How To Write an Executive Summary in 6 Easy Steps
Think of the executive summary as a one-page business plan – it provides a comprehensive overview of all the elements that will make your business model a success. Since it’s likely the first impression that investors will get from your company, the executive summary is your best chance of grabbing the attention of investors.
Investors don’t have time to go through a 30-page document detailing a company that they know nothing about. Therefore the goal of the executive summary is to divulge your company’s most important info in a succinct, yet intriguing manner.
So how do you fit multiple chapters worth of information onto just one page?
Follow these steps and you will find it surprisingly easy:
The executive summary should describe the purpose of the business plan right out of the gate. Provide a short overview of your company (name, location, legal structure, type of product, and founding date) and the specific amount you need to raise to see your plan through.
Remember to be brief in this section, but if space allows consider including your business’s key milestones that will be used as a metric of your progress.
It is also of utmost importance that you make sure your business documents are free of errors and go in one clear direction that investors can easily follow. When in doubt, hire an experienced editor who will treat your vision as if it was his own. Remember that first impressions count, and your business plan pretty much shows prospective investors exactly what you have to offer.
2. Management Team
Most investors put a lot of emphasis on the strength of a management team when deciding whether or not a company is worthy of funding. The key to this section is to demonstrate the team’s initiative and passion for your product. Summarize the experience and expertise of each member to show exactly what they contribute to their role in the company.
3. Products and Services
The products and services section of the executive summary should be broken into two parts. The first part should describe the products or services your company plans to provide. The second should identify the competitors within your industry and how your value proposition differs.
A word of advice: Never tell investors that your product has no competition. This will demonstrate that there is either no market for your product or that you haven’t done enough research.
In this portion of the executive summary, you want to demonstrate that you have conducted in-depth market analysis and fully understand the behavior within your key customer segments. Including statistics about each segment will help prove your knowledge of customer trends. The more that you can prove your understanding of your customers the more confident investors will feel in supporting your venture.
5. Marketing and Sales
Here is where you will summarize your overall marketing plan. Explain how you will position your company to reach your key customers. Don’t forget to clarify why your strategy is the best approach. If you can get creative while operating on a shoestring budget, you will surely pique the interest of investors.
6. Financial Forecast/Requirements
To wrap up the executive summary, introduce the key details of your financial plan. Cover points such as your sales forecasts, projected expenses, and the details (use of funds & repayment method) of debt/equity financing you are seeking.
Again, keep this section short and sweet. Don’t feel pressure to point out every figure on your financial statements. Investors will request more financial details if you are successful in earning their curiosity.
To get a better idea of what an executive summary should look like, take a look at this example from a food truck business plan.
Even if you only need a one-page business plan, it’s important not to skip the process of writing a traditional plan. Working through the steps of building a full plan will ensure that you have the necessary data to back your business model. Once you have a sound business plan, organizing the information into the executive summary will be a piece of cake.