How to Write an Executive Summary

Your executive summary is a marketing document, so follow these steps to sell your investment opportunity.

February 02, 2017 Resources

How to Write an Executive Summary

Every entrepreneur should write an executive summary of their business plan. In fact, it’s far more important than the business plan itself – it’s the document that determines if a potential investor will even bother to read your business plan.

And many get it wrong. Why?

Because the main goal of the executive summary is to sell.

You have 30 seconds to grab the interest of your reader. If you don’t, you’ve lost them.

This is critical to understand. As an entrepreneur, your main job is to sell your vision to your customers, to your employees, to your potential employees, to the media, to your vendors, to your partners and to potential investors.

There are plenty of business books and academic document templates that outline what you should include in your executive summary. Most have good intentions, but there’s a big difference between an academic executive summary that describes a business, and real-world executive summary that sells a business opportunity!

Remember, you have 30 seconds to grab the interest of a potential investor. Forget what anyone else tells you. Guy Kawasaki wrote about this 10 year ago, and it’s still applicable today. And it’s what we expect to see from every entrepreneur who pitches Venture51.

Download our template in Word here – Executive Summary Template

Executive Summary Template

The Hook:

This is a compelling statement of why your idea/product/company is going to be the next big thing. Make it concise and concrete. Do not lead with a product description or your team. Investors are more worried about missing out on the next big thing than about making safe bets.

The Challenge:

Clearly describe the problem that you are going to solve. Describe the pain and how you’re going to solve it. Make sure the scope of this is clear, but hold off on describing the market size.

The Solution:

Introduce your product or service here. Use straightforward language and describe exactly what you have and how it solves the problem you have identified. Outline who uses your solution and how you access them.

The Opportunity:

Describe the market here – the size, lifecycle and dynamics. How fast is it growing? What’s driving the growth? Be specific. Use unit sales and revenue metrics, but don’t be too broad; address the specific size of the niche you’re entering. Don’t describe a $100 billion market when you’re selling to a specific $250 million sector.

Your Competitive Advantage:

Do you own any intellectual property? A patent? Exclusive distribution? Clearly describe how you expect to beat your competition.

Your Business Model:

Describe your revenue model and unit metrics. What are your customer acquisition costs? Your customer lifetime value? Your unit cost of production? Your break-even point? And how will these change as your business scales? If you’re in technology, be sure to be able to explain the key metrics relevant to your product or service such as DAU, MRR, CMGR, churn and your burn rate. If you’re unsure, find out which metrics the professional investors in your space evaluate, and calculate yours.

The Promise:

You’re selling an investment opportunity, so use your financial projections to quantify what success you expect to show. Your projections should be defendable. Be wary of general hockey stick curves; you will lose credibility if they’re not believable. At the minimum, include three years of annual projections for revenue, expenses, net income or loss, unit sales and headcount.

The Ask:

How much are you asking for? List the amount that you need to achieve your next milestone. Don’t ask for too little – professional investors will expect that you’ll need twice as much as whatever you list here. Describe how you’ll use these funds to achieve the milestone.

You’ll have to fit all of this in two to three pages. And don’t forget your contact information!

Since this is a marketing document, refine the copy in multiple drafts, making every sentence count. Remove anything that doesn’t address what is outlined above or create excitement in the investment opportunity.

Download this executive summary template in Word to help you get started:

After you’ve completed your executive summary, you might want to revisit the marketing / sales portion of your business plan, or confirm that your marketing plan addresses everything potential investors will expect. Here are step-by-step instructions:

 

Find the Perfect Plan

Qlutch is free to use. Access plans, share and set reminders.

We promise to keep your email private

 

Sign Up

Qlutch is your one-stop shop for how-to guidance for the 400 most common marketing projects. Free to use online.