The message of the story – get the executive summary correct.
An exec summary is a 2-5 page overview of the important points in the actual strategic plan.
Typically an investor will examine the executive summary and gauge whether the opportunity and this investment really makes sense, whether management look like they know what they are doing, and has been completely thought through. Is this business realistically going to exploit the stated opportunity? They’ll also want to conclude that the timing in the venture is appropriate – not too late & not too early. Cosmetically, the plan on the whole must be clear, succinct where it needs to be and broken down where appropriate.
Keep in mind the business idea does not have to be a paradigm shift, simple could be best and so wherever it isn’t do not allow it to be any more complicated than it has to become.
To arrive on the above conclusions, a excellent executive summary would include the following – and this really is as significantly a guide for what a great proposition appears like as what ought to be integrated in the executive summary:
1) The issue should be stated clearly, how large the issue is and that this problem is fitting for a business answer – after all not all problems in the planet ought to attract a business answer.
2) The market must be developing and be big enough for an expense opportunity to make feeling. Investing in the shrinking market isn’t an attractive proposition. Further, the expense will make much more sense when the industry discuss targeted isn’t a material share from the overall industry eg <5%, and still results in an attractive return for that investor.
3) The solution to the issue should be formidable and covered against the opposition, through a competitive edge, or trademarked protection all of which imply the services or products will be outstanding, which is essential. Additionally we must have a wide-ranging overview from the opposition and what they have achieved and are likely to achieve.
4) To be given uniqueness, the executive summary should state what the value proposal is to the final client, and determine that end consumer, and qualify the group targeted.
5) The management team should be introduced quickly (and in much more detail in the investment proposal, illustrate why their background is appropriate for the business, and if they have not come from the industry, show their motivation to seek suitable guidance.
6) The summation should demonstrate robust financials, with a return 5 to 10 times within a five year time period and note that repeat revenue decreases risk
7) The valuation should be reasonable – thought should be paid to business standards – do this carefully as this what an investor will do. If there is one flag against management and entrepreneurs that often causes discontent it’s extreme valuations by entrepreneurs. It does nothing for management standing.
An exit must be stated, ideally with a selection of specific strategic partners cited. So if you are seeking to be acquired…who are you ideal targets
If all these points were included within the business plan executive summary, displayed clearly and concisely and made logical sense, an entrepreneur should expect strong results, subject of course to the proper numbers falling out and matching the investors expectations.
Visit the Venture Capital Centre at www.VentureCapitalCentre.com.au for information and resources on Venture Capital Tools
Additional Links:
Venture Capital Business Plan Brisbane
When Raising VC For Your Business The Numbers Don’t Lie
Venture Capital Business Plan
Venture Capitalist Australia
Tags: Business Plan, Business Plan Executive Summary, Executive Summary, Venture Capital Business Plan