A Guide to Writing an Effective Executive Summary

Many people consider an executive summary to be a condensed version of the full-length document; in fact, it is equally important and needs to be able to stand alone.

Through an executive summary, you convince readers that they should bother to read the attached document. Since it should be no longer than two pages, it needs to be concise, compelling, and convincing. This can be difficult to achieve in so few words, meaning it’s important to know how you’ll tackle the project from the start to ensure the end result is effective.

Step 1: Decide on the Appropriate Language

Before you start writing anything, you need to know who you’re addressing. This will ensure you use the right language — for instance, you’ll be clear on what terms you need to explain and when you can use acronyms. You should also think about tone: how formal or informal do you want to be? The style you use should reflect your brand voice. However, the tone you strike is likely to be different than for your marketing materials, since the audience for your executive summary is not the same as your target market.

Step 2: Grab Attention from the Start

The very beginning of your executive summary is the most important part of all. The first couple sentences need to engage readers and make them want to learn more. Again, think about who makes up your audience: what kind of information will draw them in and make them excited to hear more?

Also consider your own strengths. If you have a great sense of humor (and if it is appropriate) you could start with a joke. If there is a particular reason why you are passionate about what you do, draw on that. Alternatively, your could use a surprising statistic or a meaningful quote as your first sentence.

Step 3: Include a Short Table of Contents

After the introduction, include a short bullet list of what’s to come in the rest of the executive summary. Writing this now is a useful way to figure out what information you want to include. Just remember to come back to the table of contents once you’ve finished, as you may realize the points you want to cover work better in a different order.

Step 4: Divide the Main Body into Paragraphs

In the main body of the executive summary, you need around five paragraphs. Use whatever order feels logical for your argument.

Who You Are

Present your business as the right choice by briefly explaining who you are and what you do. This paragraph should give the name of your business and outline your purpose and mission. Mention key facts, such as where you’re located, how you operate (through brick-and-mortar store, online, or both), and the type of legal business structure (including if you expect that to change).

It may even be appropriate to include a little of your history and some details about your key team members. If you have essential roles that need filling at the company, it may be worth pointing out what you will do to find employees or partners. You can mention what qualifications and experience you’re looking for in candidates.

The Problem You’re Solving

Explain the problem your business is solving or the need you are filling. Talk about the situation now and describe how this will chance once your business has provided the solution.

Your Target Audience

Briefly describe who makes up your target market. Explain why your business has the skills, expertise, and resources necessary to solve customers’ problems.

The Competition

To justify why you are the right choice, you need mention your competitors. Talk about what they are doing and how you are different. You may be offering higher quality, lower prices, a more modern solution, or a new way of approaching the problem. Keep the fact that you’ll be satisfying customers at the forefront of your argument.

Overview of Your Financial Situation

Set projections for where you expect to be financially in the future — this could be one, two, or three years from now. If you are already in operation, describe the sales, revenue, and growth you’ve already seen. It can be helpful to present this information in a visual form, such as with a bar chart.

Step 5: Back Up Your Claims

For every claim you make, you must have the data to back it up. Perform research and use data you already have to support your claims. Facts are much more important that persuasive language when developing your argument. Just include the key findings in your executive summary — you can go into greater detail in the full document, where you should also include references to your sources.

One type of evidence to include is proof that your business is likely to be successful. You can even do this if you’re a startup and are yet to start operating fully. For example, you could show how many preorders you’ve received or your early sales numbers from a soft open or limited-time release. Even if these numbers are low, they’re better than nothing, since they demonstrate your target market is interested in what you have to offer.

Alternatively, you could back up claims by briefly describing your objectives. Such an approach is useful if the industry has a large amount of competition or if there is heavy regulation. Pinpointing milestones will demonstrate an understanding of the obstacles you face and show you already have a plan to tackle them.

Finally, you can show that you know what you’re talking about by highlighting your relevant experience. You may have held an executive position in the same industry as your current business or founded a startup in the past that became successful. A sentence or two about this is sufficient.

Step 6: Write the Conclusion

Conclude your executive summary with your reason for writing it. Most often, the purpose is to ask investors or lenders for money, in which case you need to be clear about just how much you’re looking for. Plus, the number should relate to information included in the overview of your financial situation. Make sure you explain how you’ll be using the funds, since this makes a big difference to how much risk is involved. For example, risk is lower if the investment is to fulfill orders than if you’re looking to fund product development.

In the case you’re seeking a loan from a financial institution, you will need solid evidence that you’re financially stable. This is because banks are only allowed to lend money when the business has assets to cover the value of the loan. Plus, bankers only ever agree to lend to low-risk ventures. (Bear in mind that if you don’t meet these requirements, you may still have the option of a Small Business Administration loan.) You’ll need to provide information of your own net worth (as well as the net worth of any owners of the business) and your business’s financial history, assets, and financial forecast.

In contrast, if you’re seeking funding from an investor, it’s important to give some details about the exit strategy, including timeframe. Investors are more interested in knowing they’ll be able to see a return in a few years than that your business will be a success.

If the purpose of your executive summary is not financial, end by explaining what you want from the reader to allow you to achieve your goals. Again, include a reason why supporting you will be beneficial for the reader.

Step 7: Remove Any Unnecessary Details

Look back through your executive summary to check that you’ve included just the core information. It should make complete sense as an independent document, but you shouldn’t include every detail — after all, that’s what the full-length version is for. Besides, by strategically omitting certain details, you entice readers to check out the full report. For instance, you should will have described what problem you’re solving and what will happen when it is solved. However, you should omit the fine details about exactly what action you’ll take to solve the problem.

In addition, minimize the amount of negative information you include. An executive summary should only be about what you expect (and hope) to achieve. Include the full sections about risks, downsides, and challenges only in the full document. An effective executive summary simply shows that you’re aware of risks and that you have a strategy to overcome them.

Finally, make sure that your executive summary is free from cliches and jargon. If it comes across like you’re trying too hard to impress, readers will distrust you.

The hard part is over: you’ve written your executive summary! Make sure you’ve put just as much effort into writing your business plan — or you could always go in the complete opposite direction and use the lean startup approach instead.