Whether you’re approaching investors, business partners, stakeholders, or employees—making a good first impression is essential to getting your business plan approved. There’s zero room to mess up this opportunity.
This is where a cover letter helps you.
A cover letter introduces your business plan and persuades the reader to give your proposal a read. If you craft it well, your readers will likely take your business plan more seriously.
So, what is the process of writing a crisp business plan cover letter that’s detailed enough to engage readers? In this article, we’ll cover that and also share a cover letter template to help you get started.
Let’s dive right in.
What is a business plan cover letter?
A business plan cover letter is a formal document that accompanies your business plan and introduces you and your business venture to potential investors or lenders. In other words, it’s a way to sell your business idea and show why you believe in it.
In the same way that a job seeker presents a cover letter alongside their resume to an employer to get hired, you need a cover letter to accompany your business plan to secure funding or a business loan.
Why is a business plan cover letter important?
The cover letter of your business plan serves as a first impression for readers. It’s important to get it right so that it’s easier to achieve what you want with your business plan.
Here’s what makes a formal cover letter important for your business plan.
- Sets the tone for what’s to come (the content) and helps you focus readers’ attention on important aspects.
- Helps establish a personal connection before readers dive into the details and technicalities of your business.
- Helps add a humane touch to your business proposal by weaving an engaging narrative around your business vision.
- Acts as an asset when you’re seeking investment by offering valuable information and piquing investors’ interest to read your detailed plan.
That being said, a well-written cover letter attracts and retains the right audience by explicitly stating the intent and context of your business plan.
How to write a business plan cover letter?
Before you start the process of writing a cover letter, ensure that you complete your business plan in detail. Remember, no matter how well you craft your cover letter, it won’t get you far if your business plan lacks weight.
Once your business plan is ready, follow these steps to write a good cover letter:
1. Create a header
The header of your business plan cover letter should include the following:
- Name
- Business name
- Address
- Contact information
- Date
- Name of investor and their institution
- Investor’s Address
If you’re sending the document via email, there’s no need to write a header, and you can jump straight to addressing the recipient with a formal greeting.
2. Address the recipient
Unless you don’t know the recipient’s name, don’t make the mistake of addressing them as “To whom it may concern.” It may give the impression that you haven’t researched the person you’re sending your business plan to.
And definitely don’t address them as “Dear investors.” Sounds unprofessional.
The solution? Address the recipient’s name, such as “Dear Mr. Green” or “Dear Ms. Jones.” It sets a good tone and is preferred over a generic greeting.
3. Make a strong start
The first paragraph of your letter should immediately grab the reader’s attention and pique their interest.
It should touch on the following key points:
- The intent of the letter
- Reason to work with this investor
- A funding utilization plan to scale the business
It should explain clearly as to why your business is a good investment opportunity.
In the following paragraphs, you can quickly cover details about the ownership type, legal formation, the structure of the business, company history, and any notable achievements.
Make sure you remain brief and crisp while offering this information.
4. Support your statements
Claims made without evidence don’t mean much. You need to provide some form of data or facts to prove that you’re worth the risk.
This is admittedly hard to do if you’re a startup since most startups fail. So, it’s a good idea to track the key startup metrics to assess your financial position and the overall viability of your business idea.
5. Close with an acknowledgment
The last paragraph of a cover letter should emphasize three things: your interest in working with the investor, the value of this opportunity, and the timeline of how you expect things to happen.
Once done, thank the reader for their time, express your eagerness to see their response, and request a meeting to discuss things further. End the letter with a formal sign-off.
And that’s everything a cover letter must include!
But before you start writing your cover letter, check the next section.
Tips for writing a formal cover letter for your business plan
Here are some tips for creating a good cover letter for business plans:
- Keep the letter short and descriptive, up to one or two pages.
- Use a formal, conversational tone, and avoid slang, jargon, and contractions. The easier it’s to read your letter, the better.
- Address the reader by name, and avoid using “To Whom It May Concern.”
- Mention your professional background, the competency of the management team, and how it benefits the business.
- Mention the individuals, institutions, or banks that have invested in your organization in the past.
These tips and a good design will help you create a professional-looking cover letter to keep your investors interested.
Upmetrics’ business plan cover letter template
Check out this sample business plan cover letter template you can modify and use to send along with your business plan.
[Your Name]
[Your Company’s Name]
[Your Address]
[Your Contact Information]
[Date]
[Investor’s Name]
[Investor’s Company Name]
[Investor’s Address]
Dear [Investor’s Name],
I am writing to request your investment in [Your Business Name]. We are [brief overview of your business] and believe that [Your Business Name] has great potential to be a valuable addition to your portfolio.
[Provide a brief description of your current financial situation and how you’ll use the funds]
[Mention your unique selling proposition]
Attached is a copy of our business plan, which provides more information about our company and product offerings. We would appreciate it if you could take the time to review our plan and offer your feedback. We look forward to working with you.
Thank you for your time and consideration.
Sincerely,
[Your Name].
Business Plan Cover Letter Example
Here are a few examples of business plan cover letters for your reference:
Cover letter example 1
William Cutler
Cutler and Colors Co.
132, My Street, Kingston
New York 12401
williamcutler@cac.com
February 17, 2023
James F. Miller
Miller Industries Pvt. Ltd.
1234 NW Bobcat Lane,
St. Robert, Missouri
Dear Mr. Miller,
Cutler and Colors is an emerging fashion retailer in New York City specializing in men’s garments, and we’re looking to expand to six more cities in the U.S. by the end of 2023. With your financial support, we project to double our production and strengthen our supply chain efficiency.
We believe Cutler and Colors will be a valuable addition to your portfolio. Currently, we have $220,000 of our own funds invested in the business and are looking to raise an additional $500,000. The money will be used to hire more staff, set up new stores, purchase new equipment, and advertise online.
By streamlining our supply chain, we intend to undercut our competitors and offer high-quality garments at an affordable price.
Attached is a copy of our business plan which provides more information on our organization and product offerings. We would appreciate it if you could review our plan and provide feedback. We look forward to working with you.
Thank you for your time and consideration.
Sincerely,
William Cutler
Cover letter example 2
Emily Thompson
GreenTech Innovations Inc.
789 Oak Avenue, Suite 12
San Francisco, CA 94105
emilythompson@greentech.com
March 8, 2023
Robert J. Smith
Smith Ventures LLC
456 Maple Street
Denver, CO 80202
Dear Mr. Smith,
GreenTech Innovations Inc. is a forward-thinking company in the renewable energy sector based in San Francisco. We specialize in developing cutting-edge solar panel technology and plan to expand our operations to three more states by the end of 2024. With your financial backing, we aim to increase our production capacity and enhance our research and development capabilities.
We currently have $500,000 of our own capital invested and are seeking an additional $1,200,000 to support our growth. The funds will be allocated towards hiring additional engineers, upgrading our manufacturing facilities, and expanding our marketing efforts to reach a wider audience.
Our unique selling proposition lies in our innovative solar panels that boast 20% higher efficiency than the industry standard, allowing us to offer customers greater energy savings and a shorter return on investment.
Attached is a copy of our business plan, which provides more information on our company and product offerings. We would appreciate it if you could review our plan and offer your feedback. We look forward to collaborating with you.
Thank you for your time and consideration.
Sincerely,
Emily Thompson
Cover Letter Example 3
Michael Harris
UrbanEats LLC
1010 Broadway, Suite 305
Seattle, WA 98122
michaelharris@urbaneats.com
April 15, 2023
Linda K. Johnson
Johnson Capital Partners
789 Pine Street
Austin, TX 78701
Dear Ms. Johnson,
UrbanEats LLC is a fast-growing food delivery service focused on providing healthy, organic meal options in Seattle. We are eager to expand our services to four additional cities by the middle of 2024. With your investment, we plan to scale our operations and enhance our delivery infrastructure.
We have invested $300,000 of our own funds and are seeking an additional $750,000. The investment will be used to lease new kitchen spaces, hire more chefs and delivery personnel, and enhance our mobile app to improve user experience.
Our unique selling proposition is our commitment to sustainability and healthy living. We offer meals made from locally sourced, organic ingredients, which sets us apart from other food delivery services.
Attached is a copy of our business plan, which provides more information about our company and product offerings. We would appreciate it if you could review our plan and provide feedback. We look forward to the possibility of working with you.
Thank you for your time and consideration.
Sincerely,
Michael Harris
Tailor a cover letter to send with your business plan
A cover letter is the first thing an investor would read before diving into your business plan. Clearly, a lot riding on a good first impression.
Now, identify the information that is of utmost importance to your readers, and using the template above, devise an engaging summary for your cover letter.
However, if you still haven’t completed your business plan, do that first.
Let the Upmetrics business planning app help you craft compelling business plans in just about 10 minutes. All you need to do is offer some basic business details, and its AI business plan generator will quickly whip up a fresh plan custom-made for you.
Add your business plan cover letter to it, and you’re all set to get your proposals approved.
