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Chapter 2: Executive SummaryIf Yogi Berra were asked to write an executive summary, he would probably pause, sigh, and reflect, "But what if I write it and no executives read it? It's deja vu all over again!"
But seriously, folks. I recommend that you skip the Yogi Berra jokes, references to your children (unless you are selling a product or service for kids), and other potential wince-isms in your executive summary. Remember: many prospective investors use the summary as a way to decide whether your plan is worth additional time-and you don't want to make them groan or feel sick on the second page. If you must be cute, save it for your appendix. (See Chapter 11 for details.)
So, now that we've set aside the bad jokes (at least for the moment), let's look at the facts. Want some incentive for writing a dynamic executive summary? Here's the reality: an outstanding executive summary is an absolutely essential element in winning investment dollars from venture capital, venture catalyst, and/or individual investor "angels" for your lightbulb lollipalooza of an idea. These folks' desks are piled to the ceiling with BrightBusinessPlans-dot-coms. And they're going to read your executive summary first. If it doesn't whet their appetite for more, you can bid a fond farewell to all your hard work!
There are two frequently used methods for writing an executive summary:
- The Write It First School of Thought, which is based on the theory that you can then use this summary as an outline for the rest of your business plan.
- The Write It Last Philosophy, which is based on the theory that you can combine sections from the preceding parts of your plan to use inthe executive summary
I recommend a third method. Do a quick-and-dirty draft at the onset. Then, during your "final flourishes" (as outlined in Chapter 11), you can smooth the rough edges, add and modify as needed, and voila! You have an executive summary fit for the grandest of poohbah executives.
What does an executive summary contain? The summary provides the reader with an overview of:
- The company mission statement and company description
- The management
- The competition
- The market and your customer
- Your product and/or service
- Marketing and sales
- Financial projections and plans
It is essential to prepare this section with care. Remember: many of your readers will glance through the summary first. If it seems like a winner, they'll continue. If not, they will simply move onto the next business plan.
One common mistake is to overwrite the executive summary, cramming in every iota of information. This everything-but-the-kitchen-sink approach might seem like the way to impress your readers.
Wrong. Bankers, venture capital firms, individual investors-all these folks have one trait in common: they value their time. You should too. So, keep your executive summary succinct and clear. Your goal is to capture your readers' attention, not drown it.
Because you are creating a business plan for an Internet business, you must also demonstrate how you will get site traffic on an ongoing basis (and why they'll keep comin' back). What I'm referring to here is the "stickiness" factor. Before you rush off to purchase a virtual version of glue, here's what I mean by stickiness. It's the features that make visitors linger at your Web site and give them reason to return time after time-in a nutshell, the qualities of your site that increase both new and return visitors.
Addressing this element helps present your site as a winning proposition for investors. And remember: if investors buy the snapshot of your vision, they'll continue. For example, in the executive summary for Grrlbiz.com, I would note our plans to offer free e-mail accounts (one way to guarantee that visitors will return: they need to check, compose, and manage their free Grrlbiz.com e-mail accounts); changing content, such as columns by experts; community involvement and opportunities for interaction, such as chats and discussion boards; and contests. But remember: this is just a first draft. Don't let the importance of your executive summary overwhelm you so much that you belabor it. Look at it as an opportunity to capture all your ideas in just a few pages.
If you can't complete all the sections (such as the financial details), don't worry. The "final flourishes" chapter is when we'll fill in all the blanks! So, although you will need to revise this section after the other chapters are finished, you'll benefit and save time later by creating this draft as a reference point.
I Cannot Tell A Lie
Here's something to remember as you write your summary and throughout your business plan preparation: tell the truth...