Investment proposals are your chance to turn passion for your business idea into funding. But how do you make potential investors share that passion—enough to provide you with financial support?
The key is crafting an investment proposal that tells your business story with clarity and conviction. You’ll weave together a narrative about the problem you identified in the market, how your product or service will stand out, and why your team has the expertise and passion to deliver.
And, just like any good story, it must keep readers interested at every turn.
“The goal is to entice, engage, and educate,” says Michael Duda, cofounder and managing partner of Bullish Inc., a venture capital firm that has invested in companies like Warby Parker, Peloton, Harry’s, Bubble Beauty, and Bandit Running. “To do that, you have to draw me in.”
What is an investment proposal?
An investment proposal is a document or pitch that communicates your business and financial opportunity to potential investors. This proposal explains your startup idea, the challenge that your product or service addresses, the market potential, how your business will make money, and why this investment is likely to succeed.
Although your investment proposal presentation can theoretically take different formats, Michael strongly warns against lengthy text documents. Instead, he says, investors tend to prefer a compact presentation of 10 to 15 slides, made in a program like Google Slides or PowerPoint.
“Formatting it this way gives us the chance to click through much more quickly and get the general feel for your proposal,” Michael explains. “At Bullish, we see about 2,000 proposals each year and make only about six to eight new investments. That’s a low percentage. So we’re looking for what grabs our attention quickly.”
Investment proposal vs. business plan
Investment proposals and business plans typically contain some of the same information, but the two items are different—particularly in tone, purpose, target audience, and format.
An investment proposal is designed to pitch a business to prospective investors, such as venture capitalists or angel investors, to secure funding. It’s persuasive in tone, opportunity-driven in scope, and typically formatted as a series of slides to engage the reader.
A business plan is a more comprehensive document that describes in detail how the startup will operate and grow. It’s a data-heavy asset that’s generally aimed at internal use, helping you and your team map out the next several years and track progress toward your goals.
Investment proposal components
- Cover page
- Executive summary
- Business description
- Market opportunity
- Business model
- Operational strategy
- Team
- Financial projections
The components of a successful investment proposal can vary based on your specific startup, and may go by different names. One company might call a section “Market Analysis,” for instance, while another calls it “Market Opportunity.” But these are the major points that potential investors expect to see in your business proposal:
Cover page
Cover pages are simple slides that contain basic information like your company name, contact information, and the date you’re sending the pitch. It’s also a chance to display your startup’s branding with colors, font choices, and logos. You may additionally opt to include a table of contents after this slide.
Executive summary
An executive summary is a high-level overview that provides essential information about your business proposition, while also grabbing investors’ attention. It should lay out the key points of the rest of the pitch to come, with a persuasive and forward-looking tone that focuses on why this investment opportunity is so compelling.
“To use an article as an analogy, think of the executive summary as your catchy headline,” Michael says. “I want to know what’s really interesting upfront—not halfway through the article—so it makes me want to keep reading.”
Business description
In this section, you’ll tell a compelling story about your passion and your business. Think of it as the human part of your narrative: the problem you identified, why you care so deeply about it, how you’ll solve it, and why this is a great investment opportunity.
Consider questions like: What sparked the idea for your business? What’s the key problem you’ve identified in the market, and who’s affected by it? What is your product or service, and why is it an innovative or unique solution to this problem? Include your overall business goals and your mission statement (if you have one).
When telling this part of your story, it’s important not to assume the potential investor has a ton of knowledge in your niche, Michael says. Try to step outside your role as a subject matter expert, and imagine what someone who’s new to this space needs to know.
“You have to dumb it down, honestly, which can be tough because you know everything about this business—but you have to remember that the investor doesn’t,” Michael says. “I’m coming out of a meeting about a new fruit snack and going right into talking about a water-bottle company. I’m constantly context-switching, so I need you to break things down to the simplest level to make it powerful.”
Market opportunity
This section tells the financial part of your story, backing it up with numbers and facts. Here, you’ll provide research that explains the market size and the portion of that market you expect to reach. This often includes a few specific figures:
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Total addressable market (TAM). The entire revenue opportunity for a particular product or service if every single potential customer bought your offerings.
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Service available market (SAM). The portion of the TAM that your company can target and serve with its current business model and capabilities; in other words, the subset of potential customers who need your product and fall within your reach based on factors like geographic location and price point.
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Serviceable obtainable market (SOM). SOM is a segment of SAM that captures the realistic market share for your specific offerings, considering your brand awareness and competitor traction—plus your historical company performance, if your company has been around for a bit.
You might also include a brief description of your customers (perhaps in the form of buyer personas), market trends that predict future growth, market research that supports your product’s unique selling points, and any other information that shows why the business is poised for success.
“In short, it’s, Here’s what’s going on now, and here’s why we’re better than what’s out there—or perhaps taking advantage of a fundamental shift, ” Michael says. “Show me that this is a market ripe with opportunity, and that you’re offering something special to maximize that opportunity as much as possible.”
Business model
While your business proposal must showcase your passion and products, it ultimately needs to convince potential investors that their investment will generate strong returns. In this section, you’ll explain how your business model is set up to do just that.
Explain in detail how you will generate revenue, including all products and revenue streams. Describe your pricing model, show how you’ve calculated profit margins, and provide a plan for how you will expand and scale your business. If your startup is at the stage where you’re already making sales, demonstrate your financial performance so far and prove your idea already has traction.
Operational strategy
Describe your organizational structure and operational strategies, whether they’re already in place or if they’re part of your plans as an early-stage business. These details could include:
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Marketing and sales. Advertising and marketing strategies, content, sales strategy, distribution channels, and go-to-market approach.
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Production. Logistics, manufacturing, supplier contracts, and facility locations.
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Future plans that leverage funding. How you will use the capital raised.
Team
Introduce the key players in your story: Showcase your current team with headshots and brief bios, focusing on experience and expertise that’s relevant to your startup. This might mean sector knowledge—for example, if you’re pitching a footwear brand, you might tout your product development experience at a household-name sneaker brand. Or it might mean track record, if you have previously succeeded in delivering value for backers in another venture. Or it might be a more personal story that highlights your particular connection to the problem your business is trying to solve or the unique insights you have about your target audience.
If your team’s expertise or personal ties are particularly strong, you might also consider placing this section earlier in the presentation.
“The people are really everything,” Michael says. “So much comes down to the founding team. We’re looking for super passionate people who have done the work, know what they’re talking about, and are ready to build.”
Financial projections
This section focuses on your business’s financial future. Expect to map out your expectations for the next three to five years or so, including revenue, expenses, net income, and cash flow, Michael says. When do you expect to break even, and to turn a profit? When do you believe investors might see a return on investment (ROI)?
“At the end of the day, I’m looking for businesses that can make a lot of money,” Michael says. “You don’t need to share the entire detailed model with every possible scenario, but I’m looking for at least some high-level financial projections to indicate how you are thinking of building the business.”
Investment proposal template
Need inspiration for a compelling investment proposal? Use this free investment proposal template to get started:
Investment proposal FAQ
Is an investment proposal necessary to secure funding?
Occasionally, a startup might manage to secure funding based only on a business plan. But typically, an effective investment proposal is considered a crucial way to attract investors and communicate the business opportunity.
What do you write in an investment proposal?
An investment proposal is a document or pitch that communicates your business opportunity to potential investors. This proposal explains your startup idea, the challenge that your product or service addresses, the market opportunity, how your business will make money, and a compelling argument for why you will succeed.
What is the difference between a business plan and an investment proposal?
A business plan is a more comprehensive document that maps out how the startup will operate and grow. It may only be used internally, or it may be provided to traditional lenders when seeking loans. A startup investment proposal pitches the business to potential investors to secure capital, so it’s persuasive in tone and is typically a slide presentation.
