Writing The Winning Executive Summary I-What Do The Judges Want?
As the deadline for the 8th [email protected] business plan competition is looming near, it will be good to offer some tips for our readers on the first round of the competition. As a former participant, organizer of the Cambridge business plan competition and also a judge/educator now, I have developed the science and art in writing business plans for aspiring entrepreneurs who want to take part in this type of competitions in my own capacity. Some of these thoughts came about by my actual engagement with the investors. By no means is my advice meant to be the be-all and end-all standard for the judges, but most people could use it as a guideline in writing their summaries for the competition.
What kind of entries go into my rubbish bin?
It’s always intuitive to tell people what cannot work in such competitions. The same advice can be applied to the kinds of the companies which I am interested as an angel investor. I have heard pitches and will not bother to reply to pitches with “me-too” ideas. Here are the features in those entries which often end up in my trash can:
Something which you can do it yourself without going into this competition:
If you write an executive summary about starting an internet cafe, a restaurant, a consultancy, a chicken rice stall or etc, it is 100% without fail that your entry will not make it to the next stage. If you want to start a service startup using existing business models, forget it too. If you feel angry and disappointed with such decisions and your philosophy is that of entrepreneurship can mean the starting of small businesses, my reason to your gripe will be, “This is not the kind of entry that the business plan competition is looking out for. Since you do not understand what the market wants, why are you taking part in this competition?” In short, these businesses can be started by yourself, and I will strongly encourage that you do it yourself. I know that my co-founder, Weichang often start such businesses without taking part in such competitions. If he can do it while he was sick (with cancer at one point of time), so can those people who are healthy and wants to start their own enterprises.
Systems don’t work:
This is one that I heard from a fellow judge. If you are planning to integrate services from three different portals or build a product based on three existing patents into something that can be done by anyone, it is also out. It’s very simple to give an example on this kind of business plan. Remember the dot com bubble, when people talked about integrating web services to create online stores to sell bicycles. If that is not enough, this is what an inventor told me, “I want to create a new music player made out of a component from this company and that company.” My immediate response to him, “Do you realize that you have just infringed twenty patents from twenty MNCs?”
If your idea is still science fiction…
If you want to build a transporter (in Star Trek) or a pair of shoes that can allow you to fly, that’s also out. We want something that is innovated concurrently as our markets are moving. The business plan competition or an investment does not fund ideas, but something concrete of a product which can become a hit. The only places where such pipe dreams get funded are in your imagination.
The REAL Thing we are looking for
There are three important traits we want to see in a good executive summary. Trust me, I do Google search on some good ideas to see whether it is a “me-too” type. So, if you think that the judges just read and do no due diligence, you are going to get a cultural shock. I call this three important traits: Innovative, Sustainable and Scalable:
I have always told some students of mine to be involved in technology rather than be business people. Yes, the process is hard for a technologist but making an invention that transforms an idea to a commercializable product is something that offers a boost to anyone who takes part in this type of business plan competition. Most student competitors leverage on an inventor’s work to build their business plan. We seek innovation in the business plan competition and hence you can see that the winners are pro-technology. However, if you can innovate by changing the market landscape, you may get a chance. For example, there was an entry years back in the competition which was about selling “ba-gua” (barbequed pork) to US with an innovative marketing model. In the words of the judges, it’s only once in a blue moon that such entries get through. If you have problems in finding innovations, try the A-STAR Exploit website or INTRO website for technologies and create a value proposition. After all, entrepreneurship is also about gathering ideas and teams and creating a successful team.
Sustainability is important for a business. How does your business make money and how do you secure your customers? A lot of technologists seem to imagine their own markets. You need to show in your summary that your product is in market demand or how you can make the customers buy your product. Imagination is power only in your own mind, but market reality is something that you have to grasp.
Can your product create more products? Can your business grow into a big chain? Can your company develop into a medium enterprise and subsequently into a region company, finally into a multi-national company? It is a criteria which the judges look. After all, some of our judges are successful investors who have taken companies to IPO. So, they have a sense in what kind of businesses are scalable and which ones are not.
So, now that you understand what the judges want. How do you write one? I will talk about that in the next article.
[to be continued…..stay tuned]
Bernard Leong is currently an adjunct assistant professor at the National University of Singapore (NUS). He sits on the steering committee for the [email protected] business plan competition, and he is also the founder of [http://www.sgentrepreneurs.com]. To learn more about the [email protected] business plan competition, please visit [http://www.startup.org.sg]