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Write the Right Kind of Business Plan

If you are searching for funding, whether from venture capitalists, angel investors, bankers, or even friends and family, one of the first requests you’ll receive is this: “Send along your business plan.” Before you hang up the phone or acknowledge the e-mail, you may want to ask one question: What kind of business plan do you want me to send?

Business plans come in several forms, and before you start writing a 35-page document, you may want to determine whether a one- or two-page summary might do the trick, or vice-versa. Just keep in mind that whatever type of document you send, it must do more than simply describe your business—it must also sell you and your business and convince the backer you have what it takes to make the business succeed over the long term.

Here are the five most common types of documents that can fill a request for a written business plan, from most basic to most involved.

1. An executive summary

An executive summary is essentially a business plan in miniature and shouldn’t be longer than two pages. That means it should cover the main components—the strategy, the management team, the market, the product or service, the sales plan, and the finances. But it must go beyond simply addressing these issues in factual format like an abstract or an outline, as if hitting items on a list. It should integrate them in a cohesive and convincing way that interests and stimulates the investor candidate.