| An executive summary is used as a cover letter to a | | | | start a business. If you ask for too little, your business |
| business plan. Whereas a cover letter is often | | | | has no chance of succeeding. Your lender knows this. |
| discounted in its importance, the executive summary | | | | He doesn't want to see you back in six months asking |
| should not suffer that same fate. This section is the | | | | for more money. As long as you have a realistic way |
| single most important part of the business plan. | | | | of re-paying the loan in a reasonable amount of time, |
| "How can a letter be so critical?" You may ask. | | | | don't be afraid to ask for what you really need. To |
| Because it may be the only page a loan officer reads | | | | insure the comfort of your lender, your summary will |
| (if it's done incorrectly). Think of it like a movie trailer; if | | | | show a clear, realistic plan for paying this money back. |
| the trailer catches you interest, you want to see more. | | | | 3. Have solid individuals in charge of your business |
| You invest ten dollars and see the movie. If it doesn't | | | | finances. If you don't have solid financial or business |
| meet your movie-watching criteria (for whatever | | | | training and/or experience, having a Chief Financial |
| reason-it's not your kind of movie, it has actors you | | | | Officer or a CPA listed in the body of the summary as |
| don't like, the plot stinks, etc.) you invest your money in | | | | an additional contact person or company owner is |
| a different movie--one that you do like. It's the same | | | | important. Even if you have to give a small percentage |
| with bankers and businesses. | | | | of your company to the CFO or CPA it may be worth |
| Here's how you can write an executive summary that | | | | it to get the financing you need to get started. |
| will impress any loan officer: | | | | 4. Be willing to give. Your executive summary should |
| 1. Do your research. This summary, as its name implies, | | | | indicate what you're bringing to the company. How |
| summarizes information on your competitors, your | | | | much are you investing? Where will that money come |
| customers (market), and market trends. These | | | | from? What collateral is available to secure the loan? |
| numbers need to be real. The only way to get them is | | | | Lay it out in up front, so the banker knows you're |
| by doing research. If you're not sure where to start, | | | | deeply committed to the success of your business. If |
| you can get more information on doing market | | | | you're not willing to put anything into the company, the |
| research through the Small Business Administration. | | | | bank won't be either. |
| Don't try to fake out the banker. Remember, he has | | | | 5. Build anticipation. To build the lender's enthusiasm, |
| access to this information as well. | | | | make references in your summary section to what's |
| 2. Ask for a realistic amount of money (even if it's | | | | included in your business plan. |
| more than you want to borrow. In the executive | | | | Put all the information together in a cover letter format |
| summary you will ask for a specific amount of money. | | | | and you've got an executive summary that will have |
| Bankers want to see that you know what it takes to | | | | your banker wanting more. |