How long is an executive summary and what does it cover? Unfortunately, answering this question isn't nearly as simple as it ought to be. Depending on who you ask, you may come up with four different answers. To help you make sense of the many definitions you may have heard, I've put together a simple guide to creating an executive summary that every investor should approve of.

The Four Types of Summaries
First, let's establish what the four types of summaries are, because some of the confusion about an executive summary comes from misunderstanding the difference between the four different types of summaries you may be asked to provide. Here's my sense of the four main things we refer to as summary:

1. The Executive Summary is the first section of a written plan document. Most people use the executive summary to hit the highlights of the plan quickly--in a page or two--as an introduction to the rest of the plan. Some people who have to read business plans for a living will read only the executive summary and decide from that whether to read anything else.

2. A Summary Memo is a separate document--not part of the main business plan--frequently required as a first step in the process of raising money through outside investment. This can look and feel a lot like the executive summary section of the plan and is often cut and pasted from that, but it stands alone. Investors often expect to receive a summary memo first before they receive a full plan. Summary memos are easy to fax and send in e-mail.

3. The process of seeking investment often requires a Presentation that's like an executive summary briefing, but that usually uses slides, talking and live interaction. Presentations should never be sent by courier, faxed, e-mailed or delivered as paper in an envelope. They should only be live. Presentations are normally 10 to 30 minutes of prepared talking, plus a Q&A session that can take as long or as short as the investor audience wants.

4. The Elevator Speech is another piece in the puzzle related to seeking investment. An elevator speech is verbal with no props at all and very quick--ideally only a minute or two--but never longer than five minutes. Investors expect entrepreneurs to be able to deliver an elevator speech on command--at a cocktail party, in the lobby outside a meeting room, or in an elevator.

Focusing on the Executive Summary
Now that I've established that when I say "executive summary" I'm talking about the first section of a complete plan, I still have experts disagreeing on how long and what it covers:

  • I normally recommend a short executive summary--one or two pages--hitting the main highlights of the plan. Highlights should include company age and ownership, what it sells, to what market, how it plans to grow, how much it plans to grow, and what it needs from the reader.
  • Lately I've dealt with several other experts who like the executive summaries longer than two pages--more like 5-10 pages--so they can cover more of the main highlights. This probably means these people are reading just the executive summaries, so they want to know more in that first section so they don't have to read the full plan. I've heard this from two different investors and a sponsor of a graduate-level intercollegiate venture contest.

Know Your Audience
If you're facing the dilemma of how long to make your executive summary, I suggest you solve the problem with the writers' universal motto: know your audience. When you can, ask the reader what he or she prefers in an executive summary. You can do that more easily when developing a plan for a bank loan, venture contest, professor or for a potential investor you already know and trust. You can't do that when you're dealing with investors you don't know or haven't met.

When in doubt, I still recommend the shorter, more readable executive summary. Keeping it short and simple is always good, unless proven otherwise. Your plan can probably gain readability by the kind of focus that pulls a summary down from 10 pages to two pages. Then you should also make sure the rest of the plan is compact, and that key information is easy to find and not buried.