The executive summary is for the start-up what the CV is for the job applicant.

The executive summary is the most important plan of the business plan: 

1) two pages  to sell your idea to a potential investor. 

2) 30 seconds to grab the investor's interest.

3) You need to be clear, simple and compelling.

I have read many articles and books about Executive Summary but the best one I have ever read is this post by Guy Kawasaki. You can even get it in pdf.

For those who don't know Guy, he is managing director of Garage Technology Ventures, a seed-stage and early-stage venture capital fund.

Here I will try to summarise his Executive Summary How-to:

Executive Summary

Objective: sell your idea to a potential investor

Length: "You should be able to do all this in six to eight paragraphs, possibly a few more if there is a particular point that needs emphasis. You should be able to make each point in just two or three simple, clear, specific sentences. This means your executive summary should be about two pages, maybe three."

Contents:

Component	Description
The grab	The most compelling statement of why you have a really big idea.
The problem	You need to make it clear that there is a big, important problem that you are going to solve
The solution	What is the solution to that problem?
The opportunity	Market segmentation, size, growth, dynamics and above all your target in this market
Your competitive advantage	What makes your different from your current or future competitor's?
The business model	How specifically are you going to generate revenues, and from whom? Why is your model leverageable and scalable?
The team	Why is your team uniquely qualified to win?
The promise ($$)	Your fundamental promise is that you are going to make them a win a lot of money. Show five years of revenues, expenses, losses/profits, cash and headcount.
The ask ($$)	The minimum amount of equity you need to reach the next major milestone. If you expect to be raising another round of financing later, make that clear, and state the expected amount

By the way, Guy Kawasaki also has a related article called: Is a business plan necessary?

When I studied in Bilbao, there was somebody I know who left his studies to create a company. At that time, we all laughed (maybe especially me!)

He created several companies on the Internet sector (hosting, domains). He may not have been as successful as Mark Zuckerberg but he is much more successful than many of those who laughed at that time:

Once this entrepreneur and one of those who laughed (not me) met by chance in a seminar about entrepreneurship in the Euskalduna Conference Center in Bilbao: one of them was attending the seminar and the other one was working as a waiter for a few dollars an hour. Who is who?

The first lists contains 15 commandments and the second one contains 10 commandments more.

They are all very sensible but I have highlighted my favourite commandments

15 Start-up Commandments

1. Your idea isn't new. Pick an idea; at least 50 other people have thought of it. Get over your stunning brilliance and realize that execution matters more.

2. Stealth startups suck. You're not working on the Manhattan Project, Einstein. Get something out as quickly as possible and promote the hell out of it.

3. If you don't have scaling problems, you're not growing fast enough.

4. If you're successful, people will try to take advantage of you. Hope that you're in that position, and hope that you're smart enough to not fall for it.

5. People will tell you they know more than you do. If that's really the case, you shouldn't be doing your startup.

6. Your competition will inflate their numbers. Take any startup traffic number and slash it in half. At least.

7. Perfection is the enemy of good enough. Leonardo could paint the Mona Lisa only once. You, Bob Ross, can push a bug release every 5 minutes because you were at least smart enough to do a web app.

8. The size of your startup is not a reflection of your manhood. More employees does not make you more of a man (or woman as the case may be).

9. You don't need business development people. If you're successful, companies will come to you. The deals will still be distractions and not worth doing, but at least you're not spending any effort trying to get them.

10. You have to be wrong in the head to start a company. But we have all the fun.

11. Starting a company will teach you what it's like to be a manic depressive. They, at least, can take medication.

12. Your startup isn't succeeding? You have two options: go home with your tail between your legs or do something about it. What's it going to be?

13. If you don't pay attention to your competition, they will turn out to be geniuses and will crush you. If you do pay attention to them, they will turn out to be idiots and you will have wasted your time. Which would you prefer?

14. Startups are not a democracy. Want a democracy? Go run for class president, Bueller.

15. You're doing a web app, right? This isn't the 1980s. Your crummy, half-assed web app will still be more successful than your competitor's most polished software application.



10 More Startup Commandments

1. You will have at least one catastrophe every three months.

2. Outsource effectively, or be effectively outsourced.

3. Do you thrive on stress and ambiguity? You'd better.

4. The best way to get outside funding is to be successful already. Stupid but true. But you, cheapskate, don't need money, right?

5. People will think your idea sucks. They're even probably right. The only way to prove them wrong is to succeed.

6. A startup will require your complete attention and devotion. Thought your first love in High School was clingy? You can't take out a restraining order on your startup.

7. Being an entrepreneur requires a healthy amount of ignorance. Note I did not say stupidity.

8. Your software sucks. So what. Everyone else's does also, and re-architecting is the kiss of death for a startup. Startups are no place for architecture astronauts.

9. You do have a public API, right?

10. Abject Terror. Overwhelming Joy. Monstrous Greed. Embrace and harness these emotions you must.

I found these 2 strips which are really familiar to me. Am I getting crazy, doctor?

Dilbert and Software Requirements

Dilbert and Management Problems

Spain has made a huge economic and social development since I left - quite an economical and social miracle. Some people say that in 6 months you can no longer recognize China any more because of the fast development. In my case, when I go back to Spain I cannot recognized it any more. It is so different from Spain I knew in 2002.

At the beginning when I left, I had a relative superiority complex towards Spaniards for several years. But little by little, I realized that those who stayed behind did not lose their time:

A friend of mine (from School) has just created a consulting company in the aeronautics sector. He was a very smart guy and I hope he will be successful.

Another friend of mine (from University) developed an radio simulation software and is providing consulting services to companies in Madrid. I also wish him luck.

These two stories just make me feel I cannot afford any more not trying it.

The Global Startup
Erika Brown, 11.29.04

Tech entrepreneurs and venture capitalists are creating multinationals before they even make a nickel.

Well.... I am not in Silicon Valley. I am here in Hong Kong and I must say that in 2008 and feel like staying in here in the Pearl River Delta (HK, Shenzhen, Guangzhou, Macau...).

From the very beginning, I thought of a global approach for this start-up. This global approach has three legs: Europe, China and US. We already have one leg in Europe, another in China. Now we need a leg in the Silicon Valley.

Recommended books about Business Plans

Other books

A good place to find out this is by using SimpleSpark.

As you all know, Google, the indisputable winner in the Web search engine sector (and beyond), came, in fact, years after search engines were popular on the Internet. However Google won the race. Why? Maybe because their page just had what the user wanted: a field text and a button  and nothing more. Or maybe because of something else.

History of Search Engines

This is why today I wanted to make some research about the history of web search engines since the beginnings to the web bubble. I am not including the new search engine initiatives in the web 2.0 era

• 1993:
  • MIT student Matthew Gray created World Wide Web Wanderer. It was initially used for counting Web servers to measure the size of the Web.
  • Martijn Koster created ALIWEB (Archie-Like Indexing of the Web). ALIWEB allowed users to submit their own pages to be indexed.
  • Excite was introduced by six Stanford University students. It used statistical analysis of word relationships to aid in the search process.
• 1994:
  • EINet Galaxy (Galaxy) was established in 1994 as part of the MCC Research Consortium at the University of Texas, in Austin. It was eventually purchased from the University and, after being transferred through several companies, is a separate corporation today.
  • Jerry Yang and David Filo created Yahoo. It started out as a listing of their favorite Web sites. What made it different was that each entry, in addition to the URL, also had a description of the page. Within a year the two received funding and Yahoo, the corporation, was created.
  • WebCrawler was introduced. It was the first full-text search engine on the Internet; the entire text of each page was indexed for the first time.
  • Lycos introduced relevance retrieval, prefix matching, and word proximity in 1994. It was a large search engine, indexing over 60 million documents in 1996; the largest of any search engine at the time. Like many of the other search engines, Lycos was created in a university atmosphere at Carnegie Mellon University by Dr. Michael Mauldin.
• 1995:
  • Infoseek went online in 1995.
  • Alta Vista also began in 1995. It was the first search engine to allow natural language inquires and advanced searching techniques. It also provides a multimedia search for photos, music, and videos.
• 1996
  • Inktomi started in 1996 at UC Berkeley.
• 1997:
  • AskJeeves was launched
  • Northern Light was launched
  • Google was launched in 1997 by Sergey Brin and Larry Page as part of a research project at Stanford University. 
• 1998:
  • MSN Search and the Open Directory were created.

Conclusions

In a nutshell Google was one of the last search engines created but they were the winner of the race. Why?

Does it mean that entrepreneurs should not be so afraid of making something, which is not really new?

In my previous post, I discuss the principles to follow in order to become a billionaire: one of them is "Copying pays better than innovating".

---

This post is based on "A brief history of search engines" by Lee Underwood

Related post: The myth of the great idea

How to be a Billionaire: Proven Strategies from the Titans of Wealth by Martin Fridson

                   Buy it in amazon!

Diane makes a comment that I find very true:

"Almost all of the men profiled [in the book]– Bill Gates, Warren Buffett, Wayne Huizenga, and Sam Walton, to name a few – were not motivated by a desire to become wealthy; instead, they were motivated by the accumulation of wealth. Most, in fact, kept their modest lifestyles even after they passed the billion dollar mark. In short, they were fascinated and motivated by the process, not the result."

Furthermore the book argues that most billionaire profiles tie back in varying degrees to the following nine strategies:

• Take monumental risks
• Do business in new ways
• Dominate your market
• Consolidate an industry
• Buy low
• Thrive on deals
• Out-manage the competition
• Invest in political influence
• Resist unions

And basic principles:

• Pursue the money in ideas
• Rules are breakable
• Copying pays better than innovating
• Keep on growing
• Hold on to your equity
• Hard work is essential
• Use financial leverage
• Keep the back door open
• Make mistakes, then learn from them
• Frugality pays
• Enjoy the pursuit
• Develop a thick skin

Aslo seen in Spanish in: El blog Salmon 

There is a classic post about business ideas written in 2005 by Ramit Sethi called the myth of the great idea. Ramit is one of the founders of PBWiki, which recently raised 2 million USD.

Most people say they"ll become entrepreneurs once they find a great business idea. But according to according to Ramit's that's a great myth because even the grandest ideas won't make your start-up successful. Success comes from a basic idea executed amazingly well.

Here I post a schematic skeleton of Ramit's article made by Alvin Lai

• Waiting for Great Idea
  • Excuse for not doing anything - dangerous!
  • Waste time
• Success
  • Never comes from mind-blowing idea
  • Comes from a basic idea executed amazingly well
  • Rarely found by thinking
  • Are found by doing
• A great idea is a myth

• Now what?
  • Do better than most people
  • Stop searching and start doing
  • Identify a broad, high-level goal - an industry, lifestyle or financial outcome
  • Identify things you like and dislike - be brutally honest
  • Identify opportunities that open up more doors in the right area
  • Avoid jobs/projects/opportunities that lead to dead ends
  • Take multiple steps to reach a goal
  • Eliminating choices
    • Chalk up now-I-know-I-don't-like-that category
  • Start doing
    • Finding the right people to talk to
    • Finding out what people actually need
    • May be lacking in style, but doesn't matter
  • Remember
    • The Myth of a great idea is a great way to think yourself into oblivion and failure
  • At our age
    • Nothing wrong with not knowing what we want to ultimately end up doing
    • Stop feeling guilty
    • But there's something ENTIRELY wrong with not actively trying to find out exactly what we want.
    • Trying, not waiting.
    • Experimenting, not "thinking about it"
    • Give it a shot.

Of course, this does not mean that we have to stop trying to find an idea for our start-up. We need to find an idea and we will continue discussing about it in globthink: the diary of our start-up

A very good teacher of mine, while at University, used to say:

"In any project there are two phases: the euphoria phase and the depression phase. When you are in the euphoria phase, be prepare for the other one"

I am remembering him just now..

The video is in Hebrew with English subtitles: