It has become somewhat hip to claim you don’t need a business plan when you’re starting out.
However, nothing could be further from the truth, especially if you want to borrow money, whether it’s from the bank, an angel investor or your brother-in-law. But even if you, like most startups, are self-funding, you need to lay out a road map. Before you sweat writing scores of pages, concentrate your efforts on the most important part of the business plan: the executive summary.
This is your first chance to make an impression, so you better be, well, impressive.
People are busy, so get to the point. And style your language to the potential investor. Does your plan need to take a formal tone (banker) or a more casual yet professional one (family member)?
Dave Lavinsky, founder of Growthink, a consulting firm that’s written more than 2,000 business plans for clients ranging from entrepreneurs to multinational corporations and nonprofits, says there are three keys to writing an effective executive summary:
1. Concisely describe what your company does in the first paragraph of your executive summary, or investors and lenders won’t read any further.
2. Explain why you are uniquely qualified to succeed. Is it your intellectual property, management team’s unique and/or extensive background, early (standout) accomplishments, key partnerships, favorable market trends, etc.?
3. Include a summary financial table. Be clear about how much funding you need and what your “topline” five-year income statement looks like (show revenue and net income projections for the next five years).
Find more help from the Small Business Administration, which offers step-by-step articles to help write an effective executive summary and business plan. Also, download a Business Plan Outline (PDF document) by SUCCESS Publisher Darren Hardy on SUCCESS.com.