Accounting Prospectus

Objective:

Research and propose a hypothetical business venture to potential investors (not a bank, crowd-funding "investors" or friends/family).

What's the purpose of a prospectus?

The purpose of a business prospectus is to secure support for a planned product or service. You would use a business prospectus to showcase information necessary for investors to determine whether they want to fund your venture. Mission statements, market analyses, and financial projections are all basic components of a prospectus (see below)--your goal, as a businessperson seeking funding, is to ensure that potential investors will find these components persuasive.

Paper structure:

For this assignment, please adhere to the guidelines described in chapter 14, beginning with "Creating Successful Business Plans" (pgs 403-404). This section is a useful roadmap for drafting and will also inform what I look for while I'm grading. In particular, focus on addressing the following points as is described in the text:

• Summary
  • ...of prospectus overall--be sure to focus on the things mentioned in the text and consider what kind of info your audience would be most interested in (i.e. what would compel them to read on?)
• Mission and objectives
• Company and industry
• Products or services
• Market and competition
  • This relates to your specific target market, NOT the overall industry in which your business falls--sometimes you'll find these terms used interchangeably, but please don't do that in here)
• Marketing strategy
  • Read the section description carefully--there is information that is often overlooked here (i.e., sales and market share projections)
• Design and development plans
  • For our purposes, this can relate to a product OR a service, e.g., you can describe the set up of your restaurant.
• Overall schedule
  • NOTE: this is about "important milestones..." NOT daily operations or anything like that.
• Critical risks and problems
  • Go beyond just the obvious day-to-day challenges of running a business like yours.
• Financial projections and requirements
  • Effective presentation choices make a big difference here--typically, presenting this information in sentence/paragraph form is not effective (at least for most of it).
• Conclusion/Exit Strategy
  • Remember, though your audience is certainly interested in your business, in the end, they are most interested in the investment opportunity itself.

NOTE: You are only required to include the above sections (PLEASE INCLUDE HEADINGS), but if there are others you'd like to add, like an appendix or another section mentioned in the text on 403-404, you're welcome to do so. Just be sure you include all of the above and address them as is described on 403-404.

Parameters:

• To keep things somewhat realistic, assume you will have about $50,000 in start up capital to get the company off the groundthe purpose of the Business Prospectus Assignment is to persuade investors to provide additional capital for your business. Think carefully about the scale and the potential ask. You couldn't get a computer manufacturing business to compete with the likes of Dell and Apple going for $100k; and, you can't expect investors to fund a company with essentially no capital: i.e., if you have $50k and you ask for $1,000,000 you have essentially no capital (there might be exceptions to this, especially in the tech industry, but those exceptions are rare and it's not realistic to expect something like that). If you don't know much about small business investing/investors do a little preliminary research (you could even call watching a couple of episodes of Shark Tank "research" for this). Hopefully this bit of restriction adds to your interest in the assignment as opposed to reducing it!
• And finally, some things you'll want to avoid/be careful of:
  • Please don't go the "...seeking a bank loan" route--that essentially sidesteps the assignment, since banks have very specific application requirements and much of what you'll be asked to include in the prospectus would likely be irrelevant to this audience.
  • The same goes for the "GoFundMe" route--again that's the wrong audience to have in mind.
  • And the same goes for family and friends as well--as they would likely have a very different set of criteria (conscious of unconscious) guiding their interest/decision in this case (again, it's the wrong audience for the assignment).
  • And finally, though "angel investors" would be a valid audience, don't use that to sidestep the assignment either: research--"angel investors" are not purely benefactors or donors, they are investors, which means they are banking on your success and are in it for the potential cut (usually a large one due to the risk they are willing to take).

Research Requirement

Your prospectus should include at least 5 sources. The sources you select need to support the claims you are making in the Company and industry, Market and competition, Financial projections and requirements and perhaps the Critical Risks/Problems sections. These sources should be solid "academic/professional" sources and I'd like to see at least one or two peer reviewed journals included (i.e., avoid common knowledge sites like Wipipedia or Amazon and things that sound more like they're geared more toward the general public like "10 ways to start a food truck..."). Refer to the ENG 311 Research Guidefor help finding sources. Format your sources according to APA guidelines.

Strategies for planning and pre-writing:

All of the strategies we discussed while reading Ch. 1 and 5--and that you put into practice while writing workplace memos and blog posts--will still be useful here. Because the prospectus is a longer assignment, however, the planning and pre-writing stages become much more important. Focus on creating a detailed outline in order to make your drafting process easier and your prospectus more coherent.

Your first steps toward a persuasive prospectus can be broken down into two categories: content and rhetorical strategies. In other words: what are the facts, and how will you choose to present them?

When planning content, focus on big picture questions related to your business, but be sure to include concrete information to explain things. What is your product or service? Who is it for? How will it be priced and distributed? Refer back to what you learned in Ch. 13 regarding researching and processing data.

Once you've established the basic information about your product or service, you can start pre-writing notes about your rhetorical strategies. Your audience will comprise investors who are learning about your company for the first time and deciding if this might be a good investment.