There are a ton of ways you can finance a small business — including your new startup. So don’t hesitate to start your own business because you’re a little short of cash.
Seeking out investors is just another basic step in starting a business. Part of that process may be writing a good pitch letter to potential investors.
Here’s my sample pitch letter for financing:
Angel Investor Network of Greater Metropolis
1000 Main Street
Metropolis, NY 10020
Dear Mr. Smith:
To follow up on our phone conversation, I am forwarding you the requested copy of my business plan for Bob’s Rent-A-Bike.
We will be renting bicycles to summer visitors on Cape Cod beginning this coming June. I believe we are well positioned to succeed in the business because we will aggressively promote our strategy of delivering our bicycles directly to our customer’s summer locations, such as motels, campsites, and summer house rentals.
There is a large market for summer bicycle rentals on Cape Cod, with thousands of bicycles being rented in many locations throughout the area. But there is yet to be a firm that delivers rental bicycles right to the customer.
We are seeking financing of just $7,500, largely to purchase a fleet of 50 used bicycles and also to help cover start-up costs such as advertising. I am investing my personal savings of $2,500.
I know the $7,500 finance amount is quite a bit less than your usual investment commitment. However, there is a substantial upside to Bob’s Rent-A-Bike. Furthermore, the risk is very low because there is a huge market for bicycle rentals on Cape Cod. We believe many people would prefer to have bicycles delivered directly to them. In addition, because the majority of the investment is for bicycles, your investment would have substantial security.
I will call you in a few days, after you have had a chance to review the business plan. In the meantime, do not hesitate to call me with any questions.
Bob Adams is a Harvard MBA serial entrepreneur. He has started over a dozen businesses including one that he launched with $1500 and sold for $40 million. He has written 17 books and created 52 online courses for entrepreneurs.