Executive Summary: Less is Better

Hello. This is Irino, a strategy consultant.

I will explain about executive summary.

Table of Contents in Business Plan

Executive summary
Background
Management team
Organization
Vision
Product/service
Business model
Sales/Marketing
Market/Competitors
Startup phase
Growth phase
Operations
Human Resource
Financials
Fundraising
Exit
Risk management
Project management

Do’s & Don’ts for Beginners

♦ Don’t write long.

Executive summary should be less than 3 pages long. Every entrepreneur can keep talking forever if time allows. But what it takes to be a good entrepreneur is an ability to cut what’s not important.

♦ Cover Exhaustive

Make sure your reader understand the whole of your business by reading only executive summary. Many venture capitalists read only executive summary, and do not even bother to read other sections in details. The table of contents of business plan should be covered in your executive summary.

Do’s & Don’ts for Intermediate Entrepreneurs

♦ Make a clear proposal as a financial product

How much are you going to pay back?
When are you going to pay back?
What’s Internal Rate of Returns from this investment?

Investors have many other investment opportunities from government bonds to commodities futures. You need to propose a straght answer to your investor’s question: why do I bother to choose your company among other financial products?

♦ Answer to “So what?”

Some executive summaries don’t answer to a simple question “All things considered, what’s great?”

♦ Don’t use a buz word you cannot define.

Web2.0
Finance 2.0
SOA

These buz words are for selling books by creating cognitive dissonance among readers.
These words are not appropriate for selling your company.

♦ Answer to “When?”

Some beginners write executive summary without any notion of time schedule. Prepare to answer to a question like “When can you do it?” Answer due date. Do not answer due month, which is too vague as a commitment.

♦ Don’t confuse what you will do and what you have done

Some people talk as if they’ve executed a plan already once they write it in paper. In reality, there is a huge gap between writing a plan and executing a plan.

Investors like doers, and hate talkers. Never cover up what you haven’t done.

Do’s & Don’ts for the Master Class Entrepreneurs

♦ Leave less than two keywords

To spread words of mouth, do not use too many keywords.

People are not so interested in your business as much as you are. They don’t bother to remember more than three keywords.

♦ Pitch in 20 seconds

A good entrepreneur has several versions of her business plan:
– 30 min version at meetings
– 10 min version at business plan contests
– 20 second version when exchanging name cards
– 15 second version on elevators

In reality, you don’t have many chances to pitch your business plan in elevators. But you have many chances to exchange name cards in meetings or networking events in Japan. 20 second version is the most often used and sophisticated pitch.

♦ Use episodes

All things considered, what your readers want to read about from your business plan is about YOU.

Tell them a narrative story to convince that you have what it takes to be a good entrepreneur.

♦ Share reality check with readers

Business plans hardly ever go as planned. Experienced investors know the reality. So do experienced entereprenurs. If you talk like you can do as planned, investors will judge that you are inexperienced.

What it takes to be a good entrepreneur is not an ability to write a flawless plan, but an ability to recover from innevitable setbacks So, let your investors know that you know it.

♦ Prove that you’re a industry guru

Investors don’t start the business by themselves. It’s just because you have better industry knowledges, skills, and experiences in this parcular industry. They are probably better than you in other portable skills like accounting and financing.

Prove to your investors that you are an industry star living deep in the industry.

♦ Talk contagious

Investors bother to invest in risky ventures. It’s not only for economic reasons, but for psychological reasons. First and foremost, investors want to make moeny. Deep inside their mind, however, investors wants excitement.

Investors wants to be excited when talking about it. No investor will get excited if the entreprenuer himself is not excited about it. So, talk contagious enough to pass your fever to your investors.

That’s it for today. Thanks for reading my blog.

Irino

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