Brochure for Investors

[JuliePgh]

Does anyone know the basic "rules" of what should or should not be included in a brochure to attract investors to a new business venture?

[Fern]

I've been watching this thread. . .really hoping you would get some knowledgeable responses so I could learn something too!

I picked around over the internet trying to find some samples of brochures for investors, but didn't have much luck. I did find one or two, but haven't a clue if they fit your situation or not.

I'm assuming since it is a brochure to draw in investors it would need to include some of the same type things you would include in a business plan. I don't know what type business, but I'll just give a photography shop as an example. Say they already have a business but want investors to be able to expand. You might include:

Assets - Not cash on hand, but such things as prime location, building, equipment, present customer base; the owners skills and employee skills, anything there that will encourage faith in ability.

Demographics - Town location, population (be great if you could get breakdown so you could give number of children in area) - Area that would be served. . .such as if it is a rural area you might take in more than one town - what is your competition?

Target market - presently your business is what percent kids photos, what percent action photos and what percent wedding and what percent other. You want to do a push on targeting what group?

Strategy: How you are going to reach that group.

You are shooting for action photos - then you are going to target such events as rodeos, ball games, swimming contests, even kid's birthday parties.

Maybe you have permission to set up at local Walmart or some where like that, but you'd like to add school photos to your business: list # of schools and # of children in your area range and list all the functions a school might have photographers for: school photos for the yearbook, fall photos, spring photos, Christmas photos, Valentines photos, graduation pictures, proms plus candid shots at proms.

What's in it for investors besides return on their money? Will they get some kind of advertisement out of the deal or how is it beneficial to them?

Anyway, you get the drift. . .just anything an investor might want to know before sinking their money into a business and what's in it for them.

Of course, all that stuff not to be in the order I gave it and it should condense nicely, bulleted and all that stuff.

Hopefully someone with investor brochure experience will pop in with suggestions. I really hope you will come back here and let us know how the final product turns out. . .how you do it, etc. I'd be very interested to know.

Good luck.

[alleycat]

I'm assuming you know about all the SEC requirements?

[Fern]

Can't speak for Julie, whose thread this is, but I don't. For myself & any others reading along trying to learn as much as possible, what are SEC requirements and where might one look them up?

[JuliePgh]

My customer is a start up, and I don't think they've even thought through how they'll approach investors. I too looked on the interet for brochures and only came up with one which isn't even closely related, but does target investors. This is what I found:

http://www.2ontario.com/software/brochures/investing_in_ontario.pdf

Fern, could you send me the links to the brochures you found?

AS for SEC requirements, I'd like to know how that affects what I write in the brochure. If you're talking about what they need to put in their business plan, that is out of my domain for this project. I didn't think a brochure would be subject to any SEC rules, or other government rules, excluding the usual liable, false advertising and so on. Please elaborate.

[alleycat]

Julie/Fern,

I'm not an expert on this; I usually see it only from an investor point of view.

For a larger, publicly traded companies there are strict SEC guidelines for stock offerings. For smaller companies, generally the state regulations are going to apply. In any case, this will have to be checked by an attorney or the start-up could get their butt in a sling.

Is your brochure going to individual investors, or to venture capitalists? This would have a bearing on what to include in a brochure. If it's venture capitalists, a "brochures" isn't really what's needed.

[JuliePgh]

Julie/Fern,

Is your brochure going to individual investors, or to venture capitalists? This would have a bearing on what to include in a brochure. If it's venture capitalists, a "brochures" isn't really what's needed.


That's probably the real problem I'm up against... they haven't defined who their investors are. I told them they need an idea as it affects the marketing aspect, including the brochure.

[Fern]

http://www.greaterakronchamber.org/content/resources/1111697009.gac2005investorbrochure.pdf
brochure

http://www.dfi.wa.gov/sd/publications.htm Great site, I thought! This site may help you by being able to see what investors are told to ask prior to investing

There doesn't seem to be many samples out there available to look at. Might also try looking in your templates if you have something like PhotoShop or in Microsoft Word or MS Publishing to see what they have.

[Quiller]

Caution. Promoting investment in a non-licenced offering can be decidedly illegal. You *can* write a detailed Business Plan and hand it around to various potential investors, but promoting investment is a whole nuther kettle of fish.

If I were writing a brochure for such an organization (I don't think I would, though I have written business plans) I would most certainly do it at arm's length, on a handshake only, and for green cash only. Your name does not get attached to anything, you are only offering suggestions that the business developer will run by his attorney for the legal issues and your car is parked where no one can read your licence plate.

[JuliePgh]

What exactly is a "non-licensed offering"?

[sulong]

I'm not an expert here, but I know a little about the world of finance. The person who wants wants to raise funds through the brochure needs to define his target. But to do that he needs to research the limitations of the different paths to raising funds.


When you use the word “investor” the SEC gets very interested. Investor implies an exchange of money for ownership in the form of shares. Depending on the quality of the “investor” there are different rules applied to the offering.


There are at least two types of “investor” that I'm aware of, these are “investor” and “accredited investor”.


There are still other ways of raise funds to avoid the whole sec thing. Mostly its just an exercise in rearranging words. “Member” instead of “investor” for instance, “privilege” instead of “return”.


Without knowing the product or service being pursued I can only speak in general terms. But there is enough keywords here for an exploration into the limitations of different fund raising methods.

[JuliePgh]

Since my clients haven't defined their investors, and I don't know yet how they plan to pay investors, etc, AND I dont' want to fool with the SEC, I'm thinking perhaps my clients will go for more of a "here are the facts about us" type brochure, with a section about the business plan, i.e. some wording like "Business Plan available upon request to interested parties" . Do you think that would be a "safer" approach and still get across to people that it's a start up looking for investors?

[sulong]

The easiest way might be to stop using the word “investor” , and instead say “looking for funding”, or "sponsorship". Something along those lines.

[JuliePgh]

But isn't changing the word just semantics if the concept is the same? I'm certainly not a lawyer, but I get the impression from past reading that the intent is over more powerful than the words used.

[sulong]

Investor has it's own definition, as does sponsor, and funds raiser.
They all have the same goal; getting other peoples money. Investor is perhaps the most regulated.


By using a more generic term, you give your client some time to decide on his specific target audience and whats required to accommodate them.


Is your client incorporated? Is he selling shares for startup money? If so, he's got to work through the sec regulation process. Or make everybody an officer of the corporation.


If he is not incorporated or in the process of incorporating, then the word “investor” becomes an issue.


One can begin with a generic term and at some later date get more specific.


Most of this stuff ought to have been decided and recorded in the business plan. If you can see the business plan maybe it will offer some guidance to the types of funding presently legal for his business to pursue.


Otherwise all you can do is be generic.
( I should have said your best choice is to...)

PS. Semantics make the world go around.

[alleycat]

Leaving the legalities aside, if you want to get a feel for what to include, look at any annual company report. The beginning will be generally be a "feel good" piece about what the company has done and what it plans to do in the future. It's not quite the same as you're doing but you might still find it useful

[JuliePgh]

I just found out that my client is hoping to attract Angel investors. How do I go about finding what if any legal restrictions/regulations apply for what I write in a brochure?

[Fern]

Julie, I just put "How to attract Angel investors" into my search engine and came up with oodles of stuff. Might be worth looking through some of them.