Letter to cousin requesting funding for new business
Dear Ms. Smith:
I am sure you remember me although we have not seen each other for a long time. I am Jack Hanson, the son of your cousin Judith Hanson, born Smith. We last met at the Smith family reunion in Atlanta, Georgia – I was still an undergrad back then with big plans. Now I have arrived at a point in my life where I believe myself ready to make these big plans reality, and in the nearest future my friends and I plan to open a small local store that will specialize in special occasion gift baskets for individual and corporate clients.
With my friends’ expertise and background and my enthusiasm I am positive that we will make our venture successful. A visit to the proposed location has convinced me that we have great opportunities ahead, and the uniqueness of our proposition will make it stand out from the competition. All we need to succeed is additional start-up capital to complement our resources. I have strong belief that if you agree to participate in the venture, we will be able to put your money to good use and bring you a nice return on your investment.
As I stated above, we plan to launch a store that will sell gift baskets for individual and corporate clients. To make our offerings even more attractive, we want to add ethnic, natural beauty products and spa quality botanicals. This will add an original touch and make our gift assortment the best in the locality. We already have a plan to make the interior design of the store fascinating and comfortable to create for our customers an atmosphere of holiday which they step in buying gifts for their friends and colleagues.
Our short-term goal is to build a reputation in the city of Bridgeport and neighboring towns; as soon as our business has the resources to expand, we will be willing to move beyond Bridgeport and possibly Connecticut. However, repayment of your investment will in any case take precedence. If you decide to invest, we can discuss several options. One is that you invest for seven years, and begin to receive interest on your investment starting with the 2nd year of the store’s operation and recoup the lump-sum after another five years. If you want to contribute for a longer time period, you will have an opportunity to share in the profit from the store for a longer time period, for instance, getting a percentage of the profit for 10 or more years.
If I were you, I would choose the latter option, because, in my opinion, the store is ‘doomed’ to succeed. First, the area is really rich in companies of different kinds, and all of them need to purchase gift baskets for their employees. Besides, I have driven around the streets for a few hours and found only two stores that could remotely be described as gift stores.
Entering them, I discovered a meagre assortment of goods that will make it really difficult for them to compete with us. Basically, local people unwilling to travel large distances have to shop for gifts in department stores like Wal-Mart or Target, and these, as you know, are hardly the best place for gifts. Besides, to differentiate ourselves from the already present gift stores, we will offer customers a modern design and additional services, such as vintage packaging for their goods, at a modest price. I rely on the experience of my friend who for five years worked as assistant manager in a gift store, and he says that the place is ideal for the venture.
Now I want to thank you for the time you invested in reading this letter. I assure you that I would not be offering you to take part in the project, did I not have deep trust that it will be a successful venture. I invite you to meet with me and my friends who want to participate and visit the place that we plan to rent for our store. We can also forward you a proposed catalog of our products at any time.
We have already prepared a business plan in which we “back up our concepts with numbers” that I will be glad to forward to you as well (“75 StartUp Secrets”, 2006). I hope that you will have a chance to evaluate all the pros and cons of this investment and decide to help us in this business. On my part, I can promise that the return will exceed any comparable return on other investment available. I will be glad to hear from you on this subject and meet in person, reviving old family ties and starting new business connections.
Sincerely yours,
Jack Hanson
References
75 StartUp Secrets. (2006, March). Enterpreneur.com. Retrieved March 27, 2006, from http://www.entrepreneur.com/article/0,4621,326420,00.html
Internal Revenue Service. Starting a Business. Retrieved March 27, 2006, from http://www.irs.gov/businesses/small/article
