Sometimes you only have a few seconds to make a first impression with investors and that is why having a compelling executive summary readily available is vital.
The executive summary is your chance to lay out all the highlights of your business plan. Often, if an executive summary isn’t catching enough, investors won’t bother to read the rest of the business plan.
What needs to be included in a compelling executive summary for entrepreneurs that are looking to get funded?
An executive summary is a critical document for new and growing businesses. It is vital for entrepreneurs to understand how this differs from other documents, like pitch decks and full business plans. It is a crucial tool that can make all the difference in funding a venture and empowering its potential.
What is an Executive Summary?
This is a document that precedes a business plan when seeking business loans, new partners, or an early round of funding for a startup venture. This brief sums up the business plan and opportunity in a precise document.
This is key to getting more capital. Only an effective one will help you get investors to give you that next meeting.
Executive summaries are more common for traditional businesses pursuing traditional forms of financing. Such as startups raising capital, small business loans from a bank or connecting with more mature partners. However, every entrepreneur and small business should have one.
Here are a few guidelines on how to write a strong executive summary
Executive summaries need to start by the specifics.
Identify your company or business name, the contact information and the location.
You need to know that an executive summary is a short and brief review of the whole business document. The words “brief” and “review” are the main words here. The executive summary should not in any way be detailed nor should it be a substitute for the original document.
It should abide by certain styles and basic styles. Certain basic guidelines should apply when writing an executive summary.
The paragraphs should be kept short, simple and precise without leaving out any essential and important information. Executive summaries should be 1-2 pages, so keeping your paragraphs short and simple is key.
It should make sense even without reading the original report itself. It should start with what you need to capture the reader’s attention and should be followed by factors in chronological order.
When writing an executive summary use the language that is best appropriate for the target audience. It should always be kept professional and free from grammatical and spelling errors.
State the problem your business is solving. An executive summary needs a clearly stated problem. Ensure that a clear definition of the problem has been stated and it should be in understandable terms. If the problem you defined is not so convincing, you will not be able to provide a solution that has an impact.
Provide the solution. Any problem needs a solution and this needs to be addressed and including when writing an executive summary.
After you have stated your problem provide a solution. Otherwise, the problem you had first created will not make any sense. You need to provide a solution that solves or tackles the problem.
Talk about the target market. In some cases, the product you are providing defines the market. If not, you can give a short description of the target market. You should provide a realistic market potential.
Think about the major strengths and use bullet point, graphics, and headings to the present ideas. It will help the reader easily find what they are looking for.
If the information you are presenting is long, you can break it down into short, understandable bullets.
When writing an executive summary, organize the main idea in the form of a heading. This will help the reader familiarize with the summary as they get to read it.
Avoid using any claims that cannot be supported.
Categories to Include in Your Executive Summary
As this is either a follow on from your pitch deck and/or a compact version of your full plan, it will contain most of the same categories.
The Small Business Administration (SBA) recommends the following flow:
- Company description
- Market Analysis
- Organization description
- Management team
- Product line
- Marketing plan
- Funding request and use
- Financial projection
In summary, you want to pay specific attention to the problem you solve, your solution, and any traction you have so far. You can find sample executive summaries and templates from the SBA, Microsoft, and Bplans.
Once written, make sure you get feedback from a mentor, advisor or experienced entrepreneur before submitting or circulating it to avoid making any big errors. You’ve only got one shot to impress with this document.
To stay updated on the latest startup and business industry news, click here.