Executive Summary
The funding proposal is your chance to convey your passion and knowledge of the business you own to the donor.
In short, it is a request for an investment in a non-profit or for-profit project.
Donors look at a funding proposal as evidence that your business has strong management, experience,
and a thorough understanding of the marketplace.
The best way to start your proposal is with a simple and direct cover letter or executive summary. Use this page to clearly and briefly describe who you are, your business background, the nature of your business or start-up, and how the funding will be used.
Funding executive summary should consist of two or three paragraphs summarising the project's key points or objectives, with sufficient detail and specifics. Avoid generalizations and “fluff,” get to the point, and be pragmatic and factual.
Your funding proposal's first sentence should always be who you are and how much money you are requesting. Then, move into more basic information about your business:
- Business Name
- Business Entity Structure (S-corp vs. C-corp, LLC, sole proprietor, etc.)
- Time in Business
- Current Annual Revenue
- Current Number of Employees, If Applicable
Let's not forget, you can dramatically improve your
chances of getting the funding if your proposal is powerful enough.
If the donors see you as a highly professional, organized, and serious business person, it will force them to pay attention.
Unfortunately, most small business owners prepare their proposals poorly, and that surely doesn't help their case since most donors are incredibly risk-averse.
Keep following the pages of this template to craft a professional-looking funding proposal to ensure all the right information is at the right place.
The goal is to make you look organized, knowledgeable, and without red flags to potential donors.
Overview Of Your Business
Use this page to describe your business model or business profile. The goal is to explain in detail what
exactly your business does.
Your business profile should also act as a "body" of your funding proposal. That's where the main selling job is done and where you make the donor believe that your project is worthwhile.
Include your business track record (success stories), company goals, and philosophy; essentially, why your company should be selected.
The goal of this chapter is to show that your company has the capacity and the ability to meet all deliverables while also meeting all legal, safety, and quality obligations.
Don't forget to include the history of your business, along with current activity, results, and any potential opportunities or problems for your company or donor. If you have any links to your brochures or cooperations, make sure to post them to this page as well.
However, while this proposal is a "sales" document, present facts, not marketing materials to your business profile, as funding proposals are all about "soft" selling.
Management Experience
Use this page to describe the experience, qualifications, and skills of each owner and a key member of your management team. Include a biography of key staff, their business track record (success stories), goals, and philosophy.
The management experience section should itemize your company’s management structure. This is a place for a good business plan to provide an organizational chart, a structure description, and salary forecasts.
The description should include each management position, the person in the position, their responsibilities, and their qualifications. If you have a Board of Directors, list them here as well, along with any experience relevant to your business’s success.
When you decide to write a funding proposal, you should know that the donors will want to see the details of you and any business partners and management team you have.
Even if your business is a corporation and you have applied for fundings before, your personal information will be a subject of discussion with your donor.
Tim Brown
Job Title
Use this space to include a short description of this member of your management team.
Amy Smith
Job Title
Use this space to include a short description of this member of your management team.
Jeremy Jones
Job Title
Use this space to include a short description of this member of your management team.
This means they need names, addresses, and contact information on any partners you have.
Also, be ready to furnish tax returns, bank statements, and credit reports for the following pages.
Funding Request, Analysis, and Objectives
Now it is finally the time for the budget summary!
This section in the funding proposal is all about the numbers. You need to itemize the following clearly:
- why is your project necessary
- why is your company the right one to undertake this project
- why should the donor consider this proposal
Be specific.
State directly what you would like the donor to fund, whether it is the whole project or just parts of it.
Include quotes for equipment or supplies, building costs, etc. In short, it is all about being able to answer the question, “Why do you need that amount of money?”
Here is one way you can structure your funding request:
- Your current funding needs.
- Any future funding requirements over the next five years.
- How you intend to use the funds you receive.
- Any strategic future financial plans.
Be realistic.
By now, you probably have some idea of the usual size of grants from this donor for this kind of work.
Instead of focusing on the line details, rather focus on totals per year and per broader category.
Provide a picture of your financing strategy for the project, e.g., who else you are approaching, whether any money or support has already been offered and if so, how much and in what form. If the intention is to raise any of the money from the intended beneficiaries, explain the reasoning behind this and the mechanisms that will be put in place to facilitate it.
Address the cost-benefit issue, justifying the cost in terms of the benefits.
Financial Statements
This is the section the donor will spend a lot of
time looking at.
It should include:
- Copies of the tax returns for yourself personally and for your business.
- A personal financial statement for each of the managers of the business.
- Full financial statements for the business itself, preferably prepared by your accountant.
If there are any negative marks on your personal financial statement, or if there is anything about your personal finances that you need to explain, write a brief note at the bottom of your personal financial statement explaining it.
If your business is a start-up, show projected financial statements of cash flow and a pro forma income statement.
Don't forget about the equity investment!
If you or your partners put some of your own money into the business, make sure you state it here as well. It shows to the donor you are serious about the project you are working on.
Most donors want to see that the total liabilities or debt is not more than four times the equity amount.
Supporting Documents
Once you have done the hard part of writing the funding proposal, you are ready to gather the proof behind the story you have told. Remember to make it simple and straightforward for the donor to verify the information you have provided them.
Along with the business funding request letter, we would suggest attaching documentation to back up your claims:
- Business plan
- Balance sheet
- Profit and loss statement
- Cash flow statement
- Financial forecasting/projections
Be prepared for the donor to ask you for lots of other financial documents during your application process. They will need them to go a little deeper while they evaluate your profile. But you should at least prepare these since they are the backbone of the business funding proposal.
Other potential documentation may include the following:
- Relevant real estate documents
- Principals’ resumes
- Tax returns
- Letters of intent to purchase from buyers
- Advertisement and marketing materials
- Relevant training certificates
- the Annual Report
- the LFA matrix
- photographs illustrating context and/or the project
- detailed technical description of the project
- a detailed timeline
- relevant evaluation reports
- additional information about the people involved
Next Steps
Once the loan proposal is completed, consider doing the following:
- Make sure to proofread it and double-check for all requirements
- Get familiar with all the deadlines - from submission to the outcome
- If needed, suggest a follow-up meeting to discuss your application in person
- If your lender is likely to approve your business loan on the spot, add a digital signature box to your proposal