You’ve heard about the problem with resumes. Hiring managers at major corporations sometimes receive tens of thousands resumes each year and of the resumes they actually look at, they’re only going to spend a few seconds skimming for something that catches their eye. If you’re an entrepreneur and you’re hoping to catch the eye and the checkbook of an angel investor, you’re going to face the same challenge.
If you’re hoping to pitch your idea to career angel investors, they aren’t much different than hiring managers. They have limited funds to invest and a lot of entrepreneurs with ideas of how to spend their money. Your executive summary will be one of many on their desks so you have to catch their attention with very few words. Those words are going to have to be magical!
First, understand what they’re looking for in their next investment. They want an idea that is simple to understand that solves a problem that makes sense to them. Susan Schreter, with 20 years of experience in venture capital, says to use the first four paragraphs to describe your business and how it solves a key problem in the marketplace. If it’s complicated, dumb it down. In your summary, you don’t need a lot of statistics, charts, and graphs. The purpose of this is to get them interested. Don’t make them figure out your idea. They don’t have time.
Next, sell yourself and your team. Think about what you would want to see if somebody asked you for a loan. You would probably be more interested if you knew that the people working on this product had industry experience, had brought products to market in the past, and have a proven record of success. Just because somebody has a dream doesn’t mean they can pull it off. If your company doesn’t have people like that, consider bringing experienced people on as consultants.
How about the money? They don’t want to become well read experts in your company if the numbers don’t work for them so don’t waste too much time getting to the point. How much do you need and how will it be spent? Have some 12 month projections prepared. If you’re not good with financial documents, get some help. You’re presenting to people who know numbers and any mistakes in your numbers will ruin your chances.
Finally, don’t forget to include your contact information. Schrater points out that it is all too common for entrepreneurs to pull the summary from their business plan and fail to leave their contact information. Read it, give it to others to read, and send it to them.