THE EXECUTIVE SUMMARY 47
The executive summary
As frustrating as it might seem after you spend weeks crafting the most beautiful plan
ever, busy decision-makers may base their assessment of the plan on the executive sum-
mary alone. For this reason, you should do everything possible to make this the best part
of your business plan.
In fact, the executive summary is the plan in miniature. It is not an introduction. Ideally,
it should capture all the pertinent points of the whole plan in just one page. Indeed, if
you are looking for funding you might send the executive summary to prospective inves-
tors asking them if they would like to see the whole plan (but you probably won’t – see
Chapter 12).
The summary sets the tone, determines how eagerly the document is read and encour-
ages readers to turn the page (or put the plan down if you pitch it badly). The summary
should be a credible marketing statement that sells your visions and objectives. At the
same time it must not over-hype the ideas and it should draw attention honestly to any
major risks. You will want to consider your readers. How will they interpret understate-
ment or overstatement given their cultural backgrounds, preferences and prejudices?
Hit with the purpose of the plan in the first sentence. Nascent Industries Inc
is seeking funding of $2 million in order to … . Describe who you are, what
you want to do, and what you need, including:
management team, showing how they will make the business succeed;
products or services, showing why they are special;
market, indicating your niche and unique factors;
other assets, strengths, competencies and advantages;
strategy for success;
key financial data;
funding required and how it will be spent, or the approvals required.
Do not worry too much if you cannot express everything at this stage. As you work
through this book you will tick off the items on this list and gain greater insight to
all of them. You will tighten up your description when you come back to review the
executive summary at the end of the planning process.
48 CHAPTER 3 GETTING DOWN TO IT
MegaProjects Ltd Doc no BP2011.01 30 Oct 2011 Business Plan
Executive Summary
The Directors of MegaProjects Ltd are invited to review the operating
plans for the period 2012–2014. Approval is sought for the business
TETRYLUS BUSINESS PLAN Doc no 20110136 Executive Summary
Executive Summary
Tetrylus is offering 40% of its authorised share capital for $1.25m. This
is the amount of additional funding that we need to meet orders for our
unique industrial computer system and generate net profits of $6m a year
by 2013. We are positioning Tetrylus for an initial public offering in that
year at an expected market capitalisation of $60m. This Business Plan
sets out our strategic, operating and financial ...
The Company
Tetrylus was incorporated in February 2010 with issued share capital of
$10,000. The founder, Niccolò Machiavelli, is well known for his strategic
management. He is supported by René Descartes as Head of Technol-
ogy. René is famous for his powers of reasoning and he brings important
experience from his previous post as Head of …
The Product
Tetrylus ONE is a package of computer hardware and software that re-
duces accidents in dangerous working environments and cuts the cost
of complying with health and safety regulations. Our first users include
major petroleum, mining and construction companies. They recover their
full investment in the system within ten months …
Corporate strategy
Pilot sales confirm that our strategy will be successful. There are five key
elements to our strategy …
Financial projections
Net profit is projected at … Cash flow will turn positive by month 15 and
the potential surplus will reach … Funding requirements peak at … On a
realistic appraisal … pushing the potential return on equity to …
Copyright © 2011 TETRYLUS Inc Page 5 of 20
Figure 3.2 This is what you are going to tell them
AN INTERNAL-USE
PLAN
FoR ExTERNAL USE
This concise
introduction describes
the purpose of the
plan, the offer and the
potential rewards.
The Summary then
explains:
1 Who
2 What
3 How
and
4 How much
THE EXECUTIVE SUMMARY 49
Opinion varies about whether you should write the executive summary first or after com-
pleting the remainder of the document. In practice, the answer is a definite yes on both
counts. If you have any uncertainty about what you are trying to achieve and what should
go into the plan, writing a one-page summary at the outset will help you crystallise your
ideas. There will be gaps and you might rewrite most of it later, but you should not regard
this as wasted effort. If preparing the plan is a team effort, the summary will help every-
one to work to the same goal.
If you are writing a plan for your own use, do not fall into the trap of thinking that the
executive summary says it all so there is no need to go any further with the plan. You will
learn a great deal about yourself and your business by completing the plan, using it as an
operating tool, and carrying out a review a year later to see what went right and wrong.
It is critically important to return to the executive summary when you have completed
the remainder of the plan and rewrite the summary with the benefit of hindsight.
‘Wherever you go, speak the language of that place.’
CHINESE PROVERB
If you are looking for funding, you will not get off the starting block unless
your executive summary is solidly convincing and interesting.
I know of a seemingly credible business plan prepared by one of the major
US international banks. They presented it to the chief finance officer of a major
American investment house. He rejected it without reading more than half of the
executive summary when he spotted an error of fact that was perhaps trivial. It was
unrelated to the potential success of the business, but it immediately cast doubt on
the reliability of all the analysis. Make sure that you avoid such fundamental errors.
Use journalistic tricks if necessary. If there is a useful fact that might or might not
be 100% correct, use wording that is less specific. Instead of demand is $10 billion a
year you might say:
Commentators estimate that …
Industry sources indicate that …
You can also blame somebody else, preferably somebody else with credibility. You
can also pump up your opinions:
Academic sources indicate …, although our market research suggests that
commonly accepted estimates are too high/low.
t
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