1 The Executive Summary “Begin at the beginning,” the King said, gravely, “and go till you come to the end; then stop.” LEWIS CARROLL Alice’s Adventures in Wonderland READ THIS CHAPTER LAST! This admonition is like saying, “Don’t open this package until Christmas!” You are, right this minute, ignoring me and reading this chapter anyway. Fine, but when it comes to writing your busi- ness plan, write the Executive Summary last. Typically, investors will read the Executive Summary first; nevertheless, it is the section you want to write last. It is the hook that pulls readers into your net, and it must represent your future plans precisely. The Executive Summary is the place where you tell readers what you’re about to tell them. Am I confusing you? Remember that old advice about writing term papers: “Tell them what you’re going to tell them; tell them; tell them what you told them”? You do the same thing in the Executive Summary. It is a condensed ver- sion of the rest of your proposal. This is not a term paper; this is your life. The beginning of your business plan is the section about your film (or films, if you are starting a multifilm company). You give a brief overview of the people, the products, and your goals. In the rest of the sections—Company, Film(s), Industry, Markets, Distribution, Risk, and Financing—you provide more detail about how the company is going to function. The last section you write is the Executive Summary, which is just that: a summary. It presents a review of the plan for the reader. 17 18 Filmmakers and Financing WHY WRITE THE EXECUTIVE SUMMARY LAST? Developing a business plan is a process of discovery. Until you actually put your business plan together, you cannot be sure what it will contain. As you will see in reading the rest of this book, much research, thought, and skill go into a proposal of this type. The total plan is the result of everything you learn from the process, and the Executive Summary is the culmination of that full effort. The Executive Summary is written last for the same reason that you prepare a full budget before you do the top pages. You may have a problem with this comparison if you do the top pages of the budget first or if you do only the top pages. At best, filling in numbers on the top pages is a “guesstimate.” Only when you actu- ally work out the real 20 to 30 pages of the budget, based on the script breakdown, do you know the real costs. Perhaps your guesstimate will end up being right on the mark. I don’t think anyone has worked out the precise odds on that happening, but you might be more likely to win a lottery. A more probable scenario is that you will have backed yourself into a cor- ner with original numbers that are too low. The real budget will turn out to be greater than your estimate by $500,000, $2 million, or even more. When that happens, your potential investors will be extremely unimpressed. If you are not sure how their money will be spent, ought they to trust you with it? A business plan is the same situation magnified a thousand times. All the reasons outlined in the Introduction of this book for writing a business plan come into play. You may be setting param- eters for yourself that are unrealistic and that lock you into a plan you cannot carry out. In putting together the proposal, your inves- tigation of the market may cause you to fine-tune your direction. Learning more about distribution—and we all can—may invite a reworking of your film’s release strategies. Even when inventing a fictional company, as I did in Chapter 11, the Executive Summary must be written last. I did not know what I was going to say in the summary until the rest of the plan was written. Although I invented the company and the statistics for the sake of an example, my Industry, Markets (except for the cats), Distribution, and Financing sections are all real. I did not know which facts about all those elements would apply to my particular situation. Likewise, until I worked out the numbers and cash flows, I could not summarize the need for cash. The most difficult task The Executive Summary 19 for many entrepreneurs is resisting the impulse to write five quick pages and run it up the flagpole to see if anyone salutes. A busi- ness plan is not a script, and you cannot get away with handing in only a treatment. Your business plan must be well thought out, and you must present a complete package. Think of this as a rule. Other guidelines are suggestions that you would be wise to follow, but this is definitely a rule. Go through the process first. By the time you have carefully crafted your document and gone through all the steps outlined in this book, you will be able to proceed with as few hitches as possible. This process has to be a cautious one, not a haphazard one. You want to be sure that your proposal makes business sense; you want to be able to meet any goals or verify any facts that you set forth. Passion does count. The film business is too hard and it takes too long to tackle projects if you do not have a passion for your story and for filmmaking. However, business facts are the glue that holds everything together in a tidy package. Investors are the second reason that you write the Executive Summary only after you have carefully devised your business plan. Before you approach any money source, you want to be sure that your project is reasonable and rational. Potential investors did not accumulate their money by chance, and they are not likely to give you money on impulse. If you appear rash and impulsive, your 15 minutes of fame will run out before you know it. Treat poten- tial investors as intelligent people, even if you are approaching the stockbroker’s favorite group—widows and orphans. They’ll have a business advisor who will read the proposal. Often an investor will ask to see the Executive Summary first whether you are making one film or forming a company. In order to present him with the summary, you have to write the entire plan first, or there is nothing to summarize. Since a crucial part of the two or three pages is going to be a financial summary, how will you do that without running out all the data first? You would be making it up, which is not a good idea. The investor will be making initial assumptions based on those numbers. You don’t want to be in the position later of saying, “Gee, we were a little off. Our budget is $5 million rather than $2 million, and the net profit is $3 million rather than $15 million.” You will have lost an investor. Besides, five will get you ten that if the investor likes what he sees in the Executive Summary, the next communication will be, 20 Filmmakers and Financing “Let me see the rest of the plan.” That person means today—now. As I pointed out above, he assumes that there is a body of work supporting your summary; therefore, the summary and the com- plete proposal have to match. You do not want to have to tell poten- tial investors that you will have the complete plan in a month. When equity investors ask for a business plan, you must have all the market explanations, facts, and figures at hand and in order. STYLE OF THE EXECUTIVE SUMMARY The image experts say that you have 30 seconds to make an impres- sion, whether it is at a job interview, in a negotiation, or at your local party place on a Friday night. Your business plan has a simi- lar amount of time. First impressions count; they will make the reader either want to read further or toss the proposal aside. Cicero said that brevity is the charm of eloquence; this thought is a good one to keep in mind. In a few paragraphs, you must sum- marize the entire business plan to show the goals driving the busi- ness, the films, the essential market and distribution factors, and the major elements for the success of the project. Each of the chap- ters in the outline has its own summary. I know that it is hard to understand this repetition; students and clients ask about it all the time. That is why I keep coming back to it. Earlier I said that the Executive Summary is the hook; you can also think of it as the bait that attracts the fish. You want the reader to be intrigued enough to read on. You need not try to rival John Grisham or Stephen King as a writer of thrillers or horror stories. You should not expect to keep readers on the edge of their seats. Simply provide the salient points in the Executive Summary: Less is more. If the Executive Summary of your plan is as long as this chapter, it is entirely too long. You can be long-winded later. All you want to do in the summary is give your readers the facts with as little embellishment as possible. Remember that this is a business proposal, not a script. LAYING OUT THE EXECUTIVE SUMMARY Follow your outline when writing the Executive Summary.