In a recent post, I gave you a rundown of the five most common types of business plans you might be called upon to write.
The shortest plan – the executive summary – is sometimes all that investors use to evaluate whether they’re interested in your company. Sometimes it’s a stand-alone document, but more often than not, it’s a short introduction or synopsis to a larger business plan. Don’t let its position at the front or its length fool you. An executive summary has been likened to a movie trailer: it may not give your audience the whole story, but it better have enough to catch their attention and get them to pay for the full-length feature.
Entrepreneur magazine suggests your executive summary be no longer than one page. If it’s longer:
“…nobody’s going to read it because it’ll be very clear … the principals are indecisive and don’t really know what they want.”
And the summary should clearly convey to the reader – in other words, the investor – exactly what you’re looking for:
“This is very important. All too often, what the business owner desires is buried on page eight. Clearly state what you’re asking for…”
The five key elements to writing an executive summary are:
1. What’s the business concept? Describe exactly what will be sold, who your target is and why your business will have a competitive advantage.
2. What are the financial features? Highlight sales, profit, cash flow and ROI details.
3. What do you want? Outline the capital you’re looking for to start or expand your business and what equity you may be providing for funding.
4. Who’s in charge? Provide information about when your company started and who the owners and other team members are.
5. What have you done lately? Offer up any details about recent achievements like patents or prototypes, test-marketing results, as well as any contracts for product development that investors might want to know about.
Click here for examples of some useful executive summaries.
Unsure about what information to include in the summary? Send us your question!
