Writing an Executive Summary

Key to any early stage fundraising effort is a well-crafted Executive Summary, or Exec Summary.  This succinct document describes your new venture and preemptively addresses fundamental questions that prospective investors will have.  I have read hundreds of executive summaries over the years.  And, the few good ones remain very memorable.  But, crafting a good Exec Summary is very hard.  So, this blog entry aims to help make this exercise a little less daunting for entrepreneurs.  Here goes:

First, take some time to understand your audience.  Your Executive Summary is your verbal elevator pitch.  It is a “teaser,” and its purpose is to make your reader eager to learn more.  Don’t expect to “close” with an Executive Summary – its purpose is to lure in the face-to-face meetings.  Assume your audience is smart.  But recognize your readers are also very busy.  And, while you probably know a lot more about your market opportunity, avoid being pejorative.  You need to be instructive and illuminating; descriptive but not verbose.  Carefully think about what assumptions you can and should make, and provide succinct background information as necessary.  At the end of the day, you want your Executive Summary to be (a) a quick read, (b) memorable, (c) credible, and (d) exciting.  Too much information will overwhelm the reader.  Long sentences will bore your reader.  Vagaries will annoy your reader.  Bad grammar will repel your reader.  Be succinct, clear, and compelling.

Next, start preparing an outline.  Here are the topics you must address:

  • Market Background – Give visibility into the market and where you see the opportunity. Often an industry background paragraph helps orient the reader.  Succinct objective data can be very compelling.  But, make sure you have your facts straight.  Your credibility rests on how accurately you describe the market and your opportunity.
  • Your Solution – Use this to highlight the product or service you are building and why it will address the void you see in the market. Be specific about key differentiating functionality.  This will help demonstrate the depth of your insights.  Be clear about how you foresee your product or service being uniquely valuable to future customers.
  • The Strategy – With the right product or service, describe how you plan to penetrate the market. Again, be specific.  Presumably your strategy is evolving.  Outline your hypotheses and how you plan to test those hypotheses.  Don’t be overly tactical.  But, provide enough precision so that your reader can appreciate the depth of your thinking.
  • Competition/Competitive Landscape – Educate the reader on the current solutions in the market. Be tactful about how you point out the deficiencies of these alternatives. But, avoid unnecessary bias.  Be objective, and be quantitative where possible.
  • Your Unique Advantages – This is where you discuss those unique characteristics of your venture that give you an unfair advantage. It may be some unique IP, a change in the applicable laws, the prowess of your founding team, or recent changes in the market.  The key here is to flag for the reader those truly unique attributes about your venture that enable you to be the first to capitalize on a large, perishable market opportunity.
  • Summary Financial Information – This may range from a simple summary of the significant milestones you expect to hit once you raise your round. These are the milestones that, if accomplished, position you well for raising your next round.  Or, this can be high-level projections about revenue and expenses.  The key is to shed light on how you plan to spend the money you seek to raise, and what value you will create with that funding.
  • Make Your Ask – You have the reader’s attention.  Now, make your ask.  Be sure your reader knows what you want.  “We are seeking to raise a minimum of $1.0 million.”  This will help qualify prospective investors, and bring efficiency to your follow-on meetings.

Once your outline is complete, you need to get drafting.   For many, writing is very difficult.  Don’t beat yourself up if you start spinning your wheels.  Just force out a first draft.  You can then step away for a bit, revisit and then refine.  As you write, be sure to convey your thoughts in “Plain English.”   If you are an engineer, your vocabulary may include terms that are unfamiliar with the MBA investor.  Your Exec Summary is not where you display your technical vocabulary or your fluency with acronyms.  Put your feet in the shoes of your reader – and write so that your message can be quickly understood.

Good luck, and please add your comments to this blog entry.

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