LITMIR.BIZ

      Step

      EXECUTIVE SUMMARY

      Your Executive Summary is the single most important part of your business plan—particularly if you are seeking outside funding. Busy investors and lenders start reading here and use the Executive Summary to get an understanding of your business quickly.

       KEY TO SUCCESS

      First Things Last!

      Even though your Executive Summary comes first in your business plan, you’ll find it much easier to prepare—and much more compelling—if you write it last. Once you’ve completed the rest of your plan on the pages that follow, you’ll find it much faster to come back and produce this section.

      In fact, some investors ask entrepreneurs to first send only their Executive Summary and financial statements (Step 9). If they like what they see, they’ll request the full plan. So if you can hook your readers here, they’ll ask for more. Your goal is both to summarize the major components of your business and to make your readers want to learn more.

      This doesn’t mean you can misrepresent your business. As in all parts of your business plan, the information and data you present in your Executive Summary must be truthful. But you can, and should, focus on those aspects of your business that show it in the very best light.

      Your Executive Summary provides a brief snapshot of your business. Highlight the most important facts and concepts from your full business plan as concisely as possible. When completed, your Executive Summary will answer these questions for your readers:

       Visualize your reader

      As you create your Executive Summary, ask yourself, “Who’s going to read my business plan?” You can improve your chances of getting a positive reaction if you keep your potential business plan reader in mind as you write.

      Remember, your reader is only going to spend a few minutes on your Executive Summary. They’re going to hone in on the issues that concern them most. If you understand their priorities, you’ll be better able to craft it to push just the right buttons.

      Do some homework to discover the interests and concerns of your likely business plan reader. Then put those issues near the top of your Executive Summary. A venture capitalist might want to see that you have groundbreaking new technology, and an angel investor might want to see that you’ve identified an easily reached target market, while a banker wants to know that the company owners are investing their own money in the business. Give more emphasis to those aspects that concern your reader most.

      QUICKTIP

      What Sets You Apart?

      Think about the number of business plans your readers must plow through each day, especially if they’re investors or bank lenders. (An average venture capitalist, for instance, usually sees about 1,000 plans a year.) What distinguishes yours from the rest of the stack? Early on in your Executive Summary, highlight the qualities that set you apart from all the other businesses. Put your winning concept up front and make sure your readers get it.

      Of course, you might not be able to identify the particular person who’s going to read your plan. In that case, you can focus on the type of person and their concerns. For instance, a banker is likely to look for aspects of your business plan that minimize risk, since they want to make sure their loan will be secure. An investor, on the other hand, looks for aspects that increase the chance that your company will grow large, since they will get a piece of the action. Refer to the interviews with investors and lenders in The Experts Talk on pages 168-182 to get a better idea of how each type of reader reviews business plans.