion Opportunity Fund Community Development. By clicking “Continue to Application,” you consent to, Accion Opportunity Fund Community Development’s Terms of Use and Privacy Policy ; and to receive emails, calls and texts , potentially for marketing purposes, including autodialed or pre-recorded calls. You may opt out of receiving certain communications as provided in our Privacy Policy .

Business Plan Funding Request Section: How to Write Guide .

Sep 17, 2023 | Business Consulting , Business Growth , Business Performance , Business Plan , Financial Plan , Funding Needs , Funding Request , Small Business , Startup , Strategy

How to Write the Business Plan Funding Request

“It is more rewarding to watch money change the world than to watch it accumulate.” –Gloria Steinem.

By now, you’ve made significant progress in developing your business plan. With this, the eighth article in our Creating a Detailed Business Plan series will focus on including a funding request.

Business plans are generally the catalyst for requesting banks, lenders, and investors to invest money into a company . Usually, the business plan and funding help support business growth or rapidly scale a startup company.

As you can imagine, this makes the funding request section extremely important . Business plans can be written even with ample existing funding and can be in stages to support different business expansion phases. You can omit a funding request if you aren’t looking for outside investment.

The funding request section of your business plan is required if you plan to seek funding from a lender or investors.

Benefits of including a business plan funding request section

A business plan typically consists of various areas, and if you intend to secure funding for your business, it’s crucial to include the funding request section. Fortunately, this part of your business plan is only necessary if you plan to seek external financial assistance. If you don’t require any funding, you can skip this section.

There are various ways to fund your business without debt or investors. This article will help you create a persuasive funding request for your business plan.

What information is needed for the business plan funding request?

The business plan funding request section of your plan outlines your financial needs for the future, including how much money you require and when you will need it. You should also mention the various sources you could use to secure funding, such as loans or crowdfunding.

Remember that you can constantly update this section in the future if you require additional funding for business expansion.

How much money and how much duration must you include in your funding request?

A funding request is no time to be shy. Your readers will know what funding you’re after when they get to this section, so be forthright. Declare your business funding needs now and in the future. Give exact figures, and spell out any further infusions you’ll require over the next five years.

Explain how long the funds will be needed , when you plan on repayments, and when the investor can expect a return. It’s also helpful to spell out whether you’d prefer a loan, a grant, a direct investment, and any other relevant terms you would like included . For example, are you willing to give up equity in your business to secure the loan, or will you be personally underwriting the loan from your assets?

How do you plan to use the requested funds?

It’s unlikely that anyone will give you money if they don’t understand how you plan on using the funds. So be explicit when explaining the purpose of your request. For example, note whether the funding will go toward working capital, additional equipment, or business expansion to new premises or regions.

Describe your plans if you are growing your team or expanding your operation. If you plan on buying another company, explain what this will do for your bottom line and cash flow.

You might also use the funds to retire debt, create and market a new product line, or combine things. Whatever the use, be rigorous in your explanations.

Business banks and investors aim to secure a reasonable return on their investment. So, they’re far more likely to fund businesses that plan to use the money to grow and become more profitable.

But, on the other hand, if they get the sense that the money is just helping to string along a failing enterprise or the owner is not clear on the funding required, they’ll stay away.

What are your long-term plans for the business?

If you have any solid, situational plans for the business that might positively impact investors, you should spell them out.

Consider your plans for scaling your business. If there’s an expectation of a lucrative buyout or acquisition after meeting specific benchmarks, mention this. Describe your goals if you plan on selling a portion of the company to focus your efforts on more profitable areas.

Mention any primary debt service you plan to make, mainly if it will put your company on a firmer footing for the future.

Why should investors trust you?

This question is critical. It would help convince your readers that you would be a good steward of their money and your business. It’s essential to remember that those who are providing you with money are doing so with the expectation of being paid back and making a profit. If they don’t trust you or doubt your ability to make this happen, they may not be willing to get involved.

Explain the assumptions you’re making in your plans and provide the proper financials to support your contentions. Let the data speak. If you’re correct, the research will bear out our position.

Planning for your finances now and in the future

When it comes to financial planning and funding your growth , it’s essential to consider factors such as loan repayment schedules and potential business sales. If you are seeking a loan, it’s wise to detail your repayment plans, although lenders will likely have their agenda in place. If you plan to sell your business, it’s crucial to inform the lender and explain how this may impact them. Additionally, you should consider possible relocation if you plan to move or a buyout if that’s on the table. Lastly, informing investors of their exit options, such as the ability to cash out and the timeline for doing so, is essential.

Our upcoming article will focus on creating financial projections for a business plan.

You can achieve your goals, and Noirwolf is here to assist you.

Putting together a funding request can be daunting. Asking your accountant for help is always a good idea. You can also use tools like Microsoft Excel and financial planning software like LivePlan . If you need further assistance, we’re ready to help out.

Contact us today to learn more about Noirwolf Consulting services and how we can significantly help you .

Get in Touch

Are you looking to grow your business but unsure where to start? Our small business consulting and leadership coaching services are here to help! We’ll work with you to scale your operations and achieve your goals. Plus, we offer a free 30-minute consultation to ensure we fit your needs correctly. Let’s get started!

Contact Noirwolf Consulting today using the website contact form or by emailing [email protected] or call us at +44 113 328 0868.

Recent posts .

Project Portfolio Management (PPM)

Jun 30, 2024

Project portfolio management (PPM) is a systematic process by project managers and project management organizations (PMOs) to evaluate the potential advantages of initiating a project. In this process, project managers play a crucial role in providing companies with predictive and business analyses for potential project investments. They do this by collating and structuring all pertinent information about proposed and ongoing projects, and by facilitating communication between team members and stakeholders.

Project portfolio management (PPM) empowers organizations and managers by providing comprehensive insights. This wealth of information allows executives to discern which project managers to engage with, and enables project managers to easily access team members. It facilitates improved communication with leadership and colleagues for team members, and ensures that stakeholders are continually informed with reliable and consistent feedback, making everyone feel informed and knowledgeable.

Setting Up a PMO (Project Management Office)

May 25, 2024

Project management plays a crucial role in every business, and establishing a project management office is essential for maintaining consistency and achieving successful results. Many companies create a project management office (PMO) to ensure that projects are finished on time and within budget. But what exactly does this involve? This article will furnish you with all the essential information for setting up a PMO, covering everything from the fundamentals of a PMO to selecting the appropriate tools and procedures for your business.

What is Program Management?

Apr 2, 2024

Program management is a vital component of organizational success, as it enables the coordinated execution of interdependent projects that yield benefits beyond the scope of individual project management. It involves the judicious application of knowledge, skills, tools, and techniques to meet specific program requirements. Our experience has demonstrated that organizations with well-developed program management and program management offices (PMOs) consistently outperform those that lack such structures. Therefore, it is imperative that organizations prioritize the establishment of robust program management frameworks to achieve their strategic objectives.

Happy clients .

Trevor mcomber, us.

I recently worked with Zoe@Noirwolf, who provided me with an outstanding 5-year business plan. The expertise in financial planning, market research, SWOT analysis, and consulting was exceptional. Zoe provided me with a comprehensive and well-researched plan tailored to my business. The entire process was professional, timely, and communicative.

Bill Walton, Leeds

Zoe provided first-rate work and is an excellent business consultant. I was trying to figure out my cash flow forecast for my startup. Zoe gave me an interactive consultation session over MS teams, which was valuable and saved me a lot of time. She is super quick in excel and knowledgeable about what to include in your estimates. She was able to offer me ideas & choices that I hadn't considered. Highly recommended.

Jeendanie Lorthe, US

Warren kim, us, oscar sinclair, london, get in touch ..

Looking to grow your business but feeling unsure about where to start? Our small business consulting and leadership coaching services are here to help! We'll work with you to scale your operations and achieve your goals. Plus, we offer a free one-hour consultation to ensure we fit your needs correctly. Let's get started!

• Write for Us
• Personal Finance
• Productivity
• Prospecting

Blog » Business » How to Write the Funding Request Section of Your Business Plan

How to Write the Funding Request Section of Your Business Plan

So you’ve got that idea and you’re ready to launch your business . You started to prepare your business plan, but… Not every business plan will need a funding request section. If you’re looking for outside funding though, you’re going to need to ensure this section goes in. You’ll need it whether you’re going to apply for a loan for your business or approach an investor . Here’s how to write your funding request and get the cash you need.

Write an Outline of Your Business

This may sound as though it would be rather pointless, as your entire business plan will be outlining your business. However, you’ll need to outline your business as this section may be used separately from the rest of your plan.

Create an outline that focuses on giving your readers the main points of your business plan. In short, you’re going to want to summarise what your business does and how it plans to operate. This should be enough for your reader to move forward but won’t be repeating anything if they do happen to have the entire document to hand.

Spell Out What You Need in the Funding Request

When it comes to the funding section of your business plan, there’s no point beating around the bush because the reader is going to know exactly what you’re there for and may not have the time to play games trying to figure out what you’re asking for.

Nor are they going to bother to call or email you asking what you meant. Your funding request will simply be denied.

You’ll need to ask for the amount of money you need straight, but that won’t be everything you include in this funding request. Here’s a full list of what you’ll need to include:

• Amount needed: Ask for the full amount you’ll need. Will you use this cash in one lump sum, or will you need further investments over time? Consider this when thinking of how much you need to ask for.
• Loan or investment: How do you want this money? Both a loan and investment have benefits and downfalls, so make sure you’re researching each possibility to see what works best for your business.
• The terms you’re asking for: These will need to be agreed upon before you put this funding request forward and will be a defining factor in your contract, so you’ll want to make sure that you’re investing a good amount of time in ensuring these terms and conditions work well and in favour of your business.

Let's be inbox friends!

Drop us your email to receive a weekly digest of our latest blog posts right in your inbox. We share knowledge on billing, invoicing, and how to succeed in your business.

Our newsletter comes out each Tuesday, it's spam-free and you can unsubscribe anytime with a click.

Please check your inbox to confirm your subscription!

How you will use the funds.

If you know how much money you need, then it’s safe to say that you’ll have an idea of what it’s going to be used for.

However, make sure that you’re only outlining what your funding is going to be used for. If you’re going to be using it for several different reasons, perhaps dividing it into several areas of your business, such as product development, marketing, and staff costs, make sure that you take the time to outline each use and explain how much will go towards it.

Always remember that the vast majority of investors and lenders would give their money to help a business grow. Rather than trying to help you scrape through on a failing business idea in which they’ll see very little, potentially no, return on investment.

That means you’ll find they’re more likely to fund staff or equipment, rather than help you pay down debt.

Use Tools to Help You Write the Request

The more professionally and comprehensively you’ve written your business funding request, the more likely it is to be fulfilled by your potential investors. This means you’ll need to check your proposal before sending it to ensure that it’s free from errors and mistakes that could seriously damage the credibility and reputation of your business.

Here are some tools that will help you get it written to the highest quality possible:

• State Of Writing and My Writing Way : These writing guides are full of good advice.
• Assignment Help : This service can edit and proofread your request.
• Via Writing and Grammar Check : Get help with your grammar here to ensure a professional standard in your funding request, and your entire business plan.
• Boom Essays & Academized : Writing agencies recommended by the Huffington Post that will help you with editing and proofreading.
• Cite It In : Cite any sources you use correctly and professionally using this free online tool.
• Essayroo and Big Assignments : These writing agencies can help you put your requests together.
• Easy Word Count : Keep your writing concise with this tool by monitoring its word count to ensure you don’t bore your reader.

Include Financial Information

If someone is to invest in your business, they’ll need to have all the information at hand before they make a decision. You need to be including your business’ financial information in this document, to show them how you handle the income you get. You’ll need to include income statements. Such as cash flow statements, balance sheets, and any other information that may be relevant.

If you’re taking a loan, you’ll need to think about how you’re going to pay the money back, and when. If it’s an investment, what can you offer the investor to show them you’re worth investing in?

Read Your Request Over Before Submitting It

“Finally, you’ll need to proofread and edit your request before you send it out. It’s an essential part of the writing process. No matter how careful you were, you can still make errors in your writing,” says Jenna Gallivan, writer at Elite Assignment Help . Give yourself enough time to sit and read your request through carefully. Give it several passes, to ensure you catch everything. The more you edit, the more professional your request will be.

These tips will help you write finance requests that are reasonable, thorough, and help you get the cash your business needs. Follow this advice and you’ll be able to get the help you need easily. Write it well and you’ll be on your feet in no time.

• Latest Posts

Mary Walton

Latest posts by mary walton ( see all ).

• How to Write the Funding Request Section of Your Business Plan - May 2, 2018

• Search for:

A little something about you, the author. Nothing lengthy, just an overview.

• Expert Profile
• Experts & Contributors
• Invoicebus Blog
• Register New Author
• Sorry to see you go…
• Write for Us: Guest Blogging Guidelines
• You’ve subscribed!
• October 2023
• January 2023
• November 2022
• October 2022
• September 2022
• January 2022
• February 2021
• December 2020
• November 2020
• September 2020
• August 2020
• February 2020
• January 2020
• December 2019
• November 2019
• October 2019
• September 2019
• August 2019
• February 2019
• January 2019
• December 2018
• November 2018
• October 2018
• September 2018
• August 2018
• February 2018
• January 2018
• December 2017
• November 2017
• October 2017
• September 2017
• August 2017
• Accounting (17)
• Billing (16)
• Business (125)
• Invoicing (28)
• Marketing (65)
• Personal Finance (6)
• Productivity (29)
• Prospecting (12)
• Taxation (10)
• Valid XHTML
• Terms Of Service
• Privacy Policy
• Refund Policy
• How to Create HTML Template
• PDF Invoice Generator
• Invoice Templates
• Invoicing Guides
• Experts & Contributors

Drop us your email to receive a weekly digest of our latest blog posts right in your inbox.

To confirm your subscription, please check your email.

Financial Funding Proposal Template

Used 6,242 times

Reviewed by Denis Malkov

e-Sign with PandaDoc

Financial Funding Proposal Template

Prepared by: ​ [Sender.FirstName] [Sender.LastName] ​ ​ [Sender.Company] ​

Prepared for: ​ [Client.FirstName] [Client.LastName] ​ [Client.Company] ​

[Sender.Company] is on a mission to build the greatest product possible in the (industry) space, and do so while causing no additional harm to the environment. Our aim is to become a business that inspires and executes solutions for environmental problems while creating products that impact the lives of our users. We want to define the future of ecology by providing tremendous value and opportunity to our clients, workers, shareholders, and the planet through our initiative.

MISSION STATEMENT

We collaborate on design and development, staying focused on delivering results for the people we are passionate about. Our mission is to (insert mission and vision of your company.)

We believe in (something your business executes) to benefit (potential clients) by (what you've been doing) to (greatest importance of the product you deliver) .

SERVICE POPULATION

​ [Sender.Company] will be servicing the population within the parameters of (Sender.Region or Sender.Demographic) . Our company believes in equal opportunities and the right to fundamental services for people from all cultural backgrounds, religious backgrounds, races, gender, age group ranges and income. Our work has impacted people across diverse populations and our impact can be seen in the statistical data below: (insert data of the people you’ve managed to impact).

At [Sender.Company] , our aim is to continue prospering, to lead toward success and generate value for our partners. We seek to construct a more sustainable model for retailers and strengthen communities by placing progressive change at the center of our company. Our impact evaluation approach goes beyond greenwashing. We assess ourselves by analyzing how our business positively affects the general public, our workers, consumers, and the environment.

OVERVIEW OF CURRENT PROGRAMS

Grant history, amount required.

FINANCIAL PROJECTIONS

Statement of need, evaluation, funding management and planning, board of directors.

Meet the Board of Directors that sit at the helm of [Sender.Company] ’s internal control system and its performance. They do so in addition to establishing and adhering to standards and criteria that enable the executive administration to fulfill the company's objectives

(Name), as the Head of (insert department name), is an essential part of the Board of Directors, and is responsible for establishing and overseeing the group's corporate strategy and goals, as well as adopting greater policies and overseeing administration.

As the Head of (insert department name) , (Name) ensures that the group controls associated risks by establishing and evaluating [Sender.Company] ’s investment strategies, as well as detecting and defending against long-term risk to the firm.

(Name) , being the Head of (insert department name) , is accountable to the shareholders for the [Sender.Company] 's financial and operating performance. (Name) is in charge of generating and allocating funds, supervising the Executive Management Team and its operations, making crucial business decisions, and creating long-term shareholder value.

Our budget proposal explains the planned expenses for our future project. These values are estimates that are based on our in-depth analysis of future financial requirements as well as our profit generation.

LIST OF EXPENSES AND COSTS FOR FUNDING PROPOSAL

​At [Sender.Company] , we are looking for funding for the aforementioned project in order to accomplish the stipulated aims. We invite you to join us as a funding source for this project.

LETTER OF APPROVAL

​ [Sender.FirstName] [Sender.LastName]

​ [Sender.Company]

​ [Client.FirstName] [Client.LastName]

​ [Client.Company]

CONFIDENTIALITY AGREEMENT

The administering agent and all granting or lending institutions listed herein undertake to keep the Information in this proposal secret, other than that which is agreed upon by all parties as permitted to be shared with the boards, officers, personnel, and representatives of the administrative entity and its subsidiaries, comprising auditors, legal representation, and other advisers. Each Investor undertakes that any personal information obtained from the company according to the provisions of this agreement will be kept secret and will not be disclosed, divulged, or used for any cause.

Care to rate this template?

Your rating will help others.

Thanks for your rate!

Useful resources

• Featured Templates
• Sales Proposals
• NDA Agreements
• Operating Agreements
• Service Agreements
• Sales Documents
• Marketing Proposals
• Rental and Lease Agreements
• Quote Templates
• Business Proposals
• Agreement Templates
• Purchase Agreements
• Contract Templates

How to Write a Business Plan: Funding Request

There are several reasons to write a business plan.  A common reason is to help small business owners gain a better perspective of their business.  However, small business owners often seek out a business plan for the sole purpose of obtaining funds from a bank or investor.  If this is your purpose, then you definitely need a business plan funding request in your document.  Further, to optimize your chances of obtaining funding, some specific steps and strategies should be followed for writing your funding requests.

Need Help Writing a Funding Request for a Business Plan?

Call or Text Paul, Doctoral Candidate, MBA.

321-948-9588

Email: [email protected]

Our business plan writer is located in Orlando, Fl.

Need help with your funding request section of a business plan?  Quality Business Plan offers two popular services for funding request section help, which are business plan templates or professionally prepared business plans.

Business Plan Template

If you prefer to do your funding request on your own, at the very least, use a customizable business plan template. Check out our business plan templates by clicking on the link below.

Professionally Written Business Plan

If you want your funding request done by a professional, then our business plan writing service is for you! Check out our business plan prices by clicking on the link below.

Make your funding request is the last section of your business plan .

Your business plan will include a plethora of information about your business, such as the target market, company information, financials, and products or services sold.  Before requesting funding, make sure to educate the potential investor about your company in its totality.  Because of this need, the funding section should be the last piece of information the reader reviews.  This will help the investor or lender come to an educated decision based on all the information available about our company or proposed company.

Why the funding is needed.

The first portion of your funding request should be focused on explaining why the funds are needed.  For some companies, funds are only required for working capital, which is monies used to fund operations.  For other firms, funding is necessary to start operations.  Regardless of the reason why you need the funds, make sure to explain, in detail, why funds are needed.

The total amount of funding needed.

The second piece of information that should be included in your business funding request is the total amount of funds needed.  This should immediately follow why funding is necessary section.  For this part, make sure to state the required funds in one lump sum.  This prepares an investor or reader for the total dollar amount needed.

Usage of funds.

In this section, make sure to break down where the funds will be spent and when the funds will be needed.  For example, if funds are required for working capital, then make sure to say that funds will not be needed until the business opens its doors and then break down in various components how the funds will be spent, if possible.

Parameters of funding.

After the breakdown of how funds will be used, discuss parameters for accepting funding.  These parameters may include an equity stake in the company or specific loan guidelines.  An example of this would be: “Our firm will offer a 25% equity stake for interested investors”. Once this is stated, make sure to explain how funds will be repaid.

How funds will be repaid.

In this portion, investors will want to know how they are going to get paid for their investment.  A popular method of repayment is through dividend payments.  The structure may vary depending on the situation.  From this, in my personal experience, it's a good idea to include some type of statement that the terms may be negotiable.  This allows the investors to make counteroffers about your set parameters.

Possible future funding needs.

Once an investor takes an equity position in the company, they are not fond of surprises.  A most unwelcoming surprise for an investor is for them to find out after they invest, that additional debt may be needed, or further equity investments are required.  Avoid this unpleasant conversation upfront.  Make sure to provide an outline as to possible situations where additional funding may be necessitated.  In doing this, investors are prepared for either a dilution of their equity stake or understanding that additional funds may be required in certain circumstances.

Summarize funding request and include in the executive summary.

The final step to fully utilizing your funding request is to summarize the section into three or four sentences and insert them in your executive summary.  By doing this, investors will know right from the beginning how much funds are being requested and possible terms offered by the company.

Example of a funding request.

Starting a retail bicycle store requires significant upfront funds and working capital to ensure brand building and adequate market penetration.  From this, our firm is requesting $50,000.  Funding will be used as follows:

• Construction Costs
• Storefront design
• Computers and software
• 30 Men bikes
• 25 Women bikes
• 30 Kid bikes
• Safety gear
• Accessories
• Working Capital 25,000

"Bikes and Accessories" will offer potential investors a 15% equity stake in our firm.  Funds will be repaid monthly through dividends based on net profits.  In the event, our firm identifies future opportunities in the marketplace; additional funding may be sought via equity or debt financing.

By: Paul Borosky, MBA., Doctoral Candidate.

Owner of Quality Business Plan.

Updated: 3/4/2022

More From Forbes

5 tips for writing a funding request lenders and investors will love.

• Share to Facebook
• Share to Twitter
• Share to Linkedin

Writing a great funding request is crucial when seeking money for your business. Follow these five ... [+] tips to write a request investors will love.

Startups, long-established businesses, and any business in between may need an influx of cash at some point. Getting funding from lenders or investors is one way businesses can get the funds they need. But, how you write a business funding request can make the difference between a yes or a no response. There are five key tips for writing a business funding request—and I’m here to break them down for you. 

5 Key Tips To A Funding Request

One of the many things I’ve learned through my years as a serial entrepreneur is that getting funding can be necessary. Even when you put your all into your business, getting some cash flow from a lender or investor helps you go a little further. With that in mind, let’s get into my five tips for how to write a funding request that lenders and investors will love (so your business can benefit!). 

1. Be Professional

Being professional should go without saying, but it is of the utmost importance when communicating with lenders or investors. And, being professional is not just in appearance or word choice. It can also include small details, like tone or grammar.

For email, online data submissions, paper communication, or other documents, check the following before sending:

• Punctuation
• Clarity of the document
• Active voice
• Conciseness

If you plan to mail your funding request, make sure you complete everything digitally instead of by hand. Typed forms are more professional and generally more legible for others to review. Do you have any letterhead for your business? If so, use it for any cover letters you submit with the request. 

Best Travel Insurance Companies

Best covid-19 travel insurance plans.

Do you plan to submit everything online? Review for any errors before submitting. Consider using word or grammar correction software to help catch any potential mistakes. 

2. Do Your Research

From loans through the Small Business Administration (SBA) to funds from angel investors , there are many options to consider when seeking funding. Rather than create one template for all investors, research what each option has available and tailor your requests. The last thing you want to do is write up a one-size-fits-all funding request. 

Instead, sit down and look through what each option has to offer. It may take some time, but research lets you narrow down your best opportunities. For example, if your business sells novelty T-shirts, you don’t want to submit a request for funding to an investor who works with technology and software. 

Researching potential lenders also allows you to determine if there is a funding limit. If you need $200,000, but a lender only provides up to $100,000, your research lets you know you need to limit your request. Or, you can look for another lender or investor for the remaining funds you need. 

Keep in mind that some lenders (e.g., SBA) have business size requirements. Looking into a potential lender or investor lets you determine if your business funding request is a good fit before you sit down to write. 

3. Bring Documents

Let’s face it: Before anyone lends or invests large sums into your business, they need to get nosy with your financials. Prepare all of your financial documentation before contacting lenders or investors to put your best foot forward. 

Prepare the following business financial statements:

• Income statement
• Cash flow statement
• Balance sheet
• Statement of retained earnings

Investors and lenders may also want to see other important information, including:

• Personal financial statements
• Business licenses and permits
• Ownership and/or affiliate documentation
• Business loan or mortgage information
• Loan application history

Some investors may require different information. And, some lenders may require more or less documentation from you. Be prepared to provide any and all up-to-date financial records you may have. 

4. Give Details

A funding request is not an elevator pitch . So, it’s important to provide as much detail as possible without adding unnecessary filler. 

Add the following information to the funding request:

• Business information (e.g., location, date opened, products or services, etc.)
• Current financial situation
• Amount of funding requested
• How you plan to use the requested funds
• Explanation of current and future financial plans (e.g., how you plan to pay off loans)

Explain why you need the amount you’re requesting and how you will use the funds. Give lenders or investors details on how you will use the funds to grow your business and repay the loan or make good on the investment. 

5. Be Realistic

In an ideal world, your million-dollar idea would guarantee a $1 million investment or loan. Unfortunately, that’s not exactly how the real world works. So, it’s crucial that you set realistic expectations for your business’s needs. 

Grab a calculator, pen, and notebook. Sit down with your financial statements and determine a realistic funding request. 

If you’re looking at business loans, factor in the length of a potential loan repayment period. Can you afford to repay a loan of $100,000? What about $50,000? What interest rate is too high for you to consider? Consider how loan repayments will impact your monthly business bills. 

Looking at investors? Before you take the plunge, ask yourself the maximum percentage of ownership or control you’re willing to give to an investor. If an investor agrees to the maximum funding request but wants a 50% control, are you willing to accept that offer? 

If you’re not sure about the answers to these questions, consult your accountant or a business lawyer for guidance. 

Writing A Funding Request Wins And Losses

Not every funding request is a win, and that’s OK. Sometimes, you decide the loan or the investment isn’t the right fit for your business. Other times, it’s just not the right request at the right time with the right lender or investor. Don’t give up after one loss or even a dozen. Keep trying and remember these five tips before starting your next funding request.

• Editorial Standards
• Reprints & Permissions

• Sources of Business Finance
• Small Business Loans
• Small Business Grants
• Crowdfunding Sites
• How to Get a Business Loan
• Small Business Insurance Providers
• Best Factoring Companies
• Types of Bank Accounts
• Best Banks for Small Business
• Best Business Bank Accounts
• Open a Business Bank Account
• Bank Accounts for Small Businesses
• Free Business Checking Accounts
• Best Business Credit Cards
• Get a Business Credit Card
• Business Credit Cards for Bad Credit
• Build Business Credit Fast
• Business Loan Eligibility Criteria
• Small-Business Bookkeeping Basics
• How to Set Financial Goals
• Business Loan Calculators
• How to Calculate ROI
• Calculate Net Income
• Calculate Working Capital
• Calculate Operating Income
• Calculate Net Present Value (NPV)
• Calculate Payroll Tax

How to Write a Business Plan in 9 Steps (+ Template and Examples)

Every successful business has one thing in common, a good and well-executed business plan. A business plan is more than a document, it is a complete guide that outlines the goals your business wants to achieve, including its financial goals . It helps you analyze results, make strategic decisions, show your business operations and growth.

If you want to start a business or already have one and need to pitch it to investors for funding, writing a good business plan improves your chances of attracting financiers. As a startup, if you want to secure loans from financial institutions, part of the requirements involve submitting your business plan.

Writing a business plan does not have to be a complicated or time-consuming process. In this article, you will learn the step-by-step process for writing a successful business plan.

You will also learn what you need a business plan for, tips and strategies for writing a convincing business plan, business plan examples and templates that will save you tons of time, and the alternatives to the traditional business plan.

Let’s get started.

What Do You Need A Business Plan For?

Businesses create business plans for different purposes such as to secure funds, monitor business growth, measure your marketing strategies, and measure your business success.

1. Secure Funds

One of the primary reasons for writing a business plan is to secure funds, either from financial institutions/agencies or investors.

For you to effectively acquire funds, your business plan must contain the key elements of your business plan . For example, your business plan should include your growth plans, goals you want to achieve, and milestones you have recorded.

A business plan can also attract new business partners that are willing to contribute financially and intellectually. If you are writing a business plan to a bank, your project must show your traction , that is, the proof that you can pay back any loan borrowed.

Also, if you are writing to an investor, your plan must contain evidence that you can effectively utilize the funds you want them to invest in your business. Here, you are using your business plan to persuade a group or an individual that your business is a source of a good investment.

2. Monitor Business Growth

A business plan can help you track cash flows in your business. It steers your business to greater heights. A business plan capable of tracking business growth should contain:

• The business goals
• Methods to achieve the goals
• Time-frame for attaining those goals

A good business plan should guide you through every step in achieving your goals. It can also track the allocation of assets to every aspect of the business. You can tell when you are spending more than you should on a project.

You can compare a business plan to a written GPS. It helps you manage your business and hints at the right time to expand your business.

3. Measure Business Success

A business plan can help you measure your business success rate. Some small-scale businesses are thriving better than more prominent companies because of their track record of success.

Right from the onset of your business operation, set goals and work towards them. Write a plan to guide you through your procedures. Use your plan to measure how much you have achieved and how much is left to attain.

You can also weigh your success by monitoring the position of your brand relative to competitors. On the other hand, a business plan can also show you why you have not achieved a goal. It can tell if you have elapsed the time frame you set to attain a goal.

4. Document Your Marketing Strategies

You can use a business plan to document your marketing plans. Every business should have an effective marketing plan.

Competition mandates every business owner to go the extraordinary mile to remain relevant in the market. Your business plan should contain your marketing strategies that work. You can measure the success rate of your marketing plans.

In your business plan, your marketing strategy must answer the questions:

• How do you want to reach your target audience?
• How do you plan to retain your customers?
• What is/are your pricing plans?
• What is your budget for marketing?

How to Write a Business Plan Step-by-Step

1. create your executive summary.

The executive summary is a snapshot of your business or a high-level overview of your business purposes and plans . Although the executive summary is the first section in your business plan, most people write it last. The length of the executive summary is not more than two pages.

Generally, there are nine sections in a business plan, the executive summary should condense essential ideas from the other eight sections.

A good executive summary should do the following:

• A Snapshot of Growth Potential. Briefly inform the reader about your company and why it will be successful)
• Contain your Mission Statement which explains what the main objective or focus of your business is.
• Product Description and Differentiation. Brief description of your products or services and why it is different from other solutions in the market.
• The Team. Basic information about your company’s leadership team and employees
• Business Concept. A solid description of what your business does.
• Target Market. The customers you plan to sell to.
• Marketing Strategy. Your plans on reaching and selling to your customers
• Current Financial State. Brief information about what revenue your business currently generates.
• Projected Financial State. Brief information about what you foresee your business revenue to be in the future.

The executive summary is the make-or-break section of your business plan. If your summary cannot in less than two pages cannot clearly describe how your business will solve a particular problem of your target audience and make a profit, your business plan is set on a faulty foundation.

Avoid using the executive summary to hype your business, instead, focus on helping the reader understand the what and how of your plan.

View the executive summary as an opportunity to introduce your vision for your company. You know your executive summary is powerful when it can answer these key questions:

• Who is your target audience?
• What sector or industry are you in?
• What are your products and services?
• What is the future of your industry?
• Is your company scaleable?
• Who are the owners and leaders of your company? What are their backgrounds and experience levels?
• What is the motivation for starting your company?
• What are the next steps?

Writing the executive summary last although it is the most important section of your business plan is an excellent idea. The reason why is because it is a high-level overview of your business plan. It is the section that determines whether potential investors and lenders will read further or not.

The executive summary can be a stand-alone document that covers everything in your business plan. It is not uncommon for investors to request only the executive summary when evaluating your business. If the information in the executive summary impresses them, they will ask for the complete business plan.

If you are writing your business plan for your planning purposes, you do not need to write the executive summary.

2. Add Your Company Overview

The company overview or description is the next section in your business plan after the executive summary. It describes what your business does.

Adding your company overview can be tricky especially when your business is still in the planning stages. Existing businesses can easily summarize their current operations but may encounter difficulties trying to explain what they plan to become.

Your company overview should contain the following:

• What products and services you will provide
• Geographical markets and locations your company have a presence
• What you need to run your business
• Who your target audience or customers are
• Who will service your customers
• Your company’s purpose, mission, and vision
• Information about your company’s founders
• Who the founders are
• Notable achievements of your company so far

When creating a company overview, you have to focus on three basics: identifying your industry, identifying your customer, and explaining the problem you solve.

If you are stuck when creating your company overview, try to answer some of these questions that pertain to you.

• Who are you targeting? (The answer is not everyone)
• What pain point does your product or service solve for your customers that they will be willing to spend money on resolving?
• How does your product or service overcome that pain point?
• Where is the location of your business?
• What products, equipment, and services do you need to run your business?
• How is your company’s product or service different from your competition in the eyes of your customers?
• How many employees do you need and what skills do you require them to have?

After answering some or all of these questions, you will get more than enough information you need to write your company overview or description section. When writing this section, describe what your company does for your customers.

The company description or overview section contains three elements: mission statement, history, and objectives.

• Mission Statement

The mission statement refers to the reason why your business or company is existing. It goes beyond what you do or sell, it is about the ‘why’. A good mission statement should be emotional and inspirational.

Your mission statement should follow the KISS rule (Keep It Simple, Stupid). For example, Shopify’s mission statement is “Make commerce better for everyone.”

When describing your company’s history, make it simple and avoid the temptation of tying it to a defensive narrative. Write it in the manner you would a profile. Your company’s history should include the following information:

• Founding Date
• Major Milestones
• Location(s)
• Flagship Products or Services
• Number of Employees
• Executive Leadership Roles

When you fill in this information, you use it to write one or two paragraphs about your company’s history.

Business Objectives

Your business objective must be SMART (specific, measurable, achievable, realistic, and time-bound.) Failure to clearly identify your business objectives does not inspire confidence and makes it hard for your team members to work towards a common purpose.

3. Perform Market and Competitive Analyses to Proof a Big Enough Business Opportunity

The third step in writing a business plan is the market and competitive analysis section. Every business, no matter the size, needs to perform comprehensive market and competitive analyses before it enters into a market.

Performing market and competitive analyses are critical for the success of your business. It helps you avoid entering the right market with the wrong product, or vice versa. Anyone reading your business plans, especially financiers and financial institutions will want to see proof that there is a big enough business opportunity you are targeting.

This section is where you describe the market and industry you want to operate in and show the big opportunities in the market that your business can leverage to make a profit. If you noticed any unique trends when doing your research, show them in this section.

Market analysis alone is not enough, you have to add competitive analysis to strengthen this section. There are already businesses in the industry or market, how do you plan to take a share of the market from them?

You have to clearly illustrate the competitive landscape in your business plan. Are there areas your competitors are doing well? Are there areas where they are not doing so well? Show it.

Make it clear in this section why you are moving into the industry and what weaknesses are present there that you plan to explain. How are your competitors going to react to your market entry? How do you plan to get customers? Do you plan on taking your competitors' competitors, tap into other sources for customers, or both?

Illustrate the competitive landscape as well. What are your competitors doing well and not so well?

Answering these questions and thoughts will aid your market and competitive analysis of the opportunities in your space. Depending on how sophisticated your industry is, or the expectations of your financiers, you may need to carry out a more comprehensive market and competitive analysis to prove that big business opportunity.

Instead of looking at the market and competitive analyses as one entity, separating them will make the research even more comprehensive.

Market Analysis

Market analysis, boarding speaking, refers to research a business carried out on its industry, market, and competitors. It helps businesses gain a good understanding of their target market and the outlook of their industry. Before starting a company, it is vital to carry out market research to find out if the market is viable.

The market analysis section is a key part of the business plan. It is the section where you identify who your best clients or customers are. You cannot omit this section, without it your business plan is incomplete.

A good market analysis will tell your readers how you fit into the existing market and what makes you stand out. This section requires in-depth research, it will probably be the most time-consuming part of the business plan to write.

• Market Research

To create a compelling market analysis that will win over investors and financial institutions, you have to carry out thorough market research . Your market research should be targeted at your primary target market for your products or services. Here is what you want to find out about your target market.

• Your target market’s needs or pain points
• The existing solutions for their pain points
• Geographic Location
• Demographics

The purpose of carrying out a marketing analysis is to get all the information you need to show that you have a solid and thorough understanding of your target audience.

Only after you have fully understood the people you plan to sell your products or services to, can you evaluate correctly if your target market will be interested in your products or services.

You can easily convince interested parties to invest in your business if you can show them you thoroughly understand the market and show them that there is a market for your products or services.

How to Quantify Your Target Market

One of the goals of your marketing research is to understand who your ideal customers are and their purchasing power. To quantify your target market, you have to determine the following:

• Your Potential Customers: They are the people you plan to target. For example, if you sell accounting software for small businesses , then anyone who runs an enterprise or large business is unlikely to be your customers. Also, individuals who do not have a business will most likely not be interested in your product.
• Total Households: If you are selling household products such as heating and air conditioning systems, determining the number of total households is more important than finding out the total population in the area you want to sell to. The logic is simple, people buy the product but it is the household that uses it.
• Median Income: You need to know the median income of your target market. If you target a market that cannot afford to buy your products and services, your business will not last long.
• Income by Demographics: If your potential customers belong to a certain age group or gender, determining income levels by demographics is necessary. For example, if you sell men's clothes, your target audience is men.

What Does a Good Market Analysis Entail?

Your business does not exist on its own, it can only flourish within an industry and alongside competitors. Market analysis takes into consideration your industry, target market, and competitors. Understanding these three entities will drastically improve your company’s chances of success.

You can view your market analysis as an examination of the market you want to break into and an education on the emerging trends and themes in that market. Good market analyses include the following:

• Industry Description. You find out about the history of your industry, the current and future market size, and who the largest players/companies are in your industry.
• Overview of Target Market. You research your target market and its characteristics. Who are you targeting? Note, it cannot be everyone, it has to be a specific group. You also have to find out all information possible about your customers that can help you understand how and why they make buying decisions.
• Size of Target Market: You need to know the size of your target market, how frequently they buy, and the expected quantity they buy so you do not risk overproducing and having lots of bad inventory. Researching the size of your target market will help you determine if it is big enough for sustained business or not.
• Growth Potential: Before picking a target market, you want to be sure there are lots of potential for future growth. You want to avoid going for an industry that is declining slowly or rapidly with almost zero growth potential.
• Market Share Potential: Does your business stand a good chance of taking a good share of the market?
• Market Pricing and Promotional Strategies: Your market analysis should give you an idea of the price point you can expect to charge for your products and services. Researching your target market will also give you ideas of pricing strategies you can implement to break into the market or to enjoy maximum profits.
• Potential Barriers to Entry: One of the biggest benefits of conducting market analysis is that it shows you every potential barrier to entry your business will likely encounter. It is a good idea to discuss potential barriers to entry such as changing technology. It informs readers of your business plan that you understand the market.
• Research on Competitors: You need to know the strengths and weaknesses of your competitors and how you can exploit them for the benefit of your business. Find patterns and trends among your competitors that make them successful, discover what works and what doesn’t, and see what you can do better.

The market analysis section is not just for talking about your target market, industry, and competitors. You also have to explain how your company can fill the hole you have identified in the market.

Here are some questions you can answer that can help you position your product or service in a positive light to your readers.

• Is your product or service of superior quality?
• What additional features do you offer that your competitors do not offer?
• Are you targeting a ‘new’ market?

Basically, your market analysis should include an analysis of what already exists in the market and an explanation of how your company fits into the market.

Competitive Analysis

In the competitive analysis section, y ou have to understand who your direct and indirect competitions are, and how successful they are in the marketplace. It is the section where you assess the strengths and weaknesses of your competitors, the advantage(s) they possess in the market and show the unique features or qualities that make you different from your competitors.

Many businesses do market analysis and competitive analysis together. However, to fully understand what the competitive analysis entails, it is essential to separate it from the market analysis.

Competitive analysis for your business can also include analysis on how to overcome barriers to entry in your target market.

The primary goal of conducting a competitive analysis is to distinguish your business from your competitors. A strong competitive analysis is essential if you want to convince potential funding sources to invest in your business. You have to show potential investors and lenders that your business has what it takes to compete in the marketplace successfully.

Competitive analysis will s how you what the strengths of your competition are and what they are doing to maintain that advantage.

When doing your competitive research, you first have to identify your competitor and then get all the information you can about them. The idea of spending time to identify your competitor and learn everything about them may seem daunting but it is well worth it.

Find answers to the following questions after you have identified who your competitors are.

• What are your successful competitors doing?
• Why is what they are doing working?
• Can your business do it better?
• What are the weaknesses of your successful competitors?
• What are they not doing well?
• Can your business turn its weaknesses into strengths?
• How good is your competitors’ customer service?
• Where do your competitors invest in advertising?
• What sales and pricing strategies are they using?
• What marketing strategies are they using?
• What kind of press coverage do they get?
• What are their customers saying about your competitors (both the positive and negative)?

If your competitors have a website, it is a good idea to visit their websites for more competitors’ research. Check their “About Us” page for more information.

If you are presenting your business plan to investors, you need to clearly distinguish yourself from your competitors. Investors can easily tell when you have not properly researched your competitors.

Take time to think about what unique qualities or features set you apart from your competitors. If you do not have any direct competition offering your product to the market, it does not mean you leave out the competitor analysis section blank. Instead research on other companies that are providing a similar product, or whose product is solving the problem your product solves.

The next step is to create a table listing the top competitors you want to include in your business plan. Ensure you list your business as the last and on the right. What you just created is known as the competitor analysis table.

Direct vs Indirect Competition

You cannot know if your product or service will be a fit for your target market if you have not understood your business and the competitive landscape.

There is no market you want to target where you will not encounter competition, even if your product is innovative. Including competitive analysis in your business plan is essential.

If you are entering an established market, you need to explain how you plan to differentiate your products from the available options in the market. Also, include a list of few companies that you view as your direct competitors The competition you face in an established market is your direct competition.

In situations where you are entering a market with no direct competition, it does not mean there is no competition there. Consider your indirect competition that offers substitutes for the products or services you offer.

For example, if you sell an innovative SaaS product, let us say a project management software , a company offering time management software is your indirect competition.

There is an easy way to find out who your indirect competitors are in the absence of no direct competitors. You simply have to research how your potential customers are solving the problems that your product or service seeks to solve. That is your direct competition.

Factors that Differentiate Your Business from the Competition

There are three main factors that any business can use to differentiate itself from its competition. They are cost leadership, product differentiation, and market segmentation.

1. Cost Leadership

A strategy you can impose to maximize your profits and gain an edge over your competitors. It involves offering lower prices than what the majority of your competitors are offering.

A common practice among businesses looking to enter into a market where there are dominant players is to use free trials or pricing to attract as many customers as possible to their offer.

2. Product Differentiation

Your product or service should have a unique selling proposition (USP) that your competitors do not have or do not stress in their marketing.

Part of the marketing strategy should involve making your products unique and different from your competitors. It does not have to be different from your competitors, it can be the addition to a feature or benefit that your competitors do not currently have.

3. Market Segmentation

As a new business seeking to break into an industry, you will gain more success from focusing on a specific niche or target market, and not the whole industry.

If your competitors are focused on a general need or target market, you can differentiate yourself from them by having a small and hyper-targeted audience. For example, if your competitors are selling men’s clothes in their online stores , you can sell hoodies for men.

4. Define Your Business and Management Structure

The next step in your business plan is your business and management structure. It is the section where you describe the legal structure of your business and the team running it.

Your business is only as good as the management team that runs it, while the management team can only strive when there is a proper business and management structure in place.

If your company is a sole proprietor or a limited liability company (LLC), a general or limited partnership, or a C or an S corporation, state it clearly in this section.

Use an organizational chart to show the management structure in your business. Clearly show who is in charge of what area in your company. It is where you show how each key manager or team leader’s unique experience can contribute immensely to the success of your company. You can also opt to add the resumes and CVs of the key players in your company.

The business and management structure section should show who the owner is, and other owners of the businesses (if the business has other owners). For businesses or companies with multiple owners, include the percent ownership of the various owners and clearly show the extent of each others’ involvement in the company.

Investors want to know who is behind the company and the team running it to determine if it has the right management to achieve its set goals.

Management Team

The management team section is where you show that you have the right team in place to successfully execute the business operations and ideas. Take time to create the management structure for your business. Think about all the important roles and responsibilities that you need managers for to grow your business.

Include brief bios of each key team member and ensure you highlight only the relevant information that is needed. If your team members have background industry experience or have held top positions for other companies and achieved success while filling that role, highlight it in this section.

A common mistake that many startups make is assigning C-level titles such as (CMO and CEO) to everyone on their team. It is unrealistic for a small business to have those titles. While it may look good on paper for the ego of your team members, it can prevent investors from investing in your business.

Instead of building an unrealistic management structure that does not fit your business reality, it is best to allow business titles to grow as the business grows. Starting everyone at the top leaves no room for future change or growth, which is bad for productivity.

Your management team does not have to be complete before you start writing your business plan. You can have a complete business plan even when there are managerial positions that are empty and need filling.

If you have management gaps in your team, simply show the gaps and indicate you are searching for the right candidates for the role(s). Investors do not expect you to have a full management team when you are just starting your business.

Key Questions to Answer When Structuring Your Management Team

• Who are the key leaders?
• What experiences, skills, and educational backgrounds do you expect your key leaders to have?
• Do your key leaders have industry experience?
• What positions will they fill and what duties will they perform in those positions?
• What level of authority do the key leaders have and what are their responsibilities?
• What is the salary for the various management positions that will attract the ideal candidates?

Additional Tips for Writing the Management Structure Section

1. Avoid Adding ‘Ghost’ Names to Your Management Team

There is always that temptation to include a ‘ghost’ name to your management team to attract and influence investors to invest in your business. Although the presence of these celebrity management team members may attract the attention of investors, it can cause your business to lose any credibility if you get found out.

Seasoned investors will investigate further the members of your management team before committing fully to your business If they find out that the celebrity name used does not play any actual role in your business, they will not invest and may write you off as dishonest.

2. Focus on Credentials But Pay Extra Attention to the Roles

Investors want to know the experience that your key team members have to determine if they can successfully reach the company’s growth and financial goals.

While it is an excellent boost for your key management team to have the right credentials, you also want to pay extra attention to the roles they will play in your company.

Organizational Chart

Adding an organizational chart in this section of your business plan is not necessary, you can do it in your business plan’s appendix.

If you are exploring funding options, it is not uncommon to get asked for your organizational chart. The function of an organizational chart goes beyond raising money, you can also use it as a useful planning tool for your business.

An organizational chart can help you identify how best to structure your management team for maximum productivity and point you towards key roles you need to fill in the future.

You can use the organizational chart to show your company’s internal management structure such as the roles and responsibilities of your management team, and relationships that exist between them.

5. Describe Your Product and Service Offering

In your business plan, you have to describe what you sell or the service you plan to offer. It is the next step after defining your business and management structure. The products and services section is where you sell the benefits of your business.

Here you have to explain how your product or service will benefit your customers and describe your product lifecycle. It is also the section where you write down your plans for intellectual property like patent filings and copyrighting.

The research and development that you are undertaking for your product or service need to be explained in detail in this section. However, do not get too technical, sell the general idea and its benefits.

If you have any diagrams or intricate designs of your product or service, do not include them in the products and services section. Instead, leave them for the addendum page. Also, if you are leaving out diagrams or designs for the addendum, ensure you add this phrase “For more detail, visit the addendum Page #.”

Your product and service section in your business plan should include the following:

• A detailed explanation that clearly shows how your product or service works.
• The pricing model for your product or service.
• Your business’ sales and distribution strategy.
• The ideal customers that want your product or service.
• The benefits of your products and services.
• Reason(s) why your product or service is a better alternative to what your competitors are currently offering in the market.
• Plans for filling the orders you receive
• If you have current or pending patents, copyrights, and trademarks for your product or service, you can also discuss them in this section.

What to Focus On When Describing the Benefits, Lifecycle, and Production Process of Your Products or Services

In the products and services section, you have to distill the benefits, lifecycle, and production process of your products and services.

When describing the benefits of your products or services, here are some key factors to focus on.

• Unique features
• Translating the unique features into benefits
• The emotional, psychological, and practical payoffs to attract customers
• Intellectual property rights or any patents

When describing the product life cycle of your products or services, here are some key factors to focus on.

• Upsells, cross-sells, and down-sells
• Time between purchases
• Plans for research and development.

When describing the production process for your products or services, you need to think about the following:

• The creation of new or existing products and services.
• The sources for the raw materials or components you need for production.
• Assembling the products
• Maintaining quality control
• Supply-chain logistics (receiving the raw materials and delivering the finished products)
• The day-to-day management of the production processes, bookkeeping, and inventory.

Tips for Writing the Products or Services Section of Your Business Plan

1. Avoid Technical Descriptions and Industry Buzzwords

The products and services section of your business plan should clearly describe the products and services that your company provides. However, it is not a section to include technical jargons that anyone outside your industry will not understand.

A good practice is to remove highly detailed or technical descriptions in favor of simple terms. Industry buzzwords are not necessary, if there are simpler terms you can use, then use them. If you plan to use your business plan to source funds, making the product or service section so technical will do you no favors.

2. Describe How Your Products or Services Differ from Your Competitors

When potential investors look at your business plan, they want to know how the products and services you are offering differ from that of your competition. Differentiating your products or services from your competition in a way that makes your solution more attractive is critical.

If you are going the innovative path and there is no market currently for your product or service, you need to describe in this section why the market needs your product or service.

For example, overnight delivery was a niche business that only a few companies were participating in. Federal Express (FedEx) had to show in its business plan that there was a large opportunity for that service and they justified why the market needed that service.

3. Long or Short Products or Services Section

Should your products or services section be short? Does the long products or services section attract more investors?

There are no straightforward answers to these questions. Whether your products or services section should be long or relatively short depends on the nature of your business.

If your business is product-focused, then automatically you need to use more space to describe the details of your products. However, if the product your business sells is a commodity item that relies on competitive pricing or other pricing strategies, you do not have to use up so much space to provide significant details about the product.

Likewise, if you are selling a commodity that is available in numerous outlets, then you do not have to spend time on writing a long products or services section.

The key to the success of your business is most likely the effectiveness of your marketing strategies compared to your competitors. Use more space to address that section.

If you are creating a new product or service that the market does not know about, your products or services section can be lengthy. The reason why is because you need to explain everything about the product or service such as the nature of the product, its use case, and values.

A short products or services section for an innovative product or service will not give the readers enough information to properly evaluate your business.

4. Describe Your Relationships with Vendors or Suppliers

Your business will rely on vendors or suppliers to supply raw materials or the components needed to make your products. In your products and services section, describe your relationships with your vendors and suppliers fully.

Avoid the mistake of relying on only one supplier or vendor. If that supplier or vendor fails to supply or goes out of business, you can easily face supply problems and struggle to meet your demands. Plan to set up multiple vendor or supplier relationships for better business stability.

5. Your Primary Goal Is to Convince Your Readers

The primary goal of your business plan is to convince your readers that your business is viable and to create a guide for your business to follow. It applies to the products and services section.

When drafting this section, think like the reader. See your reader as someone who has no idea about your products and services. You are using the products and services section to provide the needed information to help your reader understand your products and services. As a result, you have to be clear and to the point.

While you want to educate your readers about your products or services, you also do not want to bore them with lots of technical details. Show your products and services and not your fancy choice of words.

Your products and services section should provide the answer to the “what” question for your business. You and your management team may run the business, but it is your products and services that are the lifeblood of the business.

Key Questions to Answer When Writing your Products and Services Section

Answering these questions can help you write your products and services section quickly and in a way that will appeal to your readers.

• Are your products existing on the market or are they still in the development stage?
• What is your timeline for adding new products and services to the market?
• What are the positives that make your products and services different from your competitors?
• Do your products and services have any competitive advantage that your competitors’ products and services do not currently have?
• Do your products or services have any competitive disadvantages that you need to overcome to compete with your competitors? If your answer is yes, state how you plan to overcome them,
• How much does it cost to produce your products or services? How much do you plan to sell it for?
• What is the price for your products and services compared to your competitors? Is pricing an issue?
• What are your operating costs and will it be low enough for you to compete with your competitors and still take home a reasonable profit margin?
• What is your plan for acquiring your products? Are you involved in the production of your products or services?
• Are you the manufacturer and produce all the components you need to create your products? Do you assemble your products by using components supplied by other manufacturers? Do you purchase your products directly from suppliers or wholesalers?
• Do you have a steady supply of products that you need to start your business? (If your business is yet to kick-off)
• How do you plan to distribute your products or services to the market?

You can also hint at the marketing or promotion plans you have for your products or services such as how you plan to build awareness or retain customers. The next section is where you can go fully into details about your business’s marketing and sales plan.

6. Show and Explain Your Marketing and Sales Plan

Providing great products and services is wonderful, but it means nothing if you do not have a marketing and sales plan to inform your customers about them. Your marketing and sales plan is critical to the success of your business.

The sales and marketing section is where you show and offer a detailed explanation of your marketing and sales plan and how you plan to execute it. It covers your pricing plan, proposed advertising and promotion activities, activities and partnerships you need to make your business a success, and the benefits of your products and services.

There are several ways you can approach your marketing and sales strategy. Ideally, your marketing and sales strategy has to fit the unique needs of your business.

In this section, you describe how the plans your business has for attracting and retaining customers, and the exact process for making a sale happen. It is essential to thoroughly describe your complete marketing and sales plans because you are still going to reference this section when you are making financial projections for your business.

Outline Your Business’ Unique Selling Proposition (USP)

The sales and marketing section is where you outline your business’s unique selling proposition (USP). When you are developing your unique selling proposition, think about the strongest reasons why people should buy from you over your competition. That reason(s) is most likely a good fit to serve as your unique selling proposition (USP).

Target Market and Target Audience

Plans on how to get your products or services to your target market and how to get your target audience to buy them go into this section. You also highlight the strengths of your business here, particularly what sets them apart from your competition.

Before you start writing your marketing and sales plan, you need to have properly defined your target audience and fleshed out your buyer persona. If you do not first understand the individual you are marketing to, your marketing and sales plan will lack any substance and easily fall.

Creating a Smart Marketing and Sales Plan

Marketing your products and services is an investment that requires you to spend money. Like any other investment, you have to generate a good return on investment (ROI) to justify using that marketing and sales plan. Good marketing and sales plans bring in high sales and profits to your company.

Avoid spending money on unproductive marketing channels. Do your research and find out the best marketing and sales plan that works best for your company.

Your marketing and sales plan can be broken into different parts: your positioning statement, pricing, promotion, packaging, advertising, public relations, content marketing, social media, and strategic alliances.

Your Positioning Statement

Your positioning statement is the first part of your marketing and sales plan. It refers to the way you present your company to your customers.

Are you the premium solution, the low-price solution, or are you the intermediary between the two extremes in the market? What do you offer that your competitors do not that can give you leverage in the market?

Before you start writing your positioning statement, you need to spend some time evaluating the current market conditions. Here are some questions that can help you to evaluate the market

• What are the unique features or benefits that you offer that your competitors lack?
• What are your customers’ primary needs and wants?
• Why should a customer choose you over your competition? How do you plan to differentiate yourself from the competition?
• How does your company’s solution compare with other solutions in the market?

After answering these questions, then you can start writing your positioning statement. Your positioning statement does not have to be in-depth or too long.

All you need to explain with your positioning statement are two focus areas. The first is the position of your company within the competitive landscape. The other focus area is the core value proposition that sets your company apart from other alternatives that your ideal customer might consider.

Here is a simple template you can use to develop a positioning statement.

For [description of target market] who [need of target market], [product or service] [how it meets the need]. Unlike [top competition], it [most essential distinguishing feature].

For example, let’s create the positioning statement for fictional accounting software and QuickBooks alternative , TBooks.

“For small business owners who need accounting services, TBooks is an accounting software that helps small businesses handle their small business bookkeeping basics quickly and easily. Unlike Wave, TBooks gives small businesses access to live sessions with top accountants.”

You can edit this positioning statement sample and fill it with your business details.

After writing your positioning statement, the next step is the pricing of your offerings. The overall positioning strategy you set in your positioning statement will often determine how you price your products or services.

Pricing is a powerful tool that sends a strong message to your customers. Failure to get your pricing strategy right can make or mar your business. If you are targeting a low-income audience, setting a premium price can result in low sales.

You can use pricing to communicate your positioning to your customers. For example, if you are offering a product at a premium price, you are sending a message to your customers that the product belongs to the premium category.

Basic Rules to Follow When Pricing Your Offering

Setting a price for your offering involves more than just putting a price tag on it. Deciding on the right pricing for your offering requires following some basic rules. They include covering your costs, primary and secondary profit center pricing, and matching the market rate.

• Covering Your Costs: The price you set for your products or service should be more than it costs you to produce and deliver them. Every business has the same goal, to make a profit. Depending on the strategy you want to use, there are exceptions to this rule. However, the vast majority of businesses follow this rule.
• Primary and Secondary Profit Center Pricing: When a company sets its price above the cost of production, it is making that product its primary profit center. A company can also decide not to make its initial price its primary profit center by selling below or at even with its production cost. It rather depends on the support product or even maintenance that is associated with the initial purchase to make its profit. The initial price thus became its secondary profit center.
• Matching the Market Rate: A good rule to follow when pricing your products or services is to match your pricing with consumer demand and expectations. If you price your products or services beyond the price your customer perceives as the ideal price range, you may end up with no customers. Pricing your products too low below what your customer perceives as the ideal price range may lead to them undervaluing your offering.

Pricing Strategy

Your pricing strategy influences the price of your offering. There are several pricing strategies available for you to choose from when examining the right pricing strategy for your business. They include cost-plus pricing, market-based pricing, value pricing, and more.

• Cost-plus Pricing: This strategy is one of the simplest and oldest pricing strategies. Here you consider the cost of producing a unit of your product and then add a profit to it to arrive at your market price. It is an effective pricing strategy for manufacturers because it helps them cover their initial costs. Another name for the cost-plus pricing strategy is the markup pricing strategy.
• Market-based Pricing: This pricing strategy analyses the market including competitors’ pricing and then sets a price based on what the market is expecting. With this pricing strategy, you can either set your price at the low-end or high-end of the market.
• Value Pricing: This pricing strategy involves setting a price based on the value you are providing to your customer. When adopting a value-based pricing strategy, you have to set a price that your customers are willing to pay. Service-based businesses such as small business insurance providers , luxury goods sellers, and the fashion industry use this pricing strategy.

After carefully sorting out your positioning statement and pricing, the next item to look at is your promotional strategy. Your promotional strategy explains how you plan on communicating with your customers and prospects.

As a business, you must measure all your costs, including the cost of your promotions. You also want to measure how much sales your promotions bring for your business to determine its usefulness. Promotional strategies or programs that do not lead to profit need to be removed.

There are different types of promotional strategies you can adopt for your business, they include advertising, public relations, and content marketing.

Advertising

Your business plan should include your advertising plan which can be found in the marketing and sales plan section. You need to include an overview of your advertising plans such as the areas you plan to spend money on to advertise your business and offers.

Ensure that you make it clear in this section if your business will be advertising online or using the more traditional offline media, or the combination of both online and offline media. You can also include the advertising medium you want to use to raise awareness about your business and offers.

Some common online advertising mediums you can use include social media ads, landing pages, sales pages, SEO, Pay-Per-Click, emails, Google Ads, and others. Some common traditional and offline advertising mediums include word of mouth, radios, direct mail, televisions, flyers, billboards, posters, and others.

A key component of your advertising strategy is how you plan to measure the effectiveness and success of your advertising campaign. There is no point in sticking with an advertising plan or medium that does not produce results for your business in the long run.

Public Relations

A great way to reach your customers is to get the media to cover your business or product. Publicity, especially good ones, should be a part of your marketing and sales plan. In this section, show your plans for getting prominent reviews of your product from reputable publications and sources.

Your business needs that exposure to grow. If public relations is a crucial part of your promotional strategy, provide details about your public relations plan here.

Content Marketing

Content marketing is a popular promotional strategy used by businesses to inform and attract their customers. It is about teaching and educating your prospects on various topics of interest in your niche, it does not just involve informing them about the benefits and features of the products and services you have,

Businesses publish content usually for free where they provide useful information, tips, and advice so that their target market can be made aware of the importance of their products and services. Content marketing strategies seek to nurture prospects into buyers over time by simply providing value.

Your company can create a blog where it will be publishing content for its target market. You will need to use the best website builder such as Wix and Squarespace and the best web hosting services such as Bluehost, Hostinger, and other Bluehost alternatives to create a functional blog or website.

If content marketing is a crucial part of your promotional strategy (as it should be), detail your plans under promotions.

Including high-quality images of the packaging of your product in your business plan is a lovely idea. You can add the images of the packaging of that product in the marketing and sales plan section. If you are not selling a product, then you do not need to include any worry about the physical packaging of your product.

When organizing the packaging section of your business plan, you can answer the following questions to make maximum use of this section.

• Is your choice of packaging consistent with your positioning strategy?
• What key value proposition does your packaging communicate? (It should reflect the key value proposition of your business)
• How does your packaging compare to that of your competitors?

Social Media

Your 21st-century business needs to have a good social media presence. Not having one is leaving out opportunities for growth and reaching out to your prospect.

You do not have to join the thousands of social media platforms out there. What you need to do is join the ones that your customers are active on and be active there.

Businesses use social media to provide information about their products such as promotions, discounts, the benefits of their products, and content on their blogs.

Social media is also a platform for engaging with your customers and getting feedback about your products or services. Make no mistake, more and more of your prospects are using social media channels to find more information about companies.

You need to consider the social media channels you want to prioritize your business (prioritize the ones your customers are active in) and your branding plans in this section.

Strategic Alliances

If your company plans to work closely with other companies as part of your sales and marketing plan, include it in this section. Prove details about those partnerships in your business plan if you have already established them.

Strategic alliances can be beneficial for all parties involved including your company. Working closely with another company in the form of a partnership can provide access to a different target market segment for your company.

The company you are partnering with may also gain access to your target market or simply offer a new product or service (that of your company) to its customers.

Mutually beneficial partnerships can cover the weaknesses of one company with the strength of another. You should consider strategic alliances with companies that sell complimentary products to yours. For example, if you provide printers, you can partner with a company that produces ink since the customers that buy printers from you will also need inks for printing.

Steps Involved in Creating a Marketing and Sales Plan

1. Focus on Your Target Market

Identify who your customers are, the market you want to target. Then determine the best ways to get your products or services to your potential customers.

2. Evaluate Your Competition

One of the goals of having a marketing plan is to distinguish yourself from your competition. You cannot stand out from them without first knowing them in and out.

You can know your competitors by gathering information about their products, pricing, service, and advertising campaigns.

These questions can help you know your competition.

• What makes your competition successful?
• What are their weaknesses?
• What are customers saying about your competition?

3. Consider Your Brand

Customers' perception of your brand has a strong impact on your sales. Your marketing and sales plan should seek to bolster the image of your brand. Before you start marketing your business, think about the message you want to pass across about your business and your products and services.

4. Focus on Benefits

The majority of your customers do not view your product in terms of features, what they want to know is the benefits and solutions your product offers. Think about the problems your product solves and the benefits it delivers, and use it to create the right sales and marketing message.

Your marketing plan should focus on what you want your customer to get instead of what you provide. Identify those benefits in your marketing and sales plan.

5. Focus on Differentiation

Your marketing and sales plan should look for a unique angle they can take that differentiates your business from the competition, even if the products offered are similar. Some good areas of differentiation you can use are your benefits, pricing, and features.

Key Questions to Answer When Writing Your Marketing and Sales Plan

• What is your company’s budget for sales and marketing campaigns?
• What key metrics will you use to determine if your marketing plans are successful?
• What are your alternatives if your initial marketing efforts do not succeed?
• Who are the sales representatives you need to promote your products or services?
• What are the marketing and sales channels you plan to use? How do you plan to get your products in front of your ideal customers?
• Where will you sell your products?

You may want to include samples of marketing materials you plan to use such as print ads, website descriptions, and social media ads. While it is not compulsory to include these samples, it can help you better communicate your marketing and sales plan and objectives.

The purpose of the marketing and sales section is to answer this question “How will you reach your customers?” If you cannot convincingly provide an answer to this question, you need to rework your marketing and sales section.

7. Clearly Show Your Funding Request

If you are writing your business plan to ask for funding from investors or financial institutions, the funding request section is where you will outline your funding requirements. The funding request section should answer the question ‘How much money will your business need in the near future (3 to 5 years)?’

A good funding request section will clearly outline and explain the amount of funding your business needs over the next five years. You need to know the amount of money your business needs to make an accurate funding request.

Also, when writing your funding request, provide details of how the funds will be used over the period. Specify if you want to use the funds to buy raw materials or machinery, pay salaries, pay for advertisements, and cover specific bills such as rent and electricity.

In addition to explaining what you want to use the funds requested for, you need to clearly state the projected return on investment (ROI) . Investors and creditors want to know if your business can generate profit for them if they put funds into it.

Ensure you do not inflate the figures and stay as realistic as possible. Investors and financial institutions you are seeking funds from will do their research before investing money in your business.

If you are not sure of an exact number to request from, you can use some range of numbers as rough estimates. Add a best-case scenario and a work-case scenario to your funding request. Also, include a description of your strategic future financial plans such as selling your business or paying off debts.

Funding Request: Debt or Equity?

When making your funding request, specify the type of funding you want. Do you want debt or equity? Draw out the terms that will be applicable for the funding, and the length of time the funding request will cover.

Case for Equity

If your new business has not yet started generating profits, you are most likely preparing to sell equity in your business to raise capital at the early stage. Equity here refers to ownership. In this case, you are selling a portion of your company to raise capital.

Although this method of raising capital for your business does not put your business in debt, keep in mind that an equity owner may expect to play a key role in company decisions even if he does not hold a major stake in the company.

Most equity sales for startups are usually private transactions . If you are making a funding request by offering equity in exchange for funding, let the investor know that they will be paid a dividend (a share of the company’s profit). Also, let the investor know the process for selling their equity in your business.

Case for Debt

You may decide not to offer equity in exchange for funds, instead, you make a funding request with the promise to pay back the money borrowed at the agreed time frame.

When making a funding request with an agreement to pay back, note that you will have to repay your creditors both the principal amount borrowed and the interest on it. Financial institutions offer this type of funding for businesses.

Large companies combine both equity and debt in their capital structure. When drafting your business plan, decide if you want to offer both or one over the other.

Before you sell equity in exchange for funding in your business, consider if you are willing to accept not being in total control of your business. Also, before you seek loans in your funding request section, ensure that the terms of repayment are favorable.

You should set a clear timeline in your funding request so that potential investors and creditors can know what you are expecting. Some investors and creditors may agree to your funding request and then delay payment for longer than 30 days, meanwhile, your business needs an immediate cash injection to operate efficiently.

Additional Tips for Writing the Funding Request Section of your Business Plan

The funding request section is not necessary for every business, it is only needed by businesses who plan to use their business plan to secure funding.

If you are adding the funding request section to your business plan, provide an itemized summary of how you plan to use the funds requested. Hiring a lawyer, accountant, or other professionals may be necessary for the proper development of this section.

You should also gather and use financial statements that add credibility and support to your funding requests. Ensure that the financial statements you use should include your projected financial data such as projected cash flows, forecast statements, and expenditure budgets.

If you are an existing business, include all historical financial statements such as cash flow statements, balance sheets and income statements .

Provide monthly and quarterly financial statements for a year. If your business has records that date back beyond the one-year mark, add the yearly statements of those years. These documents are for the appendix section of your business plan.

8. Detail Your Financial Plan, Metrics, and Projections

If you used the funding request section in your business plan, supplement it with a financial plan, metrics, and projections. This section paints a picture of the past performance of your business and then goes ahead to make an informed projection about its future.

The goal of this section is to convince readers that your business is going to be a financial success. It outlines your business plan to generate enough profit to repay the loan (with interest if applicable) and to generate a decent return on investment for investors.

If you have an existing business already in operation, use this section to demonstrate stability through finance. This section should include your cash flow statements, balance sheets, and income statements covering the last three to five years. If your business has some acceptable collateral that you can use to acquire loans, list it in the financial plan, metrics, and projection section.

Apart from current financial statements, this section should also contain a prospective financial outlook that spans the next five years. Include forecasted income statements, cash flow statements, balance sheets, and capital expenditure budget.

If your business is new and is not yet generating profit, use clear and realistic projections to show the potentials of your business.

When drafting this section, research industry norms and the performance of comparable businesses. Your financial projections should cover at least five years. State the logic behind your financial projections. Remember you can always make adjustments to this section as the variables change.

The financial plan, metrics, and projection section create a baseline which your business can either exceed or fail to reach. If your business fails to reach your projections in this section, you need to understand why it failed.

Investors and loan managers spend a lot of time going through the financial plan, metrics, and projection section compared to other parts of the business plan. Ensure you spend time creating credible financial analyses for your business in this section.

Many entrepreneurs find this section daunting to write. You do not need a business degree to create a solid financial forecast for your business. Business finances, especially for startups, are not as complicated as they seem. There are several online tools and templates that make writing this section so much easier.

Use Graphs and Charts

The financial plan, metrics, and projection section is a great place to use graphs and charts to tell the financial story of your business. Charts and images make it easier to communicate your finances.

Accuracy in this section is key, ensure you carefully analyze your past financial statements properly before making financial projects.

Address the Risk Factors and Show Realistic Financial Projections

Keep your financial plan, metrics, and projection realistic. It is okay to be optimistic in your financial projection, however, you have to justify it.

You should also address the various risk factors associated with your business in this section. Investors want to know the potential risks involved, show them. You should also show your plans for mitigating those risks.

What You Should In The Financial Plan, Metrics, and Projection Section of Your Business Plan

The financial plan, metrics, and projection section of your business plan should have monthly sales and revenue forecasts for the first year. It should also include annual projections that cover 3 to 5 years.

A three-year projection is a basic requirement to have in your business plan. However, some investors may request a five-year forecast.

Your business plan should include the following financial statements: sales forecast, personnel plan, income statement, income statement, cash flow statement, balance sheet, and an exit strategy.

1. Sales Forecast

Sales forecast refers to your projections about the number of sales your business is going to record over the next few years. It is typically broken into several rows, with each row assigned to a core product or service that your business is offering.

One common mistake people make in their business plan is to break down the sales forecast section into long details. A sales forecast should forecast the high-level details.

For example, if you are forecasting sales for a payroll software provider, you could break down your forecast into target market segments or subscription categories.

Your sales forecast section should also have a corresponding row for each sales row to cover the direct cost or Cost of Goods Sold (COGS). The objective of these rows is to show the expenses that your business incurs in making and delivering your product or service.

Note that your Cost of Goods Sold (COGS) should only cover those direct costs incurred when making your products. Other indirect expenses such as insurance, salaries, payroll tax, and rent should not be included.

For example, the Cost of Goods Sold (COGS) for a restaurant is the cost of ingredients while for a consulting company it will be the cost of paper and other presentation materials.

2. Personnel Plan

The personnel plan section is where you provide details about the payment plan for your employees. For a small business, you can easily list every position in your company and how much you plan to pay in the personnel plan.

However, for larger businesses, you have to break the personnel plan into functional groups such as sales and marketing.

The personnel plan will also include the cost of an employee beyond salary, commonly referred to as the employee burden. These costs include insurance, payroll taxes , and other essential costs incurred monthly as a result of having employees on your payroll.

3. Income Statement

The income statement section shows if your business is making a profit or taking a loss. Another name for the income statement is the profit and loss (P&L). It takes data from your sales forecast and personnel plan and adds other ongoing expenses you incur while running your business.

Every business plan should have an income statement. It subtracts your business expenses from its earnings to show if your business is generating profit or incurring losses.

The income statement has the following items: sales, Cost of Goods Sold (COGS), gross margin, operating expenses, total operating expenses, operating income , total expenses, and net profit.

• Sales refer to the revenue your business generates from selling its products or services. Other names for sales are income or revenue.
• Cost of Goods Sold (COGS) refers to the total cost of selling your products. Other names for COGS are direct costs or cost of sales. Manufacturing businesses use the Costs of Goods Manufactured (COGM) .
• Gross Margin is the figure you get when you subtract your COGS from your sales. In your income statement, you can express it as a percentage of total sales (Gross margin / Sales = Gross Margin Percent).
• Operating Expenses refer to all the expenses you incur from running your business. It exempts the COGS because it stands alone as a core part of your income statement. You also have to exclude taxes, depreciation, and amortization. Your operating expenses include salaries, marketing expenses, research and development (R&D) expenses, and other expenses.
• Total Operating Expenses refers to the sum of all your operating expenses including those exemptions named above under operating expenses.
• Operating Income refers to earnings before interest, taxes, depreciation, and amortization. It is simply known as the acronym EBITDA (earnings before interest, taxes, depreciation, and amortization). Calculating your operating income is simple, all you need to do is to subtract your COGS and total operating expenses from your sales.
• Total Expenses refer to the sum of your operating expenses and your business’ interest, taxes, depreciation, and amortization.
• Net profit shows whether your business has made a profit or taken a loss during a given timeframe.

4. Cash Flow Statement

The cash flow statement tracks the money you have in the bank at any given point. It is often confused with the income statement or the profit and loss statement. They are both different types of financial statements. The income statement calculates your profits and losses while the cash flow statement shows you how much you have in the bank.

5. Balance Sheet

The balance sheet is a financial statement that provides an overview of the financial health of your business. It contains information about the assets and liabilities of your company, and owner’s or shareholders’ equity.

You can get the net worth of your company by subtracting your company’s liabilities from its assets.

6. Exit Strategy

The exit strategy refers to a probable plan for selling your business either to the public in an IPO or to another company. It is the last thing you include in the financial plan, metrics, and projection section.

You can choose to omit the exit strategy from your business plan if you plan to maintain full ownership of your business and do not plan on seeking angel investment or virtual capitalist (VC) funding.

Investors may want to know what your exit plan is. They invest in your business to get a good return on investment.

Your exit strategy does not have to include long and boring details. Ensure you identify some interested parties who may be interested in buying the company if it becomes a success.

Key Questions to Answer with Your Financial Plan, Metrics, and Projection

Your financial plan, metrics, and projection section helps investors, creditors, or your internal managers to understand what your expenses are, the amount of cash you need, and what it takes to make your company profitable. It also shows what you will be doing with any funding.

You do not need to show actual financial data if you do not have one. Adding forecasts and projections to your financial statements is added proof that your strategy is feasible and shows investors you have planned properly.

Here are some key questions to answer to help you develop this section.

• What is your sales forecast for the next year?
• When will your company achieve a positive cash flow?
• What are the core expenses you need to operate?
• How much money do you need upfront to operate or grow your company?
• How will you use the loans or investments?

9. Add an Appendix to Your Business Plan

Adding an appendix to your business plan is optional. It is a useful place to put any charts, tables, legal notes, definitions, permits, résumés, and other critical information that do not fit into other sections of your business plan.

The appendix section is where you would want to include details of a patent or patent-pending if you have one. You can always add illustrations or images of your products here. It is the last section of your business plan.

When writing your business plan, there are details you cut short or remove to prevent the entire section from becoming too lengthy. There are also details you want to include in the business plan but are not a good fit for any of the previous sections. You can add that additional information to the appendix section.

Businesses also use the appendix section to include supporting documents or other materials specially requested by investors or lenders.

You can include just about any information that supports the assumptions and statements you made in the business plan under the appendix. It is the one place in the business plan where unrelated data and information can coexist amicably.

If your appendix section is lengthy, try organizing it by adding a table of contents at the beginning of the appendix section. It is also advisable to group similar information to make it easier for the reader to access them.

A well-organized appendix section makes it easier to share your information clearly and concisely. Add footnotes throughout the rest of the business plan or make references in the plan to the documents in the appendix.

The appendix section is usually only necessary if you are seeking funding from investors or lenders, or hoping to attract partners.

People reading business plans do not want to spend time going through a heap of backup information, numbers, and charts. Keep these documents or information in the Appendix section in case the reader wants to dig deeper.

Common Items to Include in the Appendix Section of Your Business Plan

The appendix section includes documents that supplement or support the information or claims given in other sections of the business plans. Common items you can include in the appendix section include:

• Additional data about the process of manufacturing or creation
• Additional description of products or services such as product schematics
• Additional financial documents or projections
• Articles of incorporation and status
• Backup for market research or competitive analysis
• Bank statements
• Business registries
• Client testimonials (if your business is already running)
• Copies of insurances
• Credit histories (personal or/and business)
• Deeds and permits
• Equipment leases
• Examples of marketing and advertising collateral
• Industry associations and memberships
• Images of product
• Intellectual property
• Key customer contracts
• Legal documents and other contracts
• Letters of reference
• Links to references
• Market research data
• Organizational charts
• Photographs of potential facilities
• Professional licenses pertaining to your legal structure or type of business
• Purchase orders
• Resumes of the founder(s) and key managers
• State and federal identification numbers or codes
• Trademarks or patents’ registrations

Avoid using the appendix section as a place to dump any document or information you feel like adding. Only add documents or information that you support or increase the credibility of your business plan.

Tips and Strategies for Writing a Convincing Business Plan

To achieve a perfect business plan, you need to consider some key tips and strategies. These tips will raise the efficiency of your business plan above average.

1. Know Your Audience

When writing a business plan, you need to know your audience . Business owners write business plans for different reasons. Your business plan has to be specific. For example, you can write business plans to potential investors, banks, and even fellow board members of the company.

The audience you are writing to determines the structure of the business plan. As a business owner, you have to know your audience. Not everyone will be your audience. Knowing your audience will help you to narrow the scope of your business plan.

Consider what your audience wants to see in your projects, the likely questions they might ask, and what interests them.

• A business plan used to address a company's board members will center on its employment schemes, internal affairs, projects, stakeholders, etc.
• A business plan for financial institutions will talk about the size of your market and the chances for you to pay back any loans you demand.
• A business plan for investors will show proof that you can return the investment capital within a specific time. In addition, it discusses your financial projections, tractions, and market size.

2. Get Inspiration from People

Writing a business plan from scratch as an entrepreneur can be daunting. That is why you need the right inspiration to push you to write one. You can gain inspiration from the successful business plans of other businesses. Look at their business plans, the style they use, the structure of the project, etc.

To make your business plan easier to create, search companies related to your business to get an exact copy of what you need to create an effective business plan. You can also make references while citing examples in your business plans.

When drafting your business plan, get as much help from others as you possibly can. By getting inspiration from people, you can create something better than what they have.

3. Avoid Being Over Optimistic

Many business owners make use of strong adjectives to qualify their content. One of the big mistakes entrepreneurs make when preparing a business plan is promising too much.

The use of superlatives and over-optimistic claims can prepare the audience for more than you can offer. In the end, you disappoint the confidence they have in you.

In most cases, the best option is to be realistic with your claims and statistics. Most of the investors can sense a bit of incompetency from the overuse of superlatives. As a new entrepreneur, do not be tempted to over-promise to get the interests of investors.

The concept of entrepreneurship centers on risks, nothing is certain when you make future analyses. What separates the best is the ability to do careful research and work towards achieving that, not promising more than you can achieve.

To make an excellent first impression as an entrepreneur, replace superlatives with compelling data-driven content. In this way, you are more specific than someone promising a huge ROI from an investment.

4. Keep it Simple and Short

When writing business plans, ensure you keep them simple throughout. Irrespective of the purpose of the business plan, your goal is to convince the audience.

One way to achieve this goal is to make them understand your proposal. Therefore, it would be best if you avoid the use of complex grammar to express yourself. It would be a huge turn-off if the people you want to convince are not familiar with your use of words.

Another thing to note is the length of your business plan. It would be best if you made it as brief as possible.

You hardly see investors or agencies that read through an extremely long document. In that case, if your first few pages can’t convince them, then you have lost it. The more pages you write, the higher the chances of you derailing from the essential contents.

To ensure your business plan has a high conversion rate, you need to dispose of every unnecessary information. For example, if you have a strategy that you are not sure of, it would be best to leave it out of the plan.

5. Make an Outline and Follow Through

A perfect business plan must have touched every part needed to convince the audience. Business owners get easily tempted to concentrate more on their products than on other sections. Doing this can be detrimental to the efficiency of the business plan.

For example, imagine you talking about a product but omitting or providing very little information about the target audience. You will leave your clients confused.

To ensure that your business plan communicates your full business model to readers, you have to input all the necessary information in it. One of the best ways to achieve this is to design a structure and stick to it.

This structure is what guides you throughout the writing. To make your work easier, you can assign an estimated word count or page limit to every section to avoid making it too bulky for easy reading. As a guide, the necessary things your business plan must contain are:

• Table of contents
• Introduction
• Product or service description
• Target audience
• Market size
• Competition analysis
• Financial projections

Some specific businesses can include some other essential sections, but these are the key sections that must be in every business plan.

6. Ask a Professional to Proofread

When writing a business plan, you must tie all loose ends to get a perfect result. When you are done with writing, call a professional to go through the document for you. You are bound to make mistakes, and the way to correct them is to get external help.

You should get a professional in your field who can relate to every section of your business plan. It would be easier for the professional to notice the inner flaws in the document than an editor with no knowledge of your business.

In addition to getting a professional to proofread, get an editor to proofread and edit your document. The editor will help you identify grammatical errors, spelling mistakes, and inappropriate writing styles.

Writing a business plan can be daunting, but you can surmount that obstacle and get the best out of it with these tips.

Business Plan Examples and Templates That’ll Save You Tons of Time

1. hubspot's one-page business plan.

The one-page business plan template by HubSpot is the perfect guide for businesses of any size, irrespective of their business strategy. Although the template is condensed into a page, your final business plan should not be a page long! The template is designed to ask helpful questions that can help you develop your business plan.

Hubspot’s one-page business plan template is divided into nine fields:

• Business opportunity
• Company description
• Industry analysis
• Target market
• Implementation timeline
• Marketing plan
• Financial summary
• Funding required

2. Bplan’s Free Business Plan Template

Bplans' free business plan template is investor-approved. It is a rich template used by prestigious educational institutions such as Babson College and Princeton University to teach entrepreneurs how to create a business plan.

The template has six sections: the executive summary, opportunity, execution, company, financial plan, and appendix. There is a step-by-step guide for writing every little detail in the business plan. Follow the instructions each step of the way and you will create a business plan that impresses investors or lenders easily.

3. HubSpot's Downloadable Business Plan Template

HubSpot’s downloadable business plan template is a more comprehensive option compared to the one-page business template by HubSpot. This free and downloadable business plan template is designed for entrepreneurs.

The template is a comprehensive guide and checklist for business owners just starting their businesses. It tells you everything you need to fill in each section of the business plan and how to do it.

There are nine sections in this business plan template: an executive summary, company and business description, product and services line, market analysis, marketing plan, sales plan, legal notes, financial considerations, and appendix.

4. Business Plan by My Own Business Institute

My Own Business Institute (MOBI) which is a part of Santa Clara University's Center for Innovation and Entrepreneurship offers a free business plan template. You can either copy the free business template from the link provided above or download it as a Word document.

The comprehensive template consists of a whopping 15 sections.

• The Business Profile
• The Vision and the People
• Home-Based Business and Freelance Business Opportunities
• Organization
• Licenses and Permits
• Business Insurance
• Communication Tools
• Acquisitions
• Location and Leasing
• Accounting and Cash Flow
• Opening and Marketing
• Managing Employees
• Expanding and Handling Problems

There are lots of helpful tips on how to fill each section in the free business plan template by MOBI.

5. Score's Business Plan Template for Startups

Score is an American nonprofit organization that helps entrepreneurs build successful companies. This business plan template for startups by Score is available for free download. The business plan template asks a whooping 150 generic questions that help entrepreneurs from different fields to set up the perfect business plan.

The business plan template for startups contains clear instructions and worksheets, all you have to do is answer the questions and fill the worksheets.

There are nine sections in the business plan template: executive summary, company description, products and services, marketing plan, operational plan, management and organization, startup expenses and capitalization, financial plan, and appendices.

The ‘refining the plan’ resource contains instructions that help you modify your business plan to suit your specific needs, industry, and target audience. After you have completed Score’s business plan template, you can work with a SCORE mentor for expert advice in business planning.

6. Minimalist Architecture Business Plan Template by Venngage

The minimalist architecture business plan template is a simple template by Venngage that you can customize to suit your business needs .

There are five sections in the template: an executive summary, statement of problem, approach and methodology, qualifications, and schedule and benchmark. The business plan template has instructions that guide users on what to fill in each section.

7. Small Business Administration Free Business Plan Template

The Small Business Administration (SBA) offers two free business plan templates, filled with practical real-life examples that you can model to create your business plan. Both free business plan templates are written by fictional business owners: Rebecca who owns a consulting firm, and Andrew who owns a toy company.

There are five sections in the two SBA’s free business plan templates.

• Executive Summary
• Company Description
• Service Line
• Marketing and Sales

8. The $100 Startup's One-Page Business Plan

The one-page business plan by the $100 startup is a simple business plan template for entrepreneurs who do not want to create a long and complicated plan . You can include more details in the appendices for funders who want more information beyond what you can put in the one-page business plan.

There are five sections in the one-page business plan such as overview, ka-ching, hustling, success, and obstacles or challenges or open questions. You can answer all the questions using one or two sentences.

9. PandaDoc’s Free Business Plan Template

The free business plan template by PandaDoc is a comprehensive 15-page document that describes the information you should include in every section.

There are 11 sections in PandaDoc’s free business plan template.

• Executive summary
• Business description
• Products and services
• Operations plan
• Management organization
• Financial plan
• Conclusion / Call to action
• Confidentiality statement

You have to sign up for its 14-day free trial to access the template. You will find different business plan templates on PandaDoc once you sign up (including templates for general businesses and specific businesses such as bakeries, startups, restaurants, salons, hotels, and coffee shops)

PandaDoc allows you to customize its business plan templates to fit the needs of your business. After editing the template, you can send it to interested parties and track opens and views through PandaDoc.

10. Invoiceberry Templates for Word, Open Office, Excel, or PPT

InvoiceBerry is a U.K based online invoicing and tracking platform that offers free business plan templates in .docx, .odt, .xlsx, and .pptx formats for freelancers and small businesses.

Before you can download the free business plan template, it will ask you to give it your email address. After you complete the little task, it will send the download link to your inbox for you to download. It also provides a business plan checklist in .xlsx file format that ensures you add the right information to the business plan.

Alternatives to the Traditional Business Plan

A business plan is very important in mapping out how one expects their business to grow over a set number of years, particularly when they need external investment in their business. However, many investors do not have the time to watch you present your business plan. It is a long and boring read.

Luckily, there are three alternatives to the traditional business plan (the Business Model Canvas, Lean Canvas, and Startup Pitch Deck). These alternatives are less laborious and easier and quicker to present to investors.

Business Model Canvas (BMC)

The business model canvas is a business tool used to present all the important components of setting up a business, such as customers, route to market, value proposition, and finance in a single sheet. It provides a very focused blueprint that defines your business initially which you can later expand on if needed.

The sheet is divided mainly into company, industry, and consumer models that are interconnected in how they find problems and proffer solutions.

Segments of the Business Model Canvas

The business model canvas was developed by founder Alexander Osterwalder to answer important business questions. It contains nine segments.

• Key Partners: Who will be occupying important executive positions in your business? What do they bring to the table? Will there be a third party involved with the company?
• Key Activities: What important activities will production entail? What activities will be carried out to ensure the smooth running of the company?
• The Product’s Value Propositions: What does your product do? How will it be different from other products?
• Customer Segments: What demography of consumers are you targeting? What are the habits of these consumers? Who are the MVPs of your target consumers?
• Customer Relationships: How will the team support and work with its customer base? How do you intend to build and maintain trust with the customer?
• Key Resources: What type of personnel and tools will be needed? What size of the budget will they need access to?
• Channels: How do you plan to create awareness of your products? How do you intend to transport your product to the customer?
• Cost Structure: What is the estimated cost of production? How much will distribution cost?
• Revenue Streams: For what value are customers willing to pay? How do they prefer to pay for the product? Are there any external revenues attached apart from the main source? How do the revenue streams contribute to the overall revenue?

Lean Canvas

The lean canvas is a problem-oriented alternative to the standard business model canvas. It was proposed by Ash Maurya, creator of Lean Stack as a development of the business model generation. It uses a more problem-focused approach and it majorly targets entrepreneurs and startup businesses.

Lean Canvas uses the same 9 blocks concept as the business model canvas, however, they have been modified slightly to suit the needs and purpose of a small startup. The key partners, key activities, customer relationships, and key resources are replaced by new segments which are:

• Problem: Simple and straightforward number of problems you have identified, ideally three.
• Solution: The solutions to each problem.
• Unfair Advantage: Something you possess that can't be easily bought or replicated.
• Key Metrics: Important numbers that will tell how your business is doing.

Startup Pitch Deck

While the business model canvas compresses into a factual sheet, startup pitch decks expand flamboyantly.

Pitch decks, through slides, convey your business plan, often through graphs and images used to emphasize estimations and observations in your presentation. Entrepreneurs often use pitch decks to fully convince their target audience of their plans before discussing funding arrangements.

Considering the likelihood of it being used in a small time frame, a good startup pitch deck should ideally contain 20 slides or less to have enough time to answer questions from the audience.

Unlike the standard and lean business model canvases, a pitch deck doesn't have a set template on how to present your business plan but there are still important components to it. These components often mirror those of the business model canvas except that they are in slide form and contain more details.

Using Airbnb (one of the most successful start-ups in recent history) for reference, the important components of a good slide are listed below.

• Cover/Introduction Slide: Here, you should include your company's name and mission statement. Your mission statement should be a very catchy tagline. Also, include personal information and contact details to provide an easy link for potential investors.
• Problem Slide: This slide requires you to create a connection with the audience or the investor that you are pitching. For example in their pitch, Airbnb summarized the most important problems it would solve in three brief points – pricing of hotels, disconnection from city culture, and connection problems for local bookings.
• Solution Slide: This slide includes your core value proposition. List simple and direct solutions to the problems you have mentioned
• Customer Analysis: Here you will provide information on the customers you will be offering your service to. The identity of your customers plays an important part in fundraising as well as the long-run viability of the business.
• Market Validation: Use competitive analysis to show numbers that prove the presence of a market for your product, industry behavior in the present and the long run, as well as the percentage of the market you aim to attract. It shows that you understand your competitors and customers and convinces investors of the opportunities presented in the market.
• Business Model: Your business model is the hook of your presentation. It may vary in complexity but it should generally include a pricing system informed by your market analysis. The goal of the slide is to confirm your business model is easy to implement.
• Marketing Strategy: This slide should summarize a few customer acquisition methods that you plan to use to grow the business.
• Competitive Advantage: What this slide will do is provide information on what will set you apart and make you a more attractive option to customers. It could be the possession of technology that is not widely known in the market.
• Team Slide: Here you will give a brief description of your team. Include your key management personnel here and their specific roles in the company. Include their educational background, job history, and skillsets. Also, talk about their accomplishments in their careers so far to build investors' confidence in members of your team.
• Traction Slide: This validates the company’s business model by showing growth through early sales and support. The slide aims to reduce any lingering fears in potential investors by showing realistic periodic milestones and profit margins. It can include current sales, growth, valuable customers, pre-orders, or data from surveys outlining current consumer interest.
• Funding Slide: This slide is popularly referred to as ‘the ask'. Here you will include important details like how much is needed to get your business off the ground and how the funding will be spent to help the company reach its goals.
• Appendix Slides: Your pitch deck appendix should always be included alongside a standard pitch presentation. It consists of additional slides you could not show in the pitch deck but you need to complement your presentation.

It is important to support your calculations with pictorial renditions. Infographics, such as pie charts or bar graphs, will be more effective in presenting the information than just listing numbers. For example, a six-month graph that shows rising profit margins will easily look more impressive than merely writing it.

Lastly, since a pitch deck is primarily used to secure meetings and you may be sharing your pitch with several investors, it is advisable to keep a separate public version that doesn't include financials. Only disclose the one with projections once you have secured a link with an investor.

Advantages of the Business Model Canvas, Lean Canvas, and Startup Pitch Deck over the Traditional Business Plan

• Time-Saving: Writing a detailed traditional business plan could take weeks or months. On the other hand, all three alternatives can be done in a few days or even one night of brainstorming if you have a comprehensive understanding of your business.
• Easier to Understand: Since the information presented is almost entirely factual, it puts focus on what is most important in running the business. They cut away the excess pages of fillers in a traditional business plan and allow investors to see what is driving the business and what is getting in the way.
• Easy to Update: Businesses typically present their business plans to many potential investors before they secure funding. What this means is that you may regularly have to amend your presentation to update statistics or adjust to audience-specific needs. For a traditional business plan, this could mean rewriting a whole section of your plan. For the three alternatives, updating is much easier because they are not voluminous.
• Guide for a More In-depth Business Plan: All three alternatives have the added benefit of being able to double as a sketch of your business plan if the need to create one arises in the future.

Business Plan FAQ

Business plans are important for any entrepreneur who is looking for a framework to run their company over some time or seeking external support. Although they are essential for new businesses, every company should ideally have a business plan to track their growth from time to time.  They can be used by startups seeking investments or loans to convey their business ideas or an employee to convince his boss of the feasibility of starting a new project. They can also be used by companies seeking to recruit high-profile employee targets into key positions or trying to secure partnerships with other firms.

Business plans often vary depending on your target audience, the scope, and the goals for the plan. Startup plans are the most common among the different types of business plans.  A start-up plan is used by a new business to present all the necessary information to help get the business up and running. They are usually used by entrepreneurs who are seeking funding from investors or bank loans. The established company alternative to a start-up plan is a feasibility plan. A feasibility plan is often used by an established company looking for new business opportunities. They are used to show the upsides of creating a new product for a consumer base. Because the audience is usually company people, it requires less company analysis. The third type of business plan is the lean business plan. A lean business plan is a brief, straight-to-the-point breakdown of your ideas and analysis for your business. It does not contain details of your proposal and can be written on one page. Finally, you have the what-if plan. As it implies, a what-if plan is a preparation for the worst-case scenario. You must always be prepared for the possibility of your original plan being rejected. A good what-if plan will serve as a good plan B to the original.

A good business plan has 10 key components. They include an executive plan, product analysis, desired customer base, company analysis, industry analysis, marketing strategy, sales strategy, financial projection, funding, and appendix. Executive Plan Your business should begin with your executive plan. An executive plan will provide early insight into what you are planning to achieve with your business. It should include your mission statement and highlight some of the important points which you will explain later. Product Analysis The next component of your business plan is your product analysis. A key part of this section is explaining the type of item or service you are going to offer as well as the market problems your product will solve. Desired Consumer Base Your product analysis should be supplemented with a detailed breakdown of your desired consumer base. Investors are always interested in knowing the economic power of your market as well as potential MVP customers. Company Analysis The next component of your business plan is your company analysis. Here, you explain how you want to run your business. It will include your operational strategy, an insight into the workforce needed to keep the company running, and important executive positions. It will also provide a calculation of expected operational costs.  Industry Analysis A good business plan should also contain well laid out industry analysis. It is important to convince potential investors you know the companies you will be competing with, as well as your plans to gain an edge on the competition. Marketing Strategy Your business plan should also include your marketing strategy. This is how you intend to spread awareness of your product. It should include a detailed explanation of the company brand as well as your advertising methods. Sales Strategy Your sales strategy comes after the market strategy. Here you give an overview of your company's pricing strategy and how you aim to maximize profits. You can also explain how your prices will adapt to market behaviors. Financial Projection The financial projection is the next component of your business plan. It explains your company's expected running cost and revenue earned during the tenure of the business plan. Financial projection gives a clear idea of how your company will develop in the future. Funding The next component of your business plan is funding. You have to detail how much external investment you need to get your business idea off the ground here. Appendix The last component of your plan is the appendix. This is where you put licenses, graphs, or key information that does not fit in any of the other components.

The business model canvas is a business management tool used to quickly define your business idea and model. It is often used when investors need you to pitch your business idea during a brief window.

A pitch deck is similar to a business model canvas except that it makes use of slides in its presentation. A pitch is not primarily used to secure funding, rather its main purpose is to entice potential investors by selling a very optimistic outlook on the business.

Business plan competitions help you evaluate the strength of your business plan. By participating in business plan competitions, you are improving your experience. The experience provides you with a degree of validation while practicing important skills. The main motivation for entering into the competitions is often to secure funding by finishing in podium positions. There is also the chance that you may catch the eye of a casual observer outside of the competition. These competitions also provide good networking opportunities. You could meet mentors who will take a keen interest in guiding you in your business journey. You also have the opportunity to meet other entrepreneurs whose ideas can complement yours.

Exlore Further

• 12 Key Elements of a Business Plan (Top Components Explained)
• 13 Sources of Business Finance For Companies & Sole Traders
• 5 Common Types of Business Structures (+ Pros & Cons)
• How to Buy a Business in 8 Steps (+ Due Diligence Checklist)

Was This Article Helpful?

Martin luenendonk.

Martin loves entrepreneurship and has helped dozens of entrepreneurs by validating the business idea, finding scalable customer acquisition channels, and building a data-driven organization. During his time working in investment banking, tech startups, and industry-leading companies he gained extensive knowledge in using different software tools to optimize business processes.

This insights and his love for researching SaaS products enables him to provide in-depth, fact-based software reviews to enable software buyers make better decisions.

How to Create a Funding Request

What is a Funding Request?

A funding request is exactly what it sounds like: a written request to obtain funding from an lender or investor for your business. It’s typically included as part of the overall business plan , specifically focusing on the business’s funding needs. Whether you’re seeking capital from a traditional bank, private investor , or angel investor, you should create a funding request. It’s a critical element that increases your chance of getting approved for funding.

What to Include in a Funding Request

So, what should you include your funding request? According to the Small Business Administration (SBA) , a typical funding request should include a few key points of information, starting with your business’s current funding requirement. In other words, how much money do you currently need to operate your business? To calculate your business’s current funding requirements, consider all associated operating costs and revenue.

With that said, you should also include your business’s projected funding requirements over the next five years. As your business grows — and hopefully it does — you’ll probably need additional funding to sustain its growth. By including this information in your funding request, you can secure this capital early so you don’t have to worry about it later down the road.

Other things to include in your business’s funding request is your plan for using the obtained funding (e.g. payroll, merchandise stock, marketing, capital expenditures, working capital, debt retirement, acquisitions, etc.), as well as any strategic situation plans for the near future. This may include company buyouts, acquisitions, debt repayment, or selling your business. As explained by the SBA, this information is highly important to lenders and investors, as it will affect your ability to repay the loan.

Last but note least, be sure to include a time period for your funding request, informing the lender or investor when exactly you need the money and how/when it will be used.

This article brought to you by Intrepid Private Capital�Group – A Global Financial Services Company. For more information on startup and business funding, please visit our website .

You May Also Like

6 Things You Need to Know About Bridge Loans

What Are Warrants in Business Financing and How Do They Work?

Building Business Credit: A Crucial Step for Loan Eligibility and Rates

More from author, + there are no comments, cancel reply.

Save my name, email, and website in this browser for the next time I comment.

This site uses Akismet to reduce spam. Learn how your comment data is processed .

You May Also Like:

Understanding the Risks of Venture Capital Financing for Entrepreneurs

Pros and Cons of an Adjustable-Rate Business Loan

How to Improve Your Business’s Debt-to-Equity Ratio

This device is too small

If you're on a Galaxy Fold, consider unfolding your phone or viewing it in full screen to best optimize your experience.

• Small Business

How to Maximize Your Business Plan to Secure Funding

Updated Aug. 5, 2022 - First published on May 18, 2022

By: Jennifer Post

Writing a business plan for your small business should be one of the first steps you take when a business idea pops into your head. This is how you’ll discover whether your idea can actually be a profitable business. Lenders will want to know the business you plan on starting will make enough money for you to be able to pay back a loan or other forms of investment.

Why is having a business plan important to get funding?

Investors want to invest in a business projected to be profitable within a certain amount of time, has a marketing strategy ready to go, and will exist in a receptive market. All of that information is provided in a business plan. Here are a few reasons why having a business plan is crucial to get funding.

Credibility

Before anyone invests money in your business, lenders will want to know you have a concrete, detailed plan for paying the loan back. Provide information such as:

• Market value of your product or service
• Projected sales in the first year against projected expenses
• Projected profit during your first five years in business

Going through the process of putting all of this together is just another aspect of your credibility as a future business owner, no matter how much money you’re asking for.

Why a Business Credit Card Could Transform Your Small Business

These business credit cards that offer a convenient and efficient way to separate personal and business expenses, simplifying accounting and tax reporting.

Additionally, business cards can provide valuable perks such as rewards points, cashback, and expense tracking tools, enhancing financial management and the potential to help save money in the long run.

You don’t want to earn the reputation of being an ill-prepared entrepreneur. If you take your business idea seriously, show it.

Business need

Just because you’ve thought of a business idea and have outlined every aspect of it doesn’t mean investors and banks will feel the same way. Banks mostly care about whether or not you can pay back a loan, while investors tend to back businesses they connect with.

The need for your business is much more important than it might seem. In order to pay back a loan, your business needs to be profitable. In order for that to happen, you need customers. To get customers, you have to offer something they can’t get anywhere else, whether that’s a product, a service, or an experience.

What should you include in your business plan for funding?

Be detailed and thorough in every idea you present since you’ll most likely have to explain yourself and your business idea. Here’s what should be included in your business plan if you’re seeking funding.

1. Details about your business and company as a whole

It’s important to think about how you plan on setting up your business -- and for more than one reason. Some things to consider:

• Will you be a sole proprietor?
• Do you have a business partner?
• LLC vs. incorporation?

Business structure also matters for paying back a loan. If your business is unable to pay back a loan, the legal structure can be the difference between you having to pay it back somehow (with your home or other assets) or splitting the remaining balance among shareholders or partners.

2. Target market

At the risk of sounding like a broken record, your business can’t make money without customers. Take your business idea and research different locations to find your customers, and ask yourself a few questions:

• Are there a lot of other businesses like yours already out there?
• Are those businesses doing well?
• Is there a gap in what they offer?

You could also pick your target audience first. Let’s say you want young adults between the ages of 25 and 40 to be your main customers. You need to find where those people are and ask the questions noted above. Either way, those questions need to be answered and in a lot of detail.

3. How you plan to make money

This is so much more than just saying, “by selling a lot of product,” or “having a long list of clients.” Anyone can say that. Ask yourself a few questions, just like you did with the market aspect above:

• How much will you charge for your offerings?
• Will people actually pay that amount?
• How much do you need to sell to break even? To make a profit?

Even if your product is worth x amount of dollars in market terms, the harsh reality is it’s only worth what people are actually willing to pay for it. It’s best to underestimate and over-deliver -- as long as your plan still guarantees your ability to pay off a loan.

4. How much funding you’re seeking and its intended use

You need to have a firm grasp on how much funding you need to accomplish your goal, and don’t be shy about it. If you’re seeking a bank loan, it’s a little different because you will qualify for a certain amount based on a number of factors.

Some lenders also have use case limitations, where there are restrictions on what you can use the money for. Consider that, among all of the other qualifications, before deciding if that type of loan is the way you want to go.

If you’re going with an investor, it’s not usually a make-or-break factor to detail what you plan on using the money for, but the more information you provide, the better.

How to write your business plan for funding

Now that you know why a business plan is crucial for funding and what needs to be included in one, let’s get to actually writing it. There are also business plan templates and sample business plans available online that are a good guide to get you started.

Step 1: Write your executive summary

This is generally the first section of your business plan and your first chance to make an impression. As with most introductions, this is where you’ll summarize all the other sections of the business plan, such as your mission statement , general company information, products or services, and financials.

Step 2: Explain your company overview

All that time you spent researching different business formation options will pay off in this section. You’ll explain the structure of your company, exactly what your business does, and the target market you plan on addressing. You’ll want to get into detail about the market you’ve chosen, why you fit into that market, and how you plan on expanding within it.

Step 3: Detail your market analysis

This is the section where you will dive into the nitty-gritty of your intended market. Explain the following aspects:

• What audience lives within that market?
• What do they want?
• How do you plan on providing what they want?
• How much is your product worth?
• What are your plans for growth?
• Are there setbacks you might run into? How will you overcome them?

As anyone who has started a business knows, it’s not all gains. Letting investors know that you recognize there will be obstacles shows that you’ve really thought all of this out.

Step 4: Describe your product/service

In this section, you’ll do more than just explain what you will sell, although that’s part of it. If you’ve invented something or patented something, include that in this section. Don’t only show what you’re offering but explain how it works and how it improves on what’s already out there. If it’s a service, explain how you will produce better results than others.

Additionally, if you have to source materials or equipment from somewhere else, outline whom you will work with and what the process will be to secure those materials.

Step 5: Write out your sales plan

Here are a couple of steps you’ll want to take to outline your sales plan.

• Have some branding ideas on hand: These might include a company name, logo, color scheme, and sample materials, such as business cards or brochures. This will position your product for sale.
• Explain how you’ll market your product: Decide whether you will go with free online marketing, such as social media, or paid marketing, such as online or print ads. While you can choose among options, it will come down to your target audience. Do they spend most of their time online, or do they still read the newspaper every morning? That will determine where you should put your marketing efforts, and since ad return is a business metric you’ll want to track later on, having a solid plan in the initial stages will make that process smoother.

Step 6: Detail and explain your financial projections

This section should come fairly easily once you’ve completed the others. You should have an idea of what it will cost to produce your product or service, how much you can charge for it, your market share, and how you will spend money on marketing.

Do your projections in time increments for the lifecycle of your business , such as the first year, first five years, and looking ahead at 10 years and beyond.

The first couple of years you can be pretty specific about your projections, whereas your long-term projections can be offered up more as goals you would like your company to reach in a certain period of time and how you plan to achieve them.

4 tips for writing effective business plans to secure funding

Now that you have a firm grasp on what needs to be in your business plan, how you obtain that information, and how you actually create a business plan, here are some tips to make sure you’re getting the most out of it.

1. Don’t leave anything out

Leaving bits and pieces of your business up for interpretation or guessing will only hurt your chances of securing funding. If investors are left to fill in the blanks, you have no control over what they fill them with. Make sure you’re as thorough as possible in your research and writing so that nothing is left out.

2. Write with personality

There’s a scene from Parks and Recreation where Tom is presenting a business to a potential investor. His original idea, Tom’s Bistro, is one he’s extremely passionate about. Ben comes in with another idea that has a greater chance of being profitable. Tom starts presenting that and soon finds both he and the investor are bored. As soon as he switches back to Tom’s Bistro, the mood in the room completely changes.

Even though that’s a scene from a television show, it’s a good representation of how adding a little bit of your personality and passion into your business plan can pay off, literally.

3. Don’t speak in general terms

Be as detailed as you possibly can. Use exact numbers, names, dates, etc. Doing this will not only show that you’ve done your homework, but that you’re committed to reaching those numbers by the dates you list.

It can seem daunting to feel like you’re committing to so much, but commitment is what investors are looking for. They need to see that you’re serious about your business, and the amount of detail you include in your business plan will reinforce that.

4. Be upfront about what you’re asking for

Don’t be afraid to ask for the amount you really need, even if it’s high. Being wishy-washy about the number might not present so well. As previously mentioned, bank loans are different in that you only receive an amount you qualify for. If you’re meeting with angel investors , it’s important to go in with a specific number in mind.

While the process doesn’t need to be as dramatic as Shark Tank , expect some back and forth once you present your business plan and offer up how much money you’re asking for.

Final thoughts

A business plan is one of the most important documents you’ll create for your business. It’s where you introduce who you are, what your business is, and how it will be successful. If, as most people do, you’re using your business plan to secure funding, you’ll want to be as detailed and thorough as possible in your research and writing.

You want potential investors to be as serious about your business as you are, so convey to them why you’re serious and how you’re bringing something unique to the table that they would be lucky to be a part of.

Our Research Expert

Jennifer Post writes about marketing and software for small businesses for The Ascent and The Motley Fool.

Share this page

We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent, a Motley Fool service, does not cover all offers on the market. The Ascent has a dedicated team of editors and analysts focused on personal finance, and they follow the same set of publishing standards and editorial integrity while maintaining professional separation from the analysts and editors on other Motley Fool brands.

Related Articles

By: Cole Tretheway | Published on June 7, 2024

By: Lyle Daly | Published on June 5, 2024

By: Christy Bieber | Published on June 5, 2024

By: Lyle Daly | Published on June 4, 2024

The Ascent is a Motley Fool service that rates and reviews essential products for your everyday money matters.

Copyright © 2018 - 2024 The Ascent. All rights reserved.

• Link to facebook
• Link to linkedin
• Link to twitter
• Link to youtube
• Writing Tips

Funding Request Letter Template

4-minute read

• 28th May 2023

Do you need financial backing for a volunteer project or nonprofit organization? If the answer is yes, then you’ll need to a write funding request letter – a formal letter asking for financial support or funding for a specific organization or project.

Since this may be your only form of communication with potential donors, it’s important to get the tone and content right. In this post, we’ll take you through the basics of writing an effective funding request letter – including a customizable sample template.

What Is a Funding Request Letter?

Most nonprofits rely on funding from others to operate, and they often request money from individual donors, companies, or local governments to fund events and projects. To do this, they use funding request letters that outline their objectives and the details of their organization or project.

When writing a letter like this, it’s important to be polite, use a formal, business-like tone of voice , and clearly communicate your goals for the funding.

All letters that request funding should contain the same basic information:

●  Your contact information/the name of your organization.

●  The date.

●  The recipient’s contact information, full name, and title (if applicable).

●  A salutation .

●  An introduction and relevant background information.

●  The funding request, including the exact amount you’re requesting and a breakdown of how the funds will be used.

●  Supporting information, such as the timeline and budget of the project.

●  A closing and signature.

●  Supporting documents.

Let’s look at a sample template.

Find this useful?

Subscribe to our newsletter and get writing tips from our editors straight to your inbox.

[Your Name] [Your Organization’s Name] [Your Address] [City, State ZIP Code] [Date]

[Donor’s Name] [Donor’s Organization’s Name] [Donor’s Address] [City, State ZIP Code]

Dear [Donor’s Name],

I am writing to request funding for [briefly describe the project or initiative for which you are seeking funding]. Our organization has a long-standing history of [briefly describe your organization’s mission and track record of success in achieving its goals].

The project we are proposing is [briefly describe the project, including its goals, expected outcomes, and how it aligns with your organization’s mission]. We believe that this project has the potential to [describe the potential impact of the project and how it will benefit your target population or community].

To achieve these goals, we are seeking a total funding amount of [specify the amount of funding you’re requesting]. This funding will be used to cover [briefly describe the specific expenses that the funding will cover, such as staffing, materials, or other costs].

We have a solid plan for the successful implementation of this project, including [describe the specific steps you will take to ensure that the project is successful, such as project timelines, staffing plans, and quality control measures].

We would be happy to provide additional information about the project or our organization upon your request. We believe that this project has the potential to make a significant impact, and your support would be greatly appreciated.

Thank you for your time and consideration of this matter.

[Your Name] [Organization] [Phone Number]

What to Include in a Funding Request Letter

Always make sure to use the recipient’s full name and title in your salutation; if you’re unsure of the spelling, look it up online (using their LinkedIn profile or company website).

As shown in the sample above, the first two paragraphs should clearly address your reason for writing and provide some background on your organization. This is where you can describe your organization’s history, mission, and previous successful projects or programming.

You can then summarize how you plan to use the requested funds, including the budget for the project and a list of expenses . You should also briefly outline any collaborations or partnerships your organization has formed, a basic timeline for the project, and the expected outcomes or goals.

For your concluding paragraph, reiterate the importance of the project and its potential impact. Thank the donor for their consideration and support and provide contact information for your organization’s staff, including names, phone numbers, and email addresses. Sign off with a respectful salutation using your full name.

Expert Proofreading Services

Whether you’re writing a formal letter, an essay, or a novel, make sure your writing is the best it can be by getting it proofread and edited by our experts. Send in your free sample today!

Share this article:

Post A New Comment

Got content that needs a quick turnaround? Let us polish your work. Explore our editorial business services.

5-minute read

Free Email Newsletter Template (2024)

Promoting a brand means sharing valuable insights to connect more deeply with your audience, and...

6-minute read

How to Write a Nonprofit Grant Proposal

If you’re seeking funding to support your charitable endeavors as a nonprofit organization, you’ll need...

9-minute read

How to Use Infographics to Boost Your Presentation

Is your content getting noticed? Capturing and maintaining an audience’s attention is a challenge when...

8-minute read

Why Interactive PDFs Are Better for Engagement

Are you looking to enhance engagement and captivate your audience through your professional documents? Interactive...

7-minute read

Seven Key Strategies for Voice Search Optimization

Voice search optimization is rapidly shaping the digital landscape, requiring content professionals to adapt their...

Five Creative Ways to Showcase Your Digital Portfolio

Are you a creative freelancer looking to make a lasting impression on potential clients or...

Make sure your writing is the best it can be with our expert English proofreading and editing.

How to Create a Startup Funding Proposal: 8 Samples and Templates to Guide You

Being a founder is difficult. Managing the day-to-day as a founder while trying to secure capital for your business can almost feel impossible. Thankfully, there are different tools and techniques that founders can use to systemize their fundraise to focus on what truly matters, building their business.

One of those tools is a startup funding proposal. In this guide, we’ll break down what a startup funding proposal is and how you can leverage it to build momentum in your fundraise.

What Is a Startup Funding Proposal?

A startup funding proposal is a document that helps startup founders share an overview of their business and make the case for why they should receive funding. A startup funding proposal can be boiled down to help founders layout 3 things:

• What — what does your startup do
• How — how does your startup or product help customers accomplish what they are seeking
• Why — why does your startup need funding and why should an investor fund your business

Related Resource: How to Write a Business Plan For Your Startup

Types of Startup Funding Proposals

Like any business document, there are many ways to approach a startup funding proposal. Ultimately it will come down to pulling the pieces and tactics that work best for your business. Investors are seeing hundreds, if not thousands, of deals a month so it is important to have your assets buttoned up to move quickly and build conviction during a raise. Check out a couple of popular types of funding proposals below:

Traditional Startup Funding Proposal

The most traditional or “standard” standard funding proposal is generally a written and visual document that is created using word processing software and/or design tools.

A traditional proposal is great because it allows you to share context with every aspect of your business. For example, if you include a chart of growth you’ll be able to explicitly write out why that was and what your plan is for future growth.

This document is generally designed to fit your brand and will hit on the key components of your business is structured and predictable way. We hit on what to include in your proposal below.

Startup Funding Proposal Pitch or Presentation

The most common approach we see to a fundraise or proposal is the pitch deck. Pitch decks take the same components as any proposal and fit them into a visual pitch deck that can be easily navigated and understood by a potential investor.

Pitch decks are not required by investors by are generally expected and are a great tool that can help you efficiently close your round. To learn more about building your pitch deck, check out a few of our key resources below:

• Tips for Creating an Investor Pitch Deck
• 18 Pitch Deck Examples for Any Startup
• Our Teaser Pitch Deck Template

1-on-1 Proposals (Elevator Pitch)

A 1 on 1 proposal or an elevator pitch is the quickest version of any proposal. Every founder should have an elevator pitch in their back pocket and is a complementary tool to any of the other funding proposals mentioned here.

As the team at VestBee puts it, “Elevator pitch” or “elevator speech” is a laconic but compelling introduction that can be communicated in the amount of time it takes someone to ride an elevator, usually around 30 seconds. It can serve you for fundraising purposes, personal introduction, or landing a prospective client.”

Email Proposal

Another common way to share a startup funding proposal via email. While the content might be similar to what is seen in a “traditional” funding proposal this allows you to hit investors where they spend their time – their inbox.

The format will follow a traditional proposal with less emphasis on visual aspects and more emphasis on the written content. Check out an example from our Update Template Library below:

Related Resource: How to Write the Perfect Investment Memo

Investor Relationship Hub

Lastly, there is an investor relationship hub or data room that can be used to share your proposal with potential investors. A hub is a great place to curate multiple documents or assets that will be needed during your fundraise. For example, you could share your funding proposal and your financials if they are requested by a potential investor.

Related Resource: What Should be in an Investor Data Room?

What to Include in Your Startup Funding Proposal

How you share your funding proposal might differ but ultimately the components are generally closely related from one proposal to the next. However, be sure that you are building this for your business. There is no prescriptive template that will work for every business.

Project Summary

First things first, you’ll want to start with a summary of your project or your business. This can be a high-level overview of what your proposal encompasses and will give an investor the context they need for the rest of the proposal. A couple of ideas that are worth hitting on:

• What your company does and how it’s different from existing solutions to pressing problems.
• Existing market gaps and how your product covers them.
• The importance of your product in your industry and how it improves the industry.
• Existing resources and manpower, investment requirements, and potential limitations.

Current Performance and Financial Report

Of course, investors want to see how your business has been performing. The data and metrics around your business are generally how an investor builds conviction and further interest in your business. We suggest using your best judgment when it comes to the level of metrics or financials that you’d like to share. A couple examples of what you might share:

• Current assets and liabilities
• MVP presentation for companies still in the ideation stage
• Appendix with financial reports

Related Resource: ​​ Building A Startup Financial Model That Works

Existing Investors and Partners

Inevitably investors will want to know who else you have raised capital from and partnered with in the past. Include a brief description of the different investors you have on your cap table and be ready to field additional questions if they have any.

Pro tip: The first place an investor will go to when performing due diligence is your current investors. Make sure you have a strong relationship and good communication with your current investors.

Market Study and Sales Goals

Investors will also care about your customer acquisition efforts and want to make sure you can repeatably find and close new customers. A couple of things that might be important to include in this section:

• Product pricing and information
• Revenue targets and goals
• Customer acquisition model and efforts
• Sales and marketing related KPIs
• Stories or testimonials from happy customers

Current Valuation, Investment Requirements, and Expected Returns

This is an opportunity to lay out your cap table and explain your current valuation, investment requirements, and what future valuations could look like. As always, we suggest using your best judgment when it comes to what level of detail you’d like to share about your cap table.

Potential Pitfalls and Solutions

There is an inherent risk when investing in any startup. It is important to make sure potential investors are aware of this. Layout the common pitfalls your startup might face and stop you from achieving your goals. Next, lay out the solutions to these problems and how you plan to tackle them if/when they arise.

8 Startup Funding Proposal Samples and Templates

Below are 8 proposal templates to help you kick off your next fundraise. Note that some of these are technically investor updates and not designed for first-time fundraising. Keep in mind that a startup funding proposal could also be utilized for additional funding after the first round of funding.

1. An Investment Summary Template by Underscore VC

Underscore VC is a seed-stage venture fund based out of Boston. As the team at Underscore writes :

“As part of this, we strongly recommend you write out a pitch narrative before you start to build a pitch deck. “Writing the prose forces you to fill in the gaps that can remain if you just put bullets on a slide,” says Lily Lyman, Underscore VC Partner. “It becomes less about how you present, and more about what you present.”

This exercise can help you synthesize your thoughts, smooth transitions, and craft a logical, compelling story. It also helps you include all necessary information and think through your answers to tough questions.

Check out the template here .

2. The Visible “Standard” Investor Update Template

Our Standard investor update template is great for communicating with existing investors. If you are regularly sending Updates to their investors they should know when you are beginning to raise capital again and can almost be treated as an investment proposal.

Check out the template for our standard investor update template here .

3. Sharing a Fundraising Pitch via Video

Videos are a great way to give the right context to the right investors in a concise and quick way. Video is a great supporting tool for any other information or documents you might be sending over. For example, you can include a few charts or metrics and some company information and use the video to further explain the data and growth plans. Check out the template here .

4. Financial Funding Proposal

The team at Revv put together a plug-and-play financial funding proposal. As they wrote, “A funding proposal must provide details of your company’s financials to obtain the right amount of funding. Check out our funding proposal template personalized for your business.” Check out the template here .

5. Investor Proposal Template for SaaS Companies

The team at Revv put together a template to help founders grab the attention of investors. As they wrote, “With so many Investing Agencies, this Investor proposal will surely leave an impact on your company in the long run.” Check out the template here .

6. Startup Funding Proposal Sample

Template.net has created a downloadable funding proposal template that can be edited using any tool. As they wrote, “Get your business idea off the ground by winning investors for your business through this Startup Investment Proposal. Fascinate investors with how you are going to get your business into the spotlight and explain in vivid detail your goals or target for the business.” Check out the template here .

7. Simple Proposal Template

Best Templates has created a generic proposal template that can be molded to fit most use cases. As they wrote, “Use this Simple Proposal Template for any of your proposal needs. This 14-page proposal template is easily editable and fully customizable using any chosen application or program that supports MS Word or Pages file formats.”

8. Sample Investment Proposal for Morgan Stanley

Another example is from the team at Morgan Stanley. The template is commonly used by their team and can be applied to most proposal use cases.

Connect With More Investors and Tell Your Story With Visible

Being able to tie everything together and build a strategy for your fundraise will be an integral part of your fundraising success. Check out how Visible can help you every step of the way below:

Visible Connect — Finding the right investors for your business can be tricky. Using Visible Connect, filter investors by different categories (like stage, check size, geography, focus, and more) to find the right investors for your business. Give it a try here .

Pitch Deck Sharing — Once you’ve built out your target list of investors, you can start sharing your pitch deck with them directly from Visible. You can customize your sharing settings (like email gated, password gated, etc.) and even add your own domain. Give it a try here .

Fundraising CRM — Our Fundraising CRM brings all of your data together. Set up tailored stages , custom fields , take notes, and track activity for different investors to help you build momentum in your raise. We’ll show how each individual investor is engaging with your Updates, Decks, and Dashboards. Give it a try here .

Newly Launched - AI Presentation Maker

Researched by Consultants from Top-Tier Management Companies

AI PPT Maker

Powerpoint Templates

Icon Bundle

Kpi Dashboard

Professional

Business Plans

Swot Analysis

Gantt Chart

Business Proposal

Marketing Plan

Project Management

Business Case

Business Model

Cyber Security

Business PPT

Digital Marketing

Digital Transformation

Human Resources

Product Management

Artificial Intelligence

Company Profile

Acknowledgement PPT

PPT Presentation

Reports Brochures

One Page Pitch

Interview PPT

All Categories

Top 10 Funding Request Templates with Samples and Examples

Nidhi Aswal

Have you ever wondered how businesses streamline their financial requests? Funding request templates are crucial in this process. They provide a structured format for employees to present their funding needs and are essential for ensuring clarity, consistency, and professionalism in financial proposals within an organization.

By using funding request templates, businesses can expedite decision-making processes, improve communication between departments, and maintain a standardized approach to financial requests. It enhances efficiency, minimizes errors, and ensures all necessary information is included in the proposal.

Interested in the most innovative crowdfunding campaigns driving success for diverse projects? Click here to access our Top 5 selections and propel your fundraising goals forward!

Funding Request PPT Templates by SlideTeam function as a valuable resource for crafting striking and informative presentations that bolster funding requests. These templates can enhance the impact of financial proposals, making them more persuasive and engaging for stakeholders.

Get ready to up your game with our Top 10 funding request templates, complete with samples and examples that will have you wow everyone in the boardroom.

Template 1: Cover Letter

This PowerPoint Presentation focuses on a cover letter for a business funding proposal for ABC Corporation Inc. This PPT Deck is a game-changer in your sales and business presentations. This PPT Layout exemplifies professionalism and precision, setting the stage for success. This PPT Preset can revolutionize your pitch decks and reports, enhancing your business acumen. With this template as a prime example, you can elevate your financial requests and make a lasting impression. This PPT Set is your secret weapon in crafting compelling, persuasive presentations that resonate with your audience. 

Download now!  

Template 2: Table of Content

This PowerPoint Slide features a table of contents for a business plan funding request proposal. This PPT Layout is a pivotal tool in your sales and business arsenal. It covers topics, project context, goals & objectives, budget, timeline, roadmap, clients, team, client testimonials, agreement, and more. This PPT Layout is one of the handpicked template collections at SlideTeam to enrich your presentations and propel business expansion. 

Download now!

Template 3: Project Description

This PPT template, centered on project context within a business plan funding request proposal, is a valuable addition to your funding request proposal. It explores crucial project specifics, offering a concise depiction and objective that establish the foundation for success. With a focus on project clarity and purpose, this PPT Slide enables you to create engaging stories that connect with stakeholders. Partner with SlideTeam to develop compelling presentations that leave a lasting impression. Get this PPT Deck today!

Template 4:  Goals and Objectives

This PowerPoint Presentation focuses on goals and objectives for a business plan funding request proposal. This PPT Slide is a strategic asset in your funding request proposal. This PPT Layout hones in on funding proposal goals and objectives, aiming to acquire new clients by showcasing how to accommodate their needs. Let SlideTeam guide you in developing impactful presentations that make a lasting impression. Download this PPT Preset from the link below!

Template 5: Budget

The significance of this particular PowerPoint Template lies in its capacity to streamline the budgeting process for a funding proposal. Designed specifically for business plan funding requests, this PPT Slide offers a structured approach to presenting financial information. This PPT Layout includes a detailed description of expenses and the total budget required. Each item is carefully listed alongside the corresponding amount, with ample space provided for additional textual elaboration. This detailed solution amplifies transparency and encourages well-informed decision-making, paving the way for a smoother progression in obtaining critical funding. Get this PPT Set today!

Template 6: Timeline

Significance of Timeline Template for Business Plan Funding Request Proposal

This Timeline PPT Slide details activities, descriptions, and key dates from start to target. Use this PPT Theme to clearly present the strategic roadmap, enhancing communication and understanding with potential investors. The structured format aids in organizing and visualizing the proposed timeline, fostering a professional and organized image. This PPT slide demonstrates a commitment to transparency and accountability. Its clarity facilitates better understanding and buy-in from potential investors or decision-makers. Get this PPT Layout now that signifies a commitment to professionalism and strategic planning, vital for business success and growth. Download this PPT Set right away! 

Template 7: Roadmap

This Roadmap PPT Template is a vital tool for illustrating the timeline of a business funding proposal. This PPT Theme includes deliverables, phases, and specific durations, providing a clear visual representation of the project's progression. By leveraging this PPT Presentation, businesses can better communicate their project milestones and deadlines to potential investors. The structured PPT Layout facilitates a concise and organized presentation of the funding proposal timeline and showcases a strategic approach to project management. Use this PPT Deck to enhance the impact and credibility of business proposals, increasing the chances of securing funding. Download this PPT Slide right away!

Template 8:  Terms and Agreement

This PowerPoint Presentation is important in outlining the terms and conditions of a business funding proposal. This PPT Slide includes essential aspects such as deadlines, scope of service, privacy policy, payments, service modifications, and termination clauses. This PPT Layout facilitates clarity and precision, ensuring stakeholders grasp the proposed timeline and milestones. The structured format ensures that all key terms are clearly articulated, minimizing misunderstandings and disputes.This PPT Preset serves as a cornerstone for solidifying business relationships and safeguarding interests, enhancing the overall credibility and professionalism of the proposal. Download this PPT Slide right away!

Template 9: Funding Request and Use of Funds

This PPT Template is essential for providing a detailed breakdown of fund allocation within a business proposal. This PPT Layout features a pie chart illustrating the distribution of funds, with 15% allocated to key hires, 65% to marketing efforts, and 20% to product development. Use this PPT Theme to visually communicate the financial strategy to potential investors, highlighting the prioritization of key areas for growth and success. The visual representation enhances the understanding of fund utilization, showcasing a strategic approach to resource allocation. This PPT Slide serves as a persuasive tool for garnering support from potential investors, showcasing a clear roadmap for maximizing the impact of funds injected into the business. Get this PPT Set today! 

Template 10: Funding Request and Use of Funds

Significance of Funding Request and Use of Funds Proposal Template

The significance of this PowerPoint Presentation lies in its capacity to outline a funding request and articulate the planned use of funds. This PPT Deck features two pie charts: one delineating the distribution of spent funds year and month-wise, and the other forecasting expenses totaling $150k. This visual representation offers stakeholders a clear understanding of fund allocation and expenditure projections. By leveraging this PPT Theme, businesses can transparently communicate their financial strategy, instilling confidence and trust in potential investors or partners. This PPT Set serves as a strategic tool for aligning expectations and demonstrating a prudent approach to resource management, enhancing the overall viability and appeal of the proposal. Download this PPT Template right now! 

SlideTeam offers a diverse range of top 10 funding request templates that provide comprehensive and visually appealing solutions for presenting business proposals. These templates, accompanied by samples and examples, empower businesses to communicate their funding needs and strategies to potential investors easily and effectively. Choose from a range of layouts and designs on SlideTeam to ensure a funding request is presented with clarity and professionalism across all aspects. Whether it's showcasing financial data, outlining timelines, or detailing terms and conditions, these templates streamline the presentation process. From comprehensive financial breakdowns to visually compelling charts, each template is designed to impress potential investors and stakeholders. Don't miss out on the opportunity to elevate your funding requests with these powerful tools. Get these premium templates and take the first step toward securing the resources your business needs to thrive. Act now and turn your aspirations into reality!

What’s more?

Curious about the key elements that made Front's Series A Funding pitch a standout for their email startup? Explore the investor presentation that shaped their funding journey! Click here to access it!

Wondering how to make your grant proposals irresistible to funders? Dive into our Top 10 templates with samples and examples for a winning edge in securing funding! Click here to get started!

Related posts:

• How to Design the Perfect Service Launch Presentation [Custom Launch Deck Included]
• Quarterly Business Review Presentation: All the Essential Slides You Need in Your Deck
• [Updated 2023] How to Design The Perfect Product Launch Presentation [Best Templates Included]
• 99% of the Pitches Fail! Find Out What Makes Any Startup a Success

Liked this blog? Please recommend us

Top 10 Product Strategy Roadmap Templates for Success

Top 7 Vertical Flow Chart Templates with Samples and Examples

This form is protected by reCAPTCHA - the Google Privacy Policy and Terms of Service apply.

Grant Proposal Writing

Proposal maker.

Writing a grant proposal can be very time-consuming. It is often considered as an art that, when you attempt to learn it, you have to deal with a lot of time in order for you to master it. You may also see  business proposal examples .

• Training Proposal Examples
• 9+ Multimedia Project Proposal Examples

Most people think that grant proposals are similar to business plans; however, it is not, but it contains similarities such as some of its elements that serve a similar purpose which is to get that money. If you own a business, knowing how to write a grant proposal can definitely help your business organization since it can increase your chances of acquiring and securing the funding for your business. You may also see  service proposal examples .

Grant Proposal Template

• Google Docs

Size: A4, US

Writing the Grant Proposal

Developing a Grant Proposal Example

Restaurant Developing a Grant Proposal Example

Grant Budget Proposal Template

Purpose of a Grant Proposal

A grant proposal is used by entrepreneurs to procure funds for an enterprise.

Every grant proposal would contain a problem statement that will help in persuading the rant reviews into an issuance of funds necessary for any business to run. This problem statement would show the clear and concise objectives of the business as well as address the reasons and the factors why the business needs funding. Additionally, it would dictate every single detail regarding the business and how will the grant be of great help to the business in order to become successful. You may also like  short proposal examples .

An effective grant proposal would mean that the businessmen who created it are also equally effective for having been enabled to use their logical reasoning in informing grant reviewers how much the enterprise or the business needs funding. You may also check out  research proposal examples .

Basic Elements of Grant Writing

Size: 74 KB

Examples of Strong Small Grants Proposal

Size: 254 KB

Size: 154 KB

Grant Proposal Writing Template

Size: 83 KB

Tips for Writing Successful Grant Proposals

Here are some tips you might want to follow should you want to create a successful grant proposal:

Become a grant proposal reader

Even if this is not an act of writing, you will become an excellent grant writer if you have read a lot of grant proposal. Just like how authors are wide and wild readers before getting to write their own books, being a grant proposal reader first will enable you to become an excellent grant proposal writer. You may also see  investment proposal examples .

You may also join organizations that will help you become a grant reader as well as a grant writer. This will enable you the other grant proposals of others and you will also be able to know and understand how the process of grant proposal writing would work. You may also like  freelance proposal examples .

Researching about the organization

You have to make sure that you will be able to research the organization you are asking for a grant from. There are grant-giving organizations that have a lot of useful information either on their newsletters or on their websites. If you are stuck not knowing what to write in your grant proposal, you may refer to these and make use of their useful information that can be found there. You may also check out  budget proposal examples .

You can even print out their information and take note of the important details such as their vision or mission statements as these could help you in making sure that whatever you write in your grant proposal are aligned to their mission and vision statements. Some organizations might have their own rules or restrictions and you should make sure that you will also be able to take note of these as you write your grant proposal. You may also like  sponsorship proposal examples .

Fit your project goals with the potential grantor’s vision

Knowing the main goal of your project will enable you to tailor it to the organization you will propose to. You do not have to stretch your project idea into something that does not anymore stay true to your project goals. You just have to make sure that you are going to look for a possible grantor with a vision that fits yours. Doing this will enable you to be at least assured that you are going to get your grant proposal approved and signed by the grantor you are eyeing on.

Follow all grant instructions to the grant proposal

Have you ever heard of someone so intelligent but still failed the exam because he or she did not follow the instructions? This could happen to you when writing a grant proposal. Even before your potential grantor would reach the last lines of your grant proposal, he or she will already put your grant proposal down especially if your noncompliance to the instructions is glaring. Make sure you would take note of all the grant instructions and double-check your grant proposal if it follows every single instruction. You may also check out  the conference proposal examples .

Sample Grant Proposal

Size: 206 KB

Sample Successful Grant Writing

Size: 118 KB

Simple Sample Grant Proposal

Size: 128 KB

Successful Grant Proposal Writing Example

Size: 116 KB

Do not hesitate to dream big

Since you have already mustered up the courage to ask for a grant, might as well go big rather than go home. Do not hesitate and keep on being shy when it comes to seeking for the approval of your grant proposal. For example, if you would ask for $1,000 for a big project, you will only get that, and worse, you might even get less or half of it! But try asking for $1,500 and you might possibly get maybe around $1,000–$1,250. Do this without having to compromise the instructions that you have to follow. You might be interested in learning  how to write a proposal .

Show the grantor that you deserve the grant approval

To prove to the potential grantor that you deserve the approval of the grant, you have to show to the grantor that you are already doing something that makes you deserving enough to get the grant approval. They are going to shell out their money for you, make sure that you are worth it and that you will not use it for useless and pointless endeavors. A potential grantor might want to see whether you already had something that is in place. You may also like  short proposal examples .

It is even suggested that you prove to a potential grantor that you have already accomplished worthwhile projects effectively without a lot of funds. When they know of this, they might wonder,  “How much can he or she do if he or she already has funds?”  They will then be encouraged to support you in your endeavors and help you achieve bigger and better projects. You may also see  fundraising proposal examples .

Never ever complain and get discouraged

The challenge does not stop in writing a grant proposal because this is just actually the start. Do not complain if your grant will not get approved and signed. Do not complain if you will experience more difficulties and hardships along the way. Do not complain that the project you are planning to have is seemingly hopeless. Do not complain because this is how you will learn so that the next time, you would know what to do, enhance, or improve. You may also see  investment proposal examples .

Do not get discouraged and just keep trying and trying. Do not get discouraged and always try to see the positive side of all the challenges that come and go in your life. Who knows? This might get noticed by a potential grantor and your grant proposal might be approved and signed because of this. You may also want to know  how to write a successful thesis proposal .

Proofread more than once

When writing a grant proposal, the last thing you would not dare forget is to proofread your grant proposal more than once—yes, even if you think that what you have written is already the “final one” or the “right one.” You may also want to get more proposal examples.

When proofreading, make sure that you check the following:

• Use of punctuation marks
• Use of technical terms
• Compliance with the grantor’s instructions

When you produce an almost-perfect and error-free grant proposal, it will prove to your grantors that you are not treating grant proposal lightly and for granted. It would also show that you respect the readers of your grant proposal. It is possible that your grant proposal would not be approved and signed just because of the fact that you have not thoroughly and properly proofread your grant proposal before sending. You might want to read and know more about real estate investment proposal examples .

Text prompt

• Instructive
• Professional

Generate a proposal for a new school recycling program

Compose a proposal for a school field trip to a science museum.

• Skip to navigation
• Skip to main content

Disability and Carers

The NDIS Amendment Bill - questions and answers

Ndis reform: video interviews with minister shorten.

• Sustainability and Introduction
• Reform and registration
• Reform and housing

General questions

What is the purpose of these changes, how will people with disability be affected by these changes, why is this legislative change needed, why do we need a definition of ndis support, where does the constitutional basis for the ndis come from now, does the definition of ndis support limit the kinds of supports the ndis will fund.

• Are changes being made to choice and control?

What immediate impacts will there be for participants?

Can a participant only receive funding for impairments that meet the access requirements, can i spend my ndis budget on my impairments that don’t meet the access criteria, does this bill prevent the government from enacting a medical model or parenting model, where the person with a disability is in charge of their life and has choice and control, some sections appear to limit the lengths of plans – can you explain about intervals of funding, how will the ndia support participants to better manage their plan funding to avoid overspends, noting providers play a role here too, what reforms are happening at the ndia, what can be done to improve ndis services in areas with limited access to services, like regional communities, what is being done to make it easier to contact the ndia, some people with disability don't know they can choose their support services. what is the ndis doing to help educate them, people in remote aboriginal communities are finding it hard to get ndis services. how will the ndis make sure they are included, why are there delays in ndis approvals for equipment and prosthetics, and how can providers and participants get faster approvals, how will the ndis reforms help participants in emergency situations to make sure they don't fall through the cracks, amendments added to the bill, what is the ndis supports substitution process, what is an impairment notice.

• What additional functions were given to the NDIA?
• What is the Claims and Payments Framework?
• Will I have to make a claim within a certain timeframe?

I am worried about the talk of debts being raised, what are you doing to make sure it’s not another Robodebt?

Why are you allowing first ministers to agree to ndis rules, how does the bill make sure you consult better next time, what are the new information gathering powers, and what safety measures have been put in place, how does the bill make sure the needs assessment report will contain all relevant and appropriate information about a participant and their disability, what agreement did the government reach with the states and territories to ensure that they continue to play their critical co-governance role, while also ensuring that critical rules can be made in a timely and efficient manner, changes to definition of ndis support, proposed new definition of ndis support in the national disability insurance scheme amendment (getting the ndis back on track no. 1) bill 2024, what is the new definition of ndis support, why wasn’t this done from the beginning, how does section 10 work now what are the other implications of the proposed amendment, needs assessment, can a participant seek a review of a needs assessment or request a new one, will a participant get to see their needs assessment, how will people with disability with complex or invisible disabilities be confident that the ‘needs assessment’ will accurately capture their impairments, rules and legislative instruments, why is the needs assessment going to be in a ministerial legislative instrument and not rules what are the safeguards, does the bill make changes to eligibility, will the proposed rules be safeguarded from future changes by successive governments that could result in the ndis becoming more restrictive and without codesign input, regarding the requirement in legislation to provide needs assessment to the ceo and not to the participant or their family. recovery good practice would always share. will there be sharing of draft assessment reports with the subject of the report, does the act still define who is eligible for the ndis, will everyone who currently has a personal ndis plan be reassessed for eligibility how will this work, new ceo powers, information gathering powers for eligibility assessments, powers to switch plan management, what safeguards will be in place to protect the ndis and the disability community from the minister or ceo potentially abusing the proposed powers introduced in the bill, new planning framework, what is the new planning framework, what happens if i spend all of my budget before my plan ends, does this mean my plan funding will be cut, are there changes to review rights under the new planning framework, is there a timeline for implementing the ndis review recommendations.

• Will this legislation make the NDIS more sustainable?

Why is the Government making changes now?

How can the legislation be supported without knowing what the rules will be when will we see the proposed rules and operational guidelines, consultation/co-design, what measures are you taking ensure people can participate in consultations on reforms in an accessible way, what consultation has occurred and with who, why was there no public consultation on an exposure draft of this bill, will changes to the ndis be co-designed with the disability community when will this commence and who will be involved, how can i keep up to date with this bill, what measures are you taking ensure people can participate in consultations on rules in an accessible way, some people with a psychological disability feel that they were not heard as part of the ndis review, how can you assure that we will be heard through these changes, how will first nations people be involved in this process, how will engagement work in regional, rural, and remote areas will we also have the ability to engage in person, what will consultation look like on legislative instruments, the ndis review, does this bill mean the government has agreed to the recommendations of the ndis review.

• When will other NDIS Review recommendations (not addressed in this Bill) be pursued?

What will be included as part of the second bill?

The government has not formally responded to the recommendations of the ndis review (or drc) how do you know that this is the way forward, children and families, i am the parent of a 5-year-old child with developmental delay who is in the ndis. do the changes in this bill mean my child will no longer receive support from the scheme, what will the new early intervention pathway for children with high support needs look like, how will the government ensure that support workers are trained, qualified, and checked for child-safety, psychosocial.

• How will the changes affect people with psychosocial disability’s access to the NDIS?

Regarding section 27 changes, how does this build an early intervention pathway for psychosocial participants?

What protections are there to ensure mental health participants are not adversely affected by any changes, explanatory memorandum uses mention of alternative commissioning – is this possible for psychosocial supports, how will it be ensured that any changes do not disproportionately affect the mental health community, what will be the impact of provider registration for psychosocial services, will existing participants be removed from the ndis under the new changes and will there be extra support in the period immediately after this, will children still be able to get behaviour support services getting support early is important to prevent restrictions when children become adults. this aligns with the recommendations from the royal commission into violence, abuse, neglect and exploitation of people with disability., foundational supports.

• When will foundational supports be implemented?

How can the disability sector be involved in designing foundational supports for the NDIS?

Quality and safeguards, what will the ndis commission do with its additional compliance powers, what do the changes about quality auditors mean.

• Why increase the number of Commission officers with compliance powers?

How will foundational supports for children work? Home-schooled students and students in isolated areas have not been factored into the foundational supports recommendations. How will they be supported?

How will the blending of education and removal of “special needs schools” to stop a segregated system work, how will eligibility be satisfied for foundational supports and how would this be different to ndis eligibility based on permanency and functional impact of disability, will there be formal arrangements between state and territory governments to guarantee the delivery of foundational supports, there is confusion around section 10 of what is and isn’t a ndis support – particularly in the mental health area round rehabilitation. what is the difference between that and recovery support, why is the government making all providers register, we have heard the minister talking about fraud and pricing – why hasn’t this been included in the proposed bill, other matters.

• create the scaffolding to progress key NDIS Review recommendations. Government will do this with people with disability and the disability community. 
• clarify the intention of existing legislation. This will improve the delivery of the Scheme now. 
• The changes address some of the key recommendations from the 2023 independent review of the NDIS. 
• make the NDIS more about people 
• ensure every NDIS dollar gets to those who the Scheme was created for. 
• The new Rules will be implemented in stages. This will happen while other key reforms, like the development and implementation of foundational supports, are made.
• The legislative changes will ensure a better experience for all Australians with disability, their families and carers.
• whether they are eligible for the NDIS
• if they are better supported by another system.
• people with psychosocial disability
• children under 9 years old who have developmental delay or disability.
• The changes will also create the basis for a new way of setting budgets. This will give participants greater flexibility and clarity around their funding and how they can use it.
• Many of the ways the Scheme works are embedded in law. These are called NDIS legislation and Rules.
• The legislation needs to be changed to enable some of the improvements proposed by the NDIS Review.
• We also need changes to the legislation to allow Government to make new Rules. We need these new Rules to change how the Scheme operates. 
• The goal is to make better decisions that are fair, transparent and consistent.
• It makes clear the constitutional basis for the new budget setting framework recommended by the NDIS Review, and helps to clarify and identify the constitutional basis of the NDIS as a whole
• Assist participants and the disability community to understand what is (and always has been) capable of being funded by the NDIS having regard to intergovernmental agreements and constitutional considerations.
• For the sake of consistency and simplicity across the entirety of the NDIS Act, the definition has been adopted in key areas, particularly where references to supports being appropriately funded by the NDIS already exist. 
• As amended, the NDIS Act will continue to be supported by the same heads of Commonwealth constitutional power that currently support the Act. 
• To a large extent, constitutional support for the NDIS comes – and will continue to come – from the external affairs power in the Constitution as a mechanism to implement the CRPD. The Act also derives support from the ‘sickness benefits’ aspects of the social welfare power in s 51(xxiiiA).
• Currently, supports funded by the NDIS must be ‘reasonable and necessary’ for the participant, having regard to the matters set out in section 34 of the NDIS Act. 
• Although the National Disability Insurance Agency (NDIA) provides choice and control by describing supports generally in participant plans, this does not provide complete autonomy over spending.  The current terms of the NDIS Act – including the s 34 ‘reasonable and necessary’ test –operate in such a way that only constitutionally valid supports and services may be provided or obtained under the NDIS. 
• Moving forward, participants will no longer receive funding in relation to specific reasonable and necessary supports, but rather will receive a flexible budget (along with a limited number of specifically identified supports that will be stated in their plan). This means it is necessary to introduce a concept of ‘NDIS supports’ to provide clarity to participants about what supports are able to be funded through the NDIS.
• The original intention of the NDIS was to provide particular kinds of supports (‘reasonable and necessary supports’) to people with disability. This continues with the definition of NDIS supports. 
• By inserting a definition of ‘NDIS support’, the Bill does not tighten the kinds of supports the NDIS will fund. Instead the Bill clarifies the supports that have always been available under the NDIS to ensure certainty for participants now and into the future.  
• This definition will include all supports capable of being funded by the NDIS, but some things will only be an NDIS support for a participant if they have a need for that support as a result of their disability. For example, a participant who does not have any hearing loss will have no need for a hearing aid, meaning a hearing aid would not be an NDIS support for that participant. A hearing aid could, however, be an NDIS support for a participant who is living with hearing loss or deafness.

Are changes being made to choice and control?  

• Choice and control is one of the founding principles of the NDIS. That won’t change. It puts participants at the centre of decision-making about their needs and supports. None of the changes in this Bill will change this fundamental principle. 
• Changes to the NDIS legislation and Rules will make things more transparent. They will help participants make better decisions. 
• greater flexibility about how they use their NDIS funding to meet their disability-related support needs.
• better support aligned to the reason they entered the Scheme.
• Changes to Rules will ensure participants have greater certainty when engaging with the NDIA. 
• Participants will have more choice and control of their supports with a flexible budget. This aims to lead to higher rates of social and economic participation for people with disability in their communities.  
• Many changes in this Bill rely on further Rules being made and/or Ministerial determinations. A Ministerial determination is like a Rule. We will consult with states and territories on Ministerial determinations. The Rules and Ministerial determinations will be developed over time with the disability community. The legislation that is dependent on Ministerial determinations or Rules will have no immediate impact for participants. 
• that the NDIA will have to tell participants if they have met access to the Scheme based on the disability or early intervention requirements, or both. This is important for when the early intervention pathway is developed; 
• what disability-related supports participants can use their NDIS funding for, as set out in the current NDIS Rules and the Applied Principles and Tables of Support (APTOS). This is an agreement between states and territories and the NDIA about responsibilities;
• participants need to provide information to the NDIA, if asked, as part of an eligibility reassessment process;
• NDIS supports in a plan relate to the impairment(s) that meet the access requirements;
• that plan management types can be changed where there is financial risk to the participant, or the plan nominee, child representative or plan manager has not spent NDIS amounts on ‘NDIS supports’; and 
• there is a strengthened obligation for participants to remain within their funding limit. This change will only come into effect when a ministerial determination is made. 
• These changes mean participants will receive the right services from the right service system.  
• The quality and safety improvements will also commence immediately (28 days from Royal Assent). This will make it easier for the Commission to use its compliance and enforcement powers under the Act.
• The amount of funding a participant receives under their plan is not linked to the access decision. Funding depends on the participant’s impairments that meet the requirements of section 24 and/or section 25 at the time of the planning decision. This ensures that funding meets the participant’s disability needs at the time of the planning decision.
• The introduction of a flexible budget will allow greater flexibility in how participants can spend their budget. 
• People with disability know their own support needs best, so in line with the NDIS Review, flexible funding may be used for any NDIS supports that meet a participant’s support needs.
• This means that a participant may use flexible funds for a range of supports they need as a result of their impairment/s, provided those supports are appropriately funded by the NDIS. 
• Participants will no longer be constrained by line-by-line plans that specify particular supports and support intensity. 
• People with disability know their own support needs best, so flexible funding may be used for any NDIS supports that the participant requires as a result of their disability. 
• This means that a participant may use flexible funds for a range of supports that they need as a result of their impairment/s, provided those supports are appropriately funded by the NDIS. 
• Participants will no longer be constrained by line-by-line plans that specify particular supports and support intensity.
• This Bill does not make any changes to the objects and principles in the Act. Supporting the independence and social and economic participation of people with disability as well as enabling people with disability to exercise choice and control in the pursuit of their goals and the planning and delivery of their supports remain key objects of the Act.
• Under the proposed Bill it suggests introducing funding periods, that would enable participants to receive funding in manageable intervals rather than all at once. For example, a participant with a five-year plan may have funding allocated in yearly periods, allowing for better budget management. This approach would enable the participant have clear guidance on their funding allocation over each period, providing effective financial management and still supporting flexibility in how they access support services.
• Priority changes to planning include the introduction of new provisions to create the construct of a whole-of-person budget. 
• These changes are intended to provide participants with greater choice and control about how they use their NDIS funding to meet their disability-related support needs. The goal of the new budget settings is to provide participants with a more dignified, person-centred assessment and budget setting experience.
• These provisions will allow a flexible budget to operate alongside a stated supports budget, to be defined and set out in Rules. 
• The NDIA has been working with participant reference groups to understand how it can best support participants to manage funding.
• Future changes will set out the process by which the budget is determined, and when supports can be stated (as non-flexible items) in plans. 
• New Rules will specify what flexible budgets can and cannot be spent on, providing transparency for participants, and greater clarity about NDIS funds can be used.

The Government has been making changes at the NDIA, including to its leadership, and employing more staff.  In the 2023-24 Budget, the Federal Government announced it was investing more than $720 million in the NDIA. This money has gone towards the Agency’s ‘Reform for Outcomes’ program, designed to deliver better outcomes for people with disability and help secure the ongoing sustainability of the Scheme.

This work is underway, and includes boosting staff numbers, uplifting systems to be able to better detect and catch anyone looking to exploit the Scheme for their benefit, as well as improving efficiency and the planning process for those who rely on it. 

• The Government knows that different approaches to the NDIS are needed to ensure people in regional areas can still access services. 
• The Government is looking at "direct commissioning" to use NDIS funding in areas with few providers. The Government would like to work more with local partners to make this happen.
• The NDIA is working to ensure that when you call the National Contact Centre, the first person you speak to should be able to assist you straight away. This may not always be possible for more complex issues.
• The Agency continues to recruit more National Contact Centre staff to meet the demands of the Scheme’s continued growth.
• Anyone wishing to contact the NDIA can call 1800 800 110. More info is available on the NDIS website .
• The NDIS is a world-first Scheme that  gives people with disability choice and control in how they are supported, and by whom.
• Early Childhood (EC) partners and Local Area Coordinators (LACs) play a key role in supporting NDIS participants and their network to understand how they can best make their NDIS plan work for them.
• In some circumstances, where a participant may need further support to understand how to use their NDIS plan, the NDIA may include funding for a support coordinator – whose role is to help a participant use their plan.
• More information on using your plan is available on the NDIS website .
• The NDIA recognises the challenges facing many Australians, particularly First Nations peoples, living in more remote parts of Australia to access the NDIS.
• The National Disability Insurance Agency (NDIA) is partnering with the First Peoples Disability Network (FPDN) to co-design a new First Nations Strategy and action plan.
• The NDIA has appointed a Deputy CEO, First Nations, in recognition of the work needed to ensure First Nations people living with disability have access to the disability support they need. 
• A key part of this role is to lead Agency work to improve access and outcomes for First Nations people with disability.
• Since late 2023, the NDIA has received a larger volume of request from participants asking for a change to their NDIS plan.
• This has resulted in some delays to the decision-making process.
• The NDIA is aware that some participants are experiencing delays in decisions for requested supports, including Assistive Technology (AT). The NDIA continues to examine its processes to reduce these delays, including how we handle AT requests via our systems.
• The NDIA is working hard to resolve delays experienced by participants and apologises to anyone impacted. 
• An action plan has been implemented to ensure highest priority requests are considered with urgency, reduce overall wait times and ensure participant risk is addressed.
• The NDIA is prioritising urgent requests and older requests, and is working hard to reduce the delays to ensure participants are able to access their disability-related needs in a timely manner.
• The NDIA has recently formed a dedicated Crisis Coordination and Continuity (CCC) Branch to recognise the important role it plays in ensuring participants are safe and supported.
• The Agency continues to work with emergency services organisations to put in place measures appropriate to the size and complexity of the emergency.
• The recently formed CCC Branch will grow the NDIA’s capability to prepare for and respond to emergency events. 
• The branch takes a participant-centred approach, working closely with participants to co-design emergency preparedness.

What changes were made to the Bill?

• The substitutions process, allows a participant to seek to ‘substitute’ a support that has been listed as not an NDIS support for one that is. This amendment responds to community feedback and concerns about the supports that will be listed in rules as not NDIS supports.
• In practice, if a participant considers an item that is excluded from being an NDIS support would be more beneficial for them than an alternate support that is not excluded, then the participant may make an application to substitute that support.
• The substituted support must replace one or more supports that are NDIS supports. The substituted support must also be something that still falls within the broader definition of NDIS support and is appropriately funded by the NDIS.
• This will ensure there is some flexibility for participants who have unique disability support needs, while maintaining the original intention of section 10 (which is to provide clear boundaries of supports the NDIS can and cannot fund).
• Participants’ impairments should be clearly identified and communicated to a participant as part of access and planning.
• From 1 January 2025 all new participants will receive an impairment notice when they access the Scheme.
• The notice will set out the kind of impairments a participant has, rather than focus on diagnoses. This process recognises people with disability who have the same ‘diagnoses’ may have significantly different impairments and support needs.
• Participants will be able to request a variation of this notice to add or remove impairments. A decision not to vary a notice will be subject to internal and external merits review. This will address concerns raised about a participant’s lack of visibility of impairments the Agency considers meet the disability or early intervention requirements, noting it is only these impairments which will be used to determine a participant’s NDIS funding.
• The Minister will make an instrument determining the circumstances in which an impairments notice may be provided to a participant. This reflects the fact that the NDIA cannot issue notices to all of the over 660,000 current participants in the Scheme.

What additional functions were given to the NDIA?

• Integrity is not currently an actual function of the Agency. This creates a level of uncertainty about the extent of the Agency’s responsibilities in relation to protecting the Scheme from fraud and non-compliance that results in misuse of NDIS funds.
• To combat significant concerns about the impact of abuses and fraud on the Scheme, the Australian Government is formalising the Agency’s role to address risks around fraud, misuse and abuse in relation to NDIS funds.
• The Agency will have a new explicit function of preventing, detecting, investigating and responding to behaviour which threatens the integrity of the Scheme. This will provide a clear statutory basis for the establishment of processes and procedures to control and protect participants against integrity risks.
• This supports and complements the Australian Government’s continued investment in strengthening the Scheme through measures such as the Crack Down on Fraud Program and the Fraud Fusion Taskforce.

What is the Claims and Payments Framework, and why do we need it?

• The NDIS Act does not currently have a legislated claims and payments framework which is highly unusual across agencies responsible for administering significant payments and means it has been unclear for people, including participants and providers, how ‘claims’ should be made and how and when the Agency must ‘pay’ relevant amounts.
• The Agency processes approximately 400,000 claims per day. Many of these claims contain very limited information to identify whether the claim is appropriate to be paid under the Scheme.
• New section 45A outlines the mechanical requirements for a claim. For a claim to be payable, it must be made by the person managing funding under a plan, be made in the approved form, and contain all required information.
• The Agency will work with the disability community to design the payment form to ensure it is accessible and meets the needs of different participants and their plan management arrangements.

Claiming timeframes

• The Bill now requires claims must be made within two years of the support being provided which is the same as payments made under Medicare. This applies to claims made on or after commencement of the Bill.
• This is important for Scheme quality and integrity now and into the future but there will be a 12 month ‘grace period’ following commencement of the Bill during which no time limit on claims will apply. This allows participants and providers a period of 12 months to gather necessary information and submit any outstanding claims for supports obtained or provided more than 2 years in the past.
• Although the Bill does not make any changes to the debt provisions of the NDIS Act, there have been many concerns about the raising and waiver of debts under the NDIS Act.
• The Bill now replaces the existing ‘special circumstances’ debt waiver provision in the NDIS Act to expand the circumstances in which a debt can be waived.
• Special circumstances may include things such as where a debt has been raised as a result of the abuse, exploitation or coercion of a participant.
• The CEO will also be able to consider the participant’s disability as part of a holistic assessment of their circumstances, which will inform the assessment of whether there are special circumstances that make waiver of the debt appropriate.
• Currently, only state and territory Disability Ministers can agree to the rules. Now, both Disability Ministers and First Ministers can agree. This helps them talk about and decide on rules in meetings like the National Cabinet.
• The Community Affairs Legislation Committee recommended (recommendation 2) that a ‘consultation statement’ be tabled along with all legislative instruments made under the NDIS Act that sets out consultations undertaken. The proposed amendment requires the following information about consultation to be included in explanatory statements to all legislative instruments made under the NDIS Act:
• describe the nature of the consultation 
• describe in general terms the persons, bodies or organisations who were consulted 
• contain a summary of the views expressed by those persons, bodies or organisations.
• Recommendation 3 made by the Community Affairs Legislation Committee was that Government further clarify the circumstances under which some additional information gathering powers granted to the CEO of the National Disability Insurance Agency will be used.
• Although requests for information from participants and other people under the NDIS Act are generally given in writing, the amendment clarifies that fact, and ensures the CEO has the power to explicitly vary or revoke their request at any time after it has been made. For example, a request for information may be withdrawn because information has been obtained elsewhere, is no longer required or because it is reasonable for the relevant person not to provide the information.
• It is important to note that if written communication is not the most suitable method of communicating with a participant, they will also be given the request in their preferred manner of communication.
• These amendments also provide guidance to the CEO in considering whether or not it is reasonable for a person not to have complied with certain requests for information within the timeframe prescribed in that request for example, whether the failure to comply with the request was beyond the control of the participant.
• The Bill introduces a new planning framework, which will be based on a needs assessment conducted under proposed new section 32L. The needs assessment will result in an assessment report, with the information in this report being used to calculate a participant’s reasonable and necessary budget and factored into a method determined under proposed new section 32K.
• While the Committee did not make a specific recommendation around this issue, it acknowledged that it had received significant evidence in relation to the provisions on the support needs assessment in new section 32L. Much of this evidence focused on concerns about whether the needs assessment is a ‘whole of person’ assessment which assesses all of a participant’s disability related support needs (whether or not those will be met by the NDIS).
• The intent of section 32L has always been that a needs assessment will assess a person holistically, looking at all of their disability related support needs, consistent with recommendations of the 2023 Independent Review into the National Disability Insurance Scheme (NDIS Review). While the assessment itself is holistic, funding for supports under the NDIS can only be provided in relation to impairments that meet the disability or early intervention requirements. This approach is consistent with the original intention of the NDIS, to provide disability supports to Australians with permanent and significant disability as part of a broader system of available supports and is consistent with recommendations of the NDIS Review. It makes it clear the method for calculating a participant’s reasonable and necessary budget should recognise that a range of factors may impact a participant’s support needs.
• The proposed amendments also make changes around the ministerial determination that prescribes the method for determining a participant’s reasonable and necessary. The amendments require the Minister to be satisfied that the determination adequately takes into account the variety of factors may affect a participant’s need for NDIS supports.
• These amendments clarify that a needs assessment will be undertaken on a whole person basis by assessing all of a person’s disability support needs. Other information to be included in the needs assessment report will be outlined in a legislative instrument that will be the subject of consultation and co-design. This will ensure that the needs assessment report contains all relevant and appropriate information about a participant and their disability.
• Ministerial determination made under section 33 that deals with total funding amounts and funding periods in old framework plans
• Transitional rules
• Rules relating to new impairment notices, which will be Category D rules.
• Second , there will be a new more confined process for seeking agreement to Category A rules, with specific parameters around the kinds of objections that States and Territories may rase to the content of rules. Instead of the current 90 day timeframe that for States and Territories to provide agreement, each jurisdiction will have 14 days to ‘disagree’ to rules. This disagreement must be based on the objects and principles of the Act.
• If agreement cannot be reached with all states and territories, a new dispute resolution process will allow for referral to the Prime Minister and direct engagement with First Ministers. If unanimous agreement can still not be reached, only majority agreement is required before the rules can be made.
• Third , there is a truncated process for agreeing to certain amendments to the rules setting out the Needs Assessment and Budget Tool. If the amendments will have no substantial policy or financial implications for the NDIS, agreement from States and Territories is not necessary. They will still have the ability to object if they consider that the amendments will have substantial policy or financial implications.
• subsection 32B(1) – Determining participants that are to have new framework plans
• subparagraph 32C(c)(ii) – Adjusting the date by which full transition to new framework plans must occur
• subsection 32E(4) – Prescribing kinds of supports that must be ‘stated supports’ under new framework plans
• subsection 32K(1) – Setting out the method for working out total funding amounts
• subsection 32L(2) – Setting out the support needs assessment tool or tools
• subsection 32L(6) – Prescribing what must be included in a support needs assessment report 
• subsection 32L(7A) – Parameters around when a replacement support needs assessment will be undertaken.

The Government has heard feedback about the proposed new definition of NDIS Supports in the Bill and is proposing to introduce parliamentary amendments, that if adopted, will replace the definition of NDIS support currently in the Bill to clarify it and make it more accessible.  

Here are the links to the exposure draft and supplementary explanatory memorandum.

View the Supplementary explanatory memorandum . View the  Exposure draft - section 10 amendments .

• It makes clear the constitutional basis for the new budget setting framework recommended by the NDIS Review, and helps to clarify and identify the constitutional basis of the NDIS as a whole.
• For the sake of consistency and simplicity across the entirety of the NDIS Act, the definition has been adopted in key areas, particularly where references to supports being appropriately funded by the NDIS already exist. 
• If adopted, the proposed parliamentary amendment will replace the definition of NDIS support currently in the Bill to clarify it and make it more accessible.  
• Instead of making reference to specific articles, the definition now requires the support to implement any of Australia’s obligations under the Convention on the Rights for People with Disability (CRPD) or fall within the relevant aspect of the social welfare power under the Constitution. 
• The specific articles were referenced initially because of the way the section was structured, which meant that a participant had to identify whether a particular support was an NDIS support for them. Including each of the specific articles was done to assist this process.
• The new structure of the section requires the Minister to assess whether particular supports fall within the relevant articles of the CRPD, rather than the participant. Because of this, the specific articles no longer need to be referenced as the Minister will have awareness of all the relevant obligations under the CRPD in making the instrument without them being specified.  
• The original intention of the NDIS was to provide particular kinds of supports (‘reasonable and necessary supports’) to people with disability. This continues with the definition of NDIS supports. 
• By inserting a definition of ‘NDIS support’, the Bill does not tighten the kinds of supports the NDIS will fund. Instead, the Bill clarifies the supports that have always been available under the NDIS to ensure certainty for participants now and into the future.  
• This definition will include all supports capable of being funded by the NDIS, but something will only be an NDIS support for a participant if they have a need for that support as a result of their disability. 
• Category A NDIS rules will set out supports and classes of supports that are or are not NDIS supports. 
• Those supports must be appropriately funded by the NDIS. This consideration will take into account things such as intergovernmental agreements on what system is responsible for certain kinds of supports. NDIS supports must also have a constitutional basis.
• This provides certainty and clarity for participants and the disability community, as well as NDIA delegates. It will help participants select the supports that they are able to use their NDIS funding on. 
• It is important to understand that not every support that has a constitutional basis will be an NDIS support. Many of the supports that are covered by the CRPD are more appropriately provided by another system, such as the health or aged care systems. 
• These new rules will be tested and designed with the disability community and states and territories.
• The needs assessment is not a separate decision. Rather it is part of the process for approving a statement of participant supports. 
• If a participant considers that their statement of participant supports, which includes a reasonable and necessary budget, has not been determined correctly or is not adequate to meet needs, they can seek a review of the CEO’s decision to approve the statement of participant supports. 
• Consistent with recommendations of the NDIS Review, a participant’s reasonable and necessary budget will be based on a holistic assessment of their support needs.
• Participants can seek internal and external review of the decision to approve their statement of participant supports.
• This does not mean the entire assessment will need to be completed again, but that will depend on the information provided by the participant seeking review. 
• If a new assessment identifies different support needs, the reasonable and necessary budget may need to be changed as part of the review.
• At any time, as is the case now, a participant will also be able to request a reassessment or variation of their plan prior to its end date if their circumstances change.
• Yes. The new section (32D) requires the statement of participant supports to be prepared with the participant. This means that the individual will need to be provided with their needs assessment in order to participate in the process of deriving their supports.
• The specifics about the needs assessment and the participant experience, will be developed with the disability community through co-design and will then be set out in the rules and operational policy.
• Amendments made in the House of Representative require the National Disability Insurance Agency to provide a participant a copy of their needs assessment upon receipt.
• Assessments will be undertaken with participants to support their understanding about what will go into the report.
• The goal of the new budget settings is to provide participants with a more dignified, person-centred assessment and budget setting experience.
• New rules will set out the process by which the budget is determined, and when supports can be stated (as non-flexible items) in plans. They will also provide greater clarity and transparency about flexible budgets and what NDIS funds can be used.
• A key safeguard in the process for use of an instrument is the process required for the making of the instrument. This process means the instrument cannot be changed or altered without following the consultation and transparency requirements of the Legislation Act 2003. 
• Among other things, this requires consultation to be undertaken and detailed in the explanatory statement to the instrument.  The instrument itself is subject to scrutiny in the Parliament and disallowance.
• There will be consultation with the disability community and states and territories on all of the legislative instruments, and the needs assessment tool will be based on extensive consultation with experts in a range of areas to ensure it can adequately assess the needs of all people with disability.
• The Bill makes no changes to eligibility for the NDIS.
• A person can access the NDIS if they meet the disability requirements (section 24) or the early intervention requirements (section 25) or both.
• The Rules that will be developed in consultation and co-design with the disability community will provide clarity and detail about the meaning of key concepts in the Act. 
• For example, the Rules might tell us how to understand and measure substantially reduced functional capacity, or when an early intervention support is likely to benefit a participant. 
• This will address current barriers to access and provide greater consistency and equity in decision-making.
• Section 27 of the Act currently provides for rules about section 24 and section 25, the Bill does not change that, but only simplifies the way the rule-making power is explained to make it easier to understand and apply.
• The current NDIS Act includes a general principle that ‘people with disability are central to the National Disability Insurance Scheme and should be included in a co-design capacity’. The Bill does not change this principle in the Act.
• The majority of Rules will be Category A Rules, meaning all states and territories need to agree on any changes and Rules are all disallowable by the Australian Parliament.
• How the needs assessment process will work, including involving the participant, will be further explored in the engagement process. The Bill does not address how these will be operationalised by the NDIS.
• The Act still defines who is eligible for the NDIS. This is described in the disability requirements (section 24) and the early intervention requirements (section 25).
• It is important to be aware that the Act already allows rules to be made about section 24 and section 25. The new draft of section 27 simplifies and clarifies the existing rule-making powers.
• Any new rules will be developed in consultation and co-design with the disability community will provide clarity and detail to these provisions in the Act. For example, the Rules might tell us how to understand and measure substantially reduced functional capacity, or when an Early Intervention support is likely to benefit a participant.
• No. NDIS participants already in the scheme will continue to receive funding under the current framework while the new budget framework is being developed. 
• Under the current NDIS Act, a participant’s access to the Scheme can already be reviewed from time to time. For example, if a child has entered the Scheme to access early intervention supports, whether as the child ages, they continue to need access to the Scheme under the disability criteria.
• Once the new planning framework is developed, participants plans will be progressively transitioned to the new framework. 
• It is anticipated that both frameworks will operate side-by-side for a period until all Scheme participants sit under the new planning framework.

(e.g., if a planner asked for your diary for the last year, would you have to hand it over?)

• The new information gathering powers inserted by the Bill are limited to enabling the CEO to request information that is ‘reasonably necessary’ for the particular decision being made. 
• There are no general or broad information gathering powers in the NDIS Act. All information-gathering powers, including the new ones in the Bill, are limited and specific.
• In the context of sections 30 and 30A, this means the CEO can only request information that is reasonably necessary to deciding whether a participant continues to meet the access criteria.
• The language of ‘reasonably necessary’ is taken from the Privacy Act 1988 which means it is a clearly defined legal concept for explaining the scope of the power to collect personal information which is consistent with other existing information gathering powers in the Act.
• For example, it is unlikely a participant’s personal diary would be ‘reasonably necessary’ for a decision about ongoing access to the Scheme, so it would not be able to be requested under these new powers. It may be reasonable for a participant to be asked to provide a schedule of their use of particular supports. 
• The Bill does not significantly change the existing provisions around plan management. 
• The change made by the Bill is to ensure a participant cannot have a particular plan management type if that would put them at risk of section 46 not being complied with (which may cause a debt to be raised against the participant). This is intended to safeguard participants.
• This power is to be clarified in the rules which will be co-designed with the disability community and to which all states and territories need to agree. These rules will likely include criteria around the risk to the participant which will be straight forward to operationalise.
• The CEO of the NDIA and the Minister for the NDIS must act in accordance with the NDIS Act and other federal and state laws at all times. This Bill does not change that obligation. 
• The majority of Rules developed will be Category A Rules, meaning all states and territories must agree to any changes proposed by the Minster or CEO. 
• All legislative instruments, including NDIS Rules, will be subject to the requirements of the Legislation Act 2003 which, among other things, requires appropriate consultation to be undertaken. 
• This bill creates a new planning framework to build participant plans to include a reasonable and necessary budget, rather than identifying reasonable and necessary supports line-by-line.
• Participants will be able to spend their budget on NDIS supports.
• This change is to give participants more flexibility to use their plan to support their needs without applying to the NDIA for a variation or reassessment.
• Under the new framework, participants’ reasonable and necessary budgets will be based on the outcomes of a needs assessment using a method set out in a legislative instrument (not an NDIS rule).
• This needs assessment will be designed with the disability community and technical experts to ensure it identifies the supports the participant needs, that the NDIS is responsible for funding.
• Participants will not move to the new framework until the needs assessment and the method for calculating the budget have been developed.
• New framework plans will include similar elements to old framework plans including a statement of goals and aspirations and statement of participant supports. 

Reasonable and necessary budgets

• Reasonable and necessary budgets form part of the statement of participant supports.
• It can consist of both flexible funding and stated supports.

Flexible funding

• Flexible funding will be available to a participant where the needs assessment report for the plan indicates the participant requires at least some NDIS supports that are not stated supports.
• This is an amount, informed by the needs assessment, a participant may use to acquire a range of supports they need because of their impairment/s, provided those supports are appropriately funded by the NDIS. 
• This change implements action 3.5 of the NDIS Review, to allow greater flexibility in how participants can spend their budget, with minimal exceptions.
• This change is based on the principle that people with disability know their own support needs and are best placed to determine how to meet these needs. 
• The inclusion of flexible funding in a plan is the default position.
• In certain circumstances, the CEO may place restrictions on the spending of some or all of the flexible funding provided for in a reasonable and necessary budget. 
• A participant is likely to suffer physical, mental or financial harms if the flexible funding was not subject to restriction.
• A participant, their plan nominee or registered plan. management provider has not complied with the spending requirements (set out in section 46).
• A circumstance provided by NDIS rules (category A).
• These restrictions will only be used where a participant has a history of over-spending, non-compliance with the relevant NDIS rules, or the Agency has identified risk of harm to a participant.

Stated supports

• A stated support is a support, or class of supports, specifically identified in a plan.
• Funding for stated supports can only be spent on that support (or class of supports) and cannot be spent for any other purpose, including acquiring other NDIS supports.
• A participant’s need for stated supports will be identified through the needs assessment report.
• Category A NDIS rules will prescribe supports that are stated support for all participants or certain groups of participants. For example, high-cost assistive technology, home modifications and supported independent living may all be stated supports.
• These rules will be co-designed with the disability community.
• Including stated supports in participant plans is an important mechanism to ensure alternative commissioning agreements operate effectively.
• Stated supports are also an important safeguarding mechanism for the provision of higher risk supports that need to be provided by particular providers, or in a particular manner, to protect the participant from harm.

Funding periods/intervals

• Under new framework plans, flexible funding will be divided into funding periods, allocating the proportion of the total flexible funding within each period. Funding periods also apply to stated supports. 
• Each period will be no more than 12 months, with each period to run consecutively.
• This amendment ensures that funding is not spent in excess of the total budget. If funding is not spent within one plan period, it will be rolled over into the next, however not between plans.
• Participants will be supported to manage their budget and be able to seek a plan review or reassessment if their circumstances change.
• The Scheme has always been set-up to make changes to a participant’s NDIS funding, as necessary. 
• A participant’s funding may continue to go up and down in line with their support needs.
• The Review recommended changes to planning and plan budgets. This will give participants more choice and control of their supports with a flexible budget. 
• The Government will work in partnership with the disability community to develop the Rules for any changes to the planning process.
• Under the proposed legislation a decision to approve the statement of participant supports in a new framework plan will continue to be subject to internal and external review.
• The new planning framework addresses the findings of the NDIS Review that heard there are a number of significant problems with the current planning framework, including that people with the same or very similar support needs too often receive different levels of funding, which undermines trust and confidence in the NDIS. Central to the new planning framework will be a comprehensive needs assessment and new method for generating a reasonable and necessary budget based on the assessment report. 
• The methodology for how the reasonable and necessary budget is generated will only be finalised after deep engagement with the disability community and subject matter experts. This will be a transparent process to ensure the trust and confidence of the disability community. It will then be set out in a legislative instrument determined by the Minister, that will be designed to be fair and consistent and would be disallowable by the Parliament.
• For the new planning framework, as with the old framework, a participant’s plan will primarily consist of a statement of goals and aspirations and a statement of participant supports. The statement of participant supports will include a reasonable and necessary budget, stated supports, general supports, a plan period and details of the plan management arrangements.
• The new planning framework will allow for a much more flexible budget and so if a participant changes their goals or aspirations they will be able to apply their existing budget to meet these new goals and aspirations without needing to go back to the NDIA for approval to change individual line items in a plan or to seek a new plan. This was also a key finding from the NDIS Review.
• It is expected that discussions with the participant will occur before the needs assessment report is finalised, to confirm that all the information on a person’s support needs has been taken into account. How this works will be part of the work done during codesign.
• Where a participant identifies that the assessment report does not accurately reflect their needs and circumstances, they can request that a new needs assessment be conducted as part of the review application. This does not mean that the entire assessment will need to be completed again, but this will depend on the information provided by the participant seeking review. If the updated assessment identifies different support needs then this may mean that the reasonable and necessary budget is changed.
• This means that the focus of internal and external review is on ensuring that the needs of a participant are accurately assessed and reflected in the needs assessment, in order to ensure consistent and fair decision making that will build trust and confidence in the NDIS.
• The NDIS Review called for a 5-year transition.
• The proposed changes to the legislation are the start. They will enable design and testing of changes with people with disability as further improvements are made to the Scheme. 

Will this legislation make the NDIS more sustainable? 

• support a better participant experience and outcomes
• and support the sustainability of the Scheme. 
• The changes will make sure the Scheme can provide life-changing support for people with disability into the future.
• National Cabinet set a growth target for the NDIS of 8% by 2026-27. The changes to the legislation and the new NDIS Rule will help the Scheme achieve that target.
• In December last year, the Prime Minister, Premiers and Chief Ministers announced there would be new NDIS legislation in 2024. 
• Many of the changes will only come into effect once the new NDIS Rules have been developed and put in place. This will be done in close consultation with the disability community and states and territories. 
• The legislative changes will establish the power to make the new Rules, so they’re the first step.
• The Department is working on a public roadmap to provide opportunities for consultation and engagement in the development of policy and rules outlining details of reforms.
• Engagement by the Department with the disability community on key NDIS Rules will start happening from July 2024 and continue throughout 2024 and 2025. This engagement will include discussion papers on DSS Engage, face-to-face workshops and roundtables, as well as online engagement.  
• The NDIA will lead co-design, consultation and community engagement on how proposed changes will be implemented and operationalised.
• The NDIA has been working with people with disability and their supporters through engagement and co-design to deliver the Reform for Outcomes program and will build on this work, as well as other established and new reference and advisory groups, to support engagement on these changes. 
• Since the Government introduced proposed changes to the NDIS Act, the NDIA has been working with Disability Representative and Carer Organisations (DRCOs), our Independent Advisory Council (IAC) and Participant Reference Group (PRG) to improve their approach and confirm the next set of priority topics for co-design. 
• We recognise the experience of living rurally and remotely provides different challenges that need to be considered in the development of these reforms. We are still developing our engagement plan and will ensure we provide appropriate opportunities for people living rurally and remotely to participate fully in consultation and co-design.
• The changes address some of the key recommendations from the 2023 independent review of the NDIS.
• As part of the NDIS Review, there was deep engagement with the disability community. 
• The disability community helped develop the Terms of Reference for the Review. This was a key step to restore the trust between the disability community and government. 
• The Review Panel consulted broadly across Australia. They used lived experience from people with disability to inform their recommendations.
• heard from over 10,000 people and organisations
• received over 4,000 submissions
• spent over 2,000 hours listening to the stories, ideas, and feedback of people with disability
• had regular meetings with Commonwealth, state, and territory disability ministers.
• The Panel used findings from other reviews and inquiries, like the Royal Commission into Violence, Abuse, Neglect and Exploitation of People with Disability.  
• The voices of people with disability will stay at the centre of implementing the changes to the NDIS. 
• There will be more consultation about the development of the NDIS Rules and other changes.
• The Government will keep the voices and needs of people with disability at the heart of all NDIS reforms.
• Government spoke with people from the disability community and the NDIS Review Panel before they introduced the Bill.
• These legislative changes are the first step. 
• Many of the changes to the Scheme will be made through new NDIS Rules. The Government will work in partnership with the disability community to develop the Rules. 
• experiences
• We will design the next steps with the disability community and state and territory governments.
• Co-design is how we get better outcomes for people with disability.
• You can subscribe to the Department of Social Services for updates on the NDIS reforms - https://engage.dss.gov.au/subscribe-for-updates-to-the-ndis-reforms/
• You can keep track of the Bill via the Parliament House website: National Disability Insurance Scheme Amendment (Getting the NDIS Back on Track No. 1) Bill 2024 – Parliament of Australia (aph.gov.au) .
• You can register to receive updates by clicking on the ‘Track Bill’ button.

When consultations open, we will:

• Provide Auslan and Easy Read versions of documents
• Online and/or face to face workshops, surveys, surveys, submissions and more.

We are open to your suggestions about ways of engaging with your that would work best for you. Please email us at [email protected]

• We are very keen to provide the opportunity for everyone to have their say in a way that suits them, wherever possible. We invite you to let us know the best way to engage with people with psychological and psychosocial disability via [email protected]
• We recognise the importance and value of First Nations voices in developing and implementing these reforms and acknowledge that engagements need to be culturally safe and appropriate. We are still developing our engagement plan and will ensure we appropriate opportunities for First Nations people to participate fully in consultation and co-design.
• We recognise the experience of living rurally and remotely provides different challenges that need to be considered in the development of these reforms. We are still developing our engagement plan and will ensure we appropriate opportunities for people living rurally and remotely to participate fully in consultation and co-design.
• You can choose to share your contact details with the department to be kept up to date on engagement activities about the NDIS reforms, including any changes to legislation and the NDIS rules. You can subscribe here: Subscribe to receive updates on the NDIS reforms | engage.dss.gov.au or you can find out more about our engagement activities here: engage.dss.gov.au
• The Government is considering the recommendations of the NDIS Review. It has not yet issued a formal response.
• This Bill responds to National Cabinet’s agreement to legislative change. It is an initial response to the NDIS Review’s findings.
• Government will release its full response to the Review later in the year.

When will other NDIS Review recommendations (not addressed in this Bill) be pursued? 

• Government is considering all the recommendations made by the NDIS Review. 
• The NDIS Review made a range of recommendations with potential implications for the NDIS Act. For example, recommendations around the powers and functions of the NDIS Quality and Safeguards Commission.
• Future legislation will depend on Australian Government decisions around such recommendations.
• The government is currently considering the findings of both the NDIS Review and the DRC to ensure that a holistic approach is taken towards improving the lives of people with disability, carers and their families.
• This Bill does not change a child’s participant status or remove their access to the NDIS.
• There will be a new early intervention pathway for children who enter the Scheme under the early intervention requirements (s.25).
• There will be targeted early intervention support for children. 
• We will work with the disability community to develop the new early intervention pathway. 
• We will work with the disability community to develop a new early intervention pathway.
• When the new early intervention pathway is implemented, the supports your child receives will be tailored to their needs.

The final report of the NDIS Review says the Australian Government should work on:

• Attracting, keeping, and training a workforce that meets the needs of participants and provides suitable support. 
• Create and test new ways to attract and keep workers. 

The Disability Royal Commission into Violence, Abuse, Neglect and Exploitation of People with Disability also suggests:

• More training for workers.
• Ongoing professional development.

The Australian Government knows it's important to attract and keep workers in the disability sector and is looking at the findings of these reports.

How will the changes affect people with psychosocial disability’s access to the NDIS?  

• This Bill does not change your participant status or remove your access to the NDIS.
• We will work with the disability community to consider the recommendation in the NDIS Review about a new early intervention pathway for people with psychosocial disability.
• The proposed changes to section 27 will help define certain aspects of the Act more clearly. For example, they might explain how we measure someone's reduced functional capacity or when early intervention support could help someone with psychosocial needs. We'll be developing these rules together with input from the mental health sector and disability community.
• The design of new rules is still to occur and will involve the disability community. It is important that people who access the NDIS meet the eligibility criteria and once an NDIS participant that they inform the NDIS where there has been a change in their circumstances.
• The NDIS may seek information from a NDIS participant from time to time, where the NDIS participant does not respond to this request, the NDIS may make further attempts to get in connect with them to better understand why they have not responded. This would assist in determining if the NDIS participant remains eligible, or in instances where the NDIS is not able to make further contact with the NDIS participant they might be existed from the NDIS.
• Rules could be made to use alternative commissioning for psychosocial supports, but this needs to be discussed as part of the rules engagement process.
• The NDIA's preference is always for NDIS participants to manage their plans whenever possible. There are instances where NDIA management may be considered, several measures are in place to ensure fairness and minimal impact, especially on the mental health community.
• Decisions regarding NDIA management are made after careful consideration of various factors, including the participant's well-being, past spending behaviour, and whether any harm—physical, mental, or financial—might result from alternative arrangements. Additionally, the process allows for flexibility, such as accommodating participants who request plan management by themselves, a nominee, or a registered plan management provider. This approach aims to strike a balance between empowering participants and ensuring responsible management of NDIS funds.
• The current Bill does not cover provider registration. The Government has set up a task force to gather input on this issue and develop a new regulatory model. The Taskforce will provide advice to government on the design and implementation of a graduated risk-proportionate regulatory model later this year./li>
• The Bill does not change your participant status or remove your access to the NDIS.
• The Australian Government and state/territory governments are working together on developing Foundational Supports, including Foundational Supports for children, while the NIDA are leading work to develop a new early intervention pathway for children under 9 years old. 
• Both processes will include engagement with people with disability, families, carers and the broader disability sector and will consider evidence-based supports and best practice in respect to any funded services.

Foundational Supports  

When will foundational supports be implemented .

• The Review sets out a 5-year implementation plan for changes to the NDIS and improvements to the broader ecosystem. 
• Last year, National Cabinet agreed to design additional Foundational Supports. These will be jointly commissioned by the Commonwealth and the states.
• Earlier this year, the Government announced $11.6 million to support the development of a Foundational Supports Strategy.
• There will be a phased approach to designing and delivering foundational supports. Services are expected to will be commissioned from mid-2025, and progressively scaled to full roll out by mid-2027.
• Foundational supports will improve access to evidence-based supports for people with disability in community settings and better connect them to the mainstream services that all Australians rely on.
• The NDIA is leading the co-design, consultation, and community engagement on how proposed changes to the NDIS will be implemented and operationalised. 
• DSS is working with states and territories on arrangements for national consultation on Foundational Supports.  We encourage everyone to keep an eye on the DSS Engagement website and the NDIA website . 
• protect people with disability against exploitation
• combat fraud in the Scheme. 
• These are immediate measures. They will improve the scope and powers of the Quality and Safeguards Commission. This will give Government time to consider the findings of the NDIS Review and the Disability Royal Commission.
• The changes will help the NDIS Commission to better administer parts of its compliance and enforcement powers.    
• Quality auditors play an important role in safeguarding participants. The NDIS Quality and Safeguards Commissioner (the Commissioner) will make a Rule that means an approved quality auditor does not employ or engage a person who has a banning order. 
• This will stop banned persons from being able to move from the NDIS market system into the role of an Approved Quality Auditor. 

Why increase the number of Commission officers with compliance powers? 

• The Government wants to ensure when we discover bad behaviour, we can act on it. 
• The Commissioner will have the power to delegate compliance and enforcement powers and functions to more of the skilled officers in the Commission. 
• This will make it easier for the Commission to use its compliance and enforcement powers under the Act.
• Where or how a child is schooled would not preclude their ability to access support.
• Foundational supports are about bringing more disability supports into and around spaces where children live, play, and learn.
• The Government recognises the complexities and diverse views demonstrated in the Royal Commission’s recommendations and commentary on education, employment and housing, particularly around segregated settings.
• The Government is carefully considering the Royal Commission’s education recommendations, and consulting with people with disability, their families, parents and carers, and relevant stakeholder groups before commenting on individual recommendations.
• The Australian Government and state and territory governments have begun preliminary work to develop a shared approach to the design and implementation of Foundational Supports which will include engagement with people with disability, families, carers and the broader disability sector. Consideration is being given to the kinds of supports available under Foundational Supports and eligibility.
• Targeted Foundational Supports are focused on people do not require the level of specialist individualised support provided as part of NDIS and are specific supports designed for specific cohorts of people with disability not in the NDIS.
• In December 2023 National Cabinet agreed the Commonwealth and the state would jointly design and fund additional Foundational Supports.
• National Cabinet also agreed funding would be agreed through new Federation Funding Agreements.
• Proposed changes to section 10 seek to provide greater clarity to NDIS participants on what supports they can access through the NDIS. NDIS rules are yet to be developed, once developed this aim to provide greater clarity on what supports can be funded and would eventually replace the current APTOS.
• The Government has established the NDIS Provider and Worker Registration Taskforce to provide advice on Recommendation 17. 
• No decisions have been made regarding universal registration.
• Cracking down on fraud remains a priority for the Australian Government. The NDIA continues to take a range of actions to detect and address fraud using existing legislation.
• Responding to the NDIS Review’s recommendations around pricing also remains a priority. The Government expects to make further decisions about that in future. 
• The Government announced a Fraud Fusion Taskforce (the Taskforce) in October 2022 to strengthen fraud detection and better safeguard the NDIS from serious organised crime and other fraudsters. 
• The Taskforce allows better intelligence sharing, identification and response by the NDIA, NDIS Quality and Safeguards Commission, Services Australia, other program departments, law enforcement agencies and other regulators to fraud perpetrated by those seeking to exploit the Government’s system of social supports. 
• It is expected that this Taskforce will, over time, reduce the amount of money lost to fraud and take criminal, regulatory and administrative action against those who seek to take advantage of NDIS participants.

Last updated: 5 September 2024 - 12:24pm