Capital, a necessity to both start-ups and the established, is a key ingredient for any business. A business is usually financed in one of three ways:

1. Self financed - operations funded with own money
2. Debt financed - borrowed money
3. Equity financed - someone acquires a partial interest in the business in exchange for money.

Debt financing is the most subjective. No matter whom you approach to borrow money, lenders will be reviewing your personal and business information. The decision is their assessment of the risk of loaning their capital to you. Traditionally, there are five basic benchmarks that lenders evaluate: character, creditworthiness, capacity, collateral and conditions. A prospective borrower's business plan needs to show strength in as many of these areas as possible.

1. CHARACTER is measured in terms of stability in your job (or industry), and time in your community (residences). Other factors considered include what you say you have learned from prior successes and failures and what evidence you are presenting to prove that you are qualified to run a business.
2. CREDITWORTHINESS is measured by how timely you have paid your past obligations. This information is usually dependent upon reports from the major credit reporting agencies.
3. CAPACITY is a measurement of your ability to repay this new and additional debt. Financial Reports showing past activity and future projections will indicate the volume of your cash flow, income stream, and how available or liquid are your back-up assets.
4. COLLATERAL the assets pledged to secure the loan.  The pledging of personal assets and the personal guarantees of owners/officers are often security to business debt.
5. CONDITIONS refer to the time and terms you are projecting as necessary to achieve the goal for which the additional money is being requested. The amount of time projected for the desired results to positively impact your organization is also considered.

At MillerMusmar, PC, we believe a business plan should contain both short-term and long-term information based on realistic figures. We tailor the look and polish the supporting detail of each business plan to best match what we perceive to be the expectations of the reviewing party.  The quality of the content, however, always remains focused and factual.

 In our experience, a typical business plan contains the following sections:

1. Management Skills Assessment
2. Mission Vision: The Positive Differences
3. Industry Overview and Competition
4. Analysis of How to Reach the Buying Market
5. Product Strategy: Development and Delivery
6. Entity, Capital Structure and Tax Planning
7. Financial Performance

Additionally, a "dress rehearsal" presentation and dissection of the plan is recommended. Partnered with a trusted at-arms-length third party (your accountant, banker, or a business associate) this process is a great learning step and confidence builder.