Reference no: EM132841839

Unit 19 Pitching for a New Business - Pearson BTEC International Level 3, Extended Diploma in Business

Assignment - Exploring, developing and funding a micro-business start-up

Learning aim A: Explore potential ideas for a micro-business start-up

Learning aim B: Develop a business plan for a viable micro-business start-up

Learning aim C: Carry out a pitch for funding for the chosen micro-business

Scenario:

After your graduation you've decided it is time to put into practice the knowledge, understanding and skills you have learnt by becoming your own boss and setting up your own micro business. The first step to making your dream a reality is to be able to show potential investors that you have fully explored potential ideas for a micro-business start-up.

Task 1:
You need to write an evaluative report which demonstrates to potential investors that you have fully explored the potential ideas for a new micro-business start-up and internal and external factors associated with a selected micro-business start-up.

Before you write your report you need to carry out research into the potential opportunities for a new micro-business start-up. You may work in a small group to generate ideas for and research ideas for potential new micro-businesses. Evidence of the research conducted will need to be submitted in an appendix to the report itself. When conducting your research you will need to think carefully about:
• the different models for each business opportunity
• the internal and external factors that may influence the potential choice of business

Based upon the findings of the research you will need to write a report which evaluates the internal and external factors associated with a selected micro-business start-up. The report should be individually written.
The first part of the report needs to contain a description of a number of start-up ideas which you think potential investors are likely to look favourably on. As you are looking to set up a micro-business these should not require a more than 10 employees. For each start-up idea you should include:
? details of the activity the start-ups are involved in,
? their processes,
? their organisational form.

In the second part of the report you should choose the idea that you think has the best potential to succeed. For this idea you need to evaluate the significance of at least four factors associated with the start-up of the new microbusiness will be covered (including both internal and external factors) and the extent to which these could pose a risk to the new business.

Checklist of evidence required: A written report to potential investors including appendices of research findings.

Task 2:

You've decided on an idea for your micro-business and are excited to get the idea off the ground. Before you can do that you need to develop a business plan and secure funding to support you in turning your idea into a successful micro-business.

In order to get enough funding for your chosen micro-business idea you need to carry out a pitch to local business angels. You will need to convince them that the idea for your micro-business is not only needed but that you have also considered the various risks that might impact on how successful your micro-business will be.

Developing the business plan
You will need to begin by developing a business plan for the start-up of your new micro-business. You may work in a small group (up to 4) to conduct the research required to inform the plan for the micro business, but the plan that you submit will be your own individual work and should demonstrate that you understand fully what is involved in setting up your micro- business. Your plan should include the following key aspects:
o Market analysis and planning
o The consideration of any legal requirements on the business
o Consideration of any financial aspects such as pricing policy, sales forecasts, projected costs, break even and cash flow forecasts, forecasted opening and closing statements of financial position and capital structure, and a forecasted income statement for the trading period

Pitching for investment
You will then formally present a pitch in which you will evaluate the plan for the micro-business and justify your conclusions. During the pitch you will explain the idea for your micro-business and evaluate the plan for the microbusiness. The pitch should include clear conclusions of how successful you see the business being based on the analysis of both the marketing and financial planning.

You should provide the audience with documentation and materials that are detailed, appropriate and related to the individual business proposal. Throughout your pitch it should be clear that you have already considered potential questions from investors including risk, expectations for return share ownership and voting rights, as well as the percentage of shareholding and control you are willing to give up in return for investment. Therefore, you will be ready to demonstrate the ability to negotiate with potential investors to get the best deal in return for their investment.
Potential investors will also be expecting you to be professional and business-like both in terms of your presentation skills but also your behaviour and conduct.
Reviewing the pitch
As part of the pitch you should invite potential investors to give feedback on the viability of your business plan as well as the quality of your presentation of the pitch. You should use this feedback to produce a written review of both the effectiveness of your presentation and the viability of your idea.

Checklist of evidence required: A written report to potential investors including appendices of research findings.
• Individual business plan documentation for the micro-business.
• Video recording of the business pitch
• Accompanying resources used as part of the pitch (e.g. presentation slides including speaker notes, props, handouts)
• A written review of the presentation and business plan.
• Observation record produced by your assessor commenting on your ability to demonstrate individual responsibility and effective self-management in the preparation, delivery and review of the presentation of a high quality pitch.