Back to Basics: What Should Be Covered in Your Executive Summary?

Potential investors usually request an “Executive Summary” prior to meeting with new startups.  The Executive Summary is a one- to two-page document that covers the aspects of the startup that investors care about most, including the concept, the market need and opportunity, and the startup team.

The Concept

Describe in plain English what you are doing.  It is shocking how often the description fails to convey, at a basic level, what the offering is.  Describe what products or services you offer, how you will operate, who your potential customers are and, most importantly, how you will make money.  Of course, a good concept is based on a real market need and solves a real pain point or makes money for your potential customers or consumers.  How is the business concept new or distinctive?  How will it disrupt the current marketplace?  Don’t use industry jargon or acronyms that demonstrate how brilliant you are and how ingrained you are in the industry but leave readers unsure what you are talking about.

Market Need and Opportunity

The Executive Summary should discuss the potential market—preferably using data and facts and avoiding words like “huge” and “ginormous.”  What is the addressable market?  Is it large enough to support your startup, with a potential valuation in three to five years large enough to allow investors to return at least 10 times their investment?  Be realistic about what the addressable market actually is; misidentifying the market in an attempt to paint it as larger than it is conveys entrepreneur naiveté and a failure to understand the basics of your business.  For example, if you are offering software that other startups use to identify and reach out to potential investors, the market is not the total amount of money raised from venture capital and angel investors.

Include a discussion of the competitive landscape.  Who are your competitors?  What advantages does your offering have over their offerings?  What are their advantages?  If you don’t have competitors, you either don’t have a market or haven’t thought hard enough about the business.

What kind of traction have you achieved?  Have you developed defensible IP? Established a large user base?  Conducted surveys and market research to determine market need?  Identified an underserved niche that is screaming for a solution?  Established relationships with key influencers or other gatekeepers?

Team

The description of the team should consist of more than the founders’ names and current positions with the startup.  What relevant experiences does each team member bring to the startup?  Why do the team members constitute the perfect team to execute the business?  Acknowledge if you know that you have gaps on the team and elaborate on how you intend to fill them.