Writing Your Executive Summary

As you learned in course one, sometimes you only have a few seconds to make a first impression with investors. The same rule applies to your business plan – that's where you executive summary comes into play.

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. So in this session, we'll teach you how to write an executive summary that keeps your audience engaged.

Components of an Executive Summary

Think of an executive summary as a "trailer" for your business plan. Like a movie trailer, the tone of your summary should match your audience. For instance, you wouldn't feature spooky music for a child's movie.

As such, if your business idea is fun, unique, and geared toward a younger customer base, the tone of your executive summary can carry a more casual – but still professional – tone than if your business idea was geared toward law professionals. A good tip to keep in mind is that your executive summary should match the tone of the company culture you want to create and market you want to capture.

When it comes to the length of an executive summary, remember, it's a summary. It can be as short as one page and shouldn't be longer than 5-10 percent of the main document. The most important thing is that it should be short enough that professionals don't get lost reading it but long enough that it's complete and includes all the key components.

The essential components that must be cooked into an executive summary include:

• Hook
• Mission Statement
• Problem, Solution, & Opportunity
• Team
• Financials
• The Ask

We'll cover each component in more depth below.

Hook

When it comes to the first line of your executive summary, make it count. The hook needs to pull readers into the rest of your executive summary and ultimately your business plan. A good way to do this is to use engaging language and tone, in addition to being clear about what your idea is.

Mission Statement

Within the same introductory paragraph, you'll clearly state your business mission. Here's where you talk about your company's name, location, services, and target market. This paragraph is where you clearly state your business' concept and objectives. Be sure to focus on the main points you want readers to take away. If done right, the points should highlight your unique selling proposition that will ultimately make your business a success.

Problem, Solution, and Opportunity

The one thing on investors' minds as they skim the beginning paragraphs of your executive summary will be, "Is there a market for this?" And in the beginning paragraphs of your executive summary, it's up to you to clearly answer YES.

To do this, you'll start off by summarizing the problem your business will solve. State who your customer is and what their needs are.

Once you have clearly (and briefly) identified the problem, then it's up to you to prove that your business idea is going to solve it; your business idea has an opportunity to provide value.

Outline how your business will have a competitive edge, how there is a market for your service or product, and how this could be a missed opportunity if not executed. Whether you’re improving on an existing idea or providing something totally new, you need to prove that your business will have a standing in the market.

Team

Teamwork is the only way your dream will work. And investors will be interested to know who’s going to make up your management team. Be sure to answer the following questions in this section of the executive summary:

• Who do you plan to hire right away?
• Who will come in long-term?
• What expertise and skills will they need?
• What will each team member's role be in the company?

We’ll go into more detail on putting together your management team later in this course.

Financials

The most important thing to keep in mind for this section is to keep it both realistic and compelling. It's great to be positive but it's imperative to be accurate.

Financial data to include:

• Product and service pricing
• Start-up cost
• Ongoing expenses
• Potential revenue for 3-5 years

By the end of reading the financial data, you want it to be clear how much money is expected to come in and out of your business. This will give investors an idea of whether your business is a good candidate for an investment and how much it may need.

The Ask

Often "the ask" at the end of the executive summary is for buy-in; getting investors to back your new business idea. So when you've hit this point in the document, be clear and specific. Also, phrase it in a way that reminds investors of the business opportunity. For instance, in funding your new business with X amount, your business can be successful.

Executive Summary Do's and Don'ts

You just digested a lot. To summarize the goal of an executive summary, keep the following do's and don'ts in mind:

Don'ts

• Don't write a lengthy executive summary
• Don't write the executive summary first
• Don't write a financial summary that is unrealistic
• Don't include information that doesn't exist in the business plan

Do's

• Do use a tone and language that matches both your company culture and audience
• Do make your executive summary compelling
• Do write the executive summary in the order of the business plan

Now it's your turn! Download the attached worksheet and start outlining your executive summary.

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