How to Write an Effective Executive Summary

Pitch First1Your business plan will be a pitchCreate your presentation firstYour executive summary is a concise write-up of your presentationIt should truly summarize your entire business planAssume it is all the investor will read

What to Cover2The contextThe opportunityYour business modelThe peopleRisks and rewards

The ContextEvery opportunity exists within a contextWhat is going on in the world to create your opportunity?There may be a gapThere may be a change occurringThere may be a problem that needs solvingWhat circumstances make your opportunity timely?

The OpportunityExplain the need/problem/demand that your business will addressHow do existing offerings by others fall short?Or, if your idea is something entirely new, why customers will want it?How large is the potential market?

Your Business Model3Value propositionValue creation and deliveryValue capture

Value PropositionYour offeringYour target marketYour basic strategy and approach to competitive advantage: why will customers want to buy this from you?

Value Creation and DeliveryYour value chain: what activities you will undertake?Your position in the value network: how will you reach key suppliers, complementors, and customersKey resources and capabilities: what do you have or are good at that enables you to deliver your value proposition?

Value CaptureSources of revenueEconomics of your business: cash flow and margins

The PeopleIdentify each team member and key advisersWhat do they know?Who do they know?How well known are they?

Risks and RewardsProjected sales and net incomeWhat are your key assumptions?What could go wrong?What will you do?How much money do you need?How will investors be rewarded?

ReferencesThe Art of the Start by Guy KawasakiHow to Write a Great Business Plan by William Sahlman, Harvard Business Review, July-August 1997The Business Model Framework by James Richardson, jamesr@hawaii.eduExecutive Summary Guide on the PACE website

Gap: Southwest airlines addressed a gap in airline offeringsChange: Netflix is taking advantage of increasingly high speed internet connections to offer movie downloadsProblem: Better Place is addressing our problem of dependence on imported oil for transportationVirgin AtlanticVirgin Galactic