24 May Your Executive Summary Should Make Good First Impression
If you’ve taken all the steps to put together a thorough business plan, you probably feel as though the task is finally complete. But don’t rest yet. You still have too put together an equally effective executive summary.
The executive summary of your business plan can be one of its most important components and is often the first thing potential lenders, investors and business partners will see. Make sure your executive summary puts the best foot forward for your business. Here are some tips:
Get the Basics Out of the Way. Keep your introductory paragraph brief. Provide company basics, such as the name, location, industry segments, and products/services offered. You should also make a statement about what stage of development the company is currently in. .
Introduce your Leadership. Experience of your management staff and advisors are a key selling point for your business, but the executive summary is not he place to cover everyone’s life story. Limit information to the CEO and perhaps one or two other key leaders.
Sharpen the Focus. Emphasize three to five important takeaways for an investor, lender or potential business partner. Emphasize a few significant themes that present your company as an excellent investment opportunity. Try to carry these themes throughout.
Explain your Business Model. Potential investors will want to know how your business intends to build revenue. Make the answer easy for them. Make the answer obvious by describing your business model in the executive summary. Also, describe your revenue streams and rank them according to anticipated relative contribution to overall total revenues.
Outline your Marketing Plan. Describe your target clients and how you intend to reach them. Highlight marketing innovations. Explain how your marketing strategies will position your company for rapid, aggressive revenue returns.
State your Competitive Advantage. Clearly state factors that set your company apart and be specific. Is your company the first to enter a a new market? Are your production costs somehow lower than your competitors? Whatever has given you an advantage in the marketplace should be stated clearly.
Be Upfront with your Capital Needs. There’s no reason to be vague about your need for capital. Use specific numbers and relate them to what your company will be able to accomplish with adequate funding. You should also describe a proposed distribution schedule if your plan is to receive capital in stages rather than all at once.
Provide a Snapshot of Financial Projections. Don’t restate all the details. Instead, include a table showing key categories, such as revenues, operating costs, and pretax profit, among others. Your potential investor or lender is going to study this area to determine how rapidly our company will reach positive cash flow. He or she will also be making a judgement call as to whether or not your assumptions are valid and realistic.
By keeping these tips in mind as you pull together the executive summary of your company’s business plan, you can help to ensure your company makes the best possible first impression with key decision-makers.