When you’re starting a business, one of the first things you need to do is write a business plan. Your business plan is like a roadmap for your business, so you can lay out your goals and a concrete plan for how you’ll reach them.
Not only is a business plan essential for any business owner, but it’s also a requirement if you decide to apply for small business funding or find investors. After all, before a bank or individual hands over any money, they’ll want to be sure your company is on solid ground (so they can get their money back).
A business plan consists of several pieces, from an executive summary and market analysis to a financial plan and projections. The executive summary will be the first part of your business plan.
If wondering how to write an executive summary has kept you from completing your business plan, we’re here to help. In this guide, we’ll explain what an executive summary is and provide tips for writing your own so your business plan can start strong.
What is an executive summary?
An executive summary is a short, informative, and easy-to-read opening statement to your business plan. Even though it’s just one to two pages, the executive summary is incredibly important.
An executive summary tells the story of what your business does, why an investor might be interested in giving funds to your business, why their investment will be well-spent, and why you do what you do. An executive summary should be informative, but it should also capture a busy reader’s attention.
Why write an executive summary?
Anyone you’re sending your executive summary and business plan to is likely busy—very busy. An entire business plan is long, involved, and deals with a lot of numbers.
Someone busy wants to get an understanding of your business, and they want to do it quickly, which is to say not by diving into a complicated, 80-page business plan. That’s where your executive summary comes in.
An executive summary provides just the opportunity to hook someone’s interest, tell them about your business, and offer a clear selling point as to why they should consider investing in your business.
Your executive summary is your chance to sell your business to potential investors and show them your business is worth not only their money but also their time.
What to include in an executive summary
By its nature, an executive summary is short. You must be able to clearly communicate the idea of your business, what sets you apart, and how you plan to grow into a successful enterprise.
The subsequent sections of your business plan will go into more detail, but your executive summary should include the most critical pieces of your business plan—enough to stand on its own, as it’s often the only thing a prospective investor will read. Here’s what your executive summary should include—consider it an executive summary template from which you can model your own.
1. The hook
The first sentence and paragraph of your executive summary determine whether or not the entire executive summary gets read. That’s why the hook or introduction is so important.
In general, a hook is considered anything that will get a reader’s attention. While an executive summary is a formal business document, you do want your hook to make you stand out from the crowd—without wasting time.
Your hook can be sharing something creative about your company, an interesting fact, or just a very well-crafted description of your business. It’s crucial to craft your hook with the personality of your reader in mind. Give them something that will make your company stand out and be memorable among a sea of other business plans.
Grab their attention in the first paragraph, and you’re much more likely to get your executive summary read, which could lead to an investment.
2. Company description summary
Now that you’ve hooked your reader, it’s time to get into some general information about your business. If an investor is going to give you money, after all, they first need to understand what your company does or what product you sell and who is managing the company.
Your company description should include information about your business, such as when it was formed and where you’re located; your products or services; the founders or executive team, including names and specific roles; and any additional details about the management team or style.
3. Market analysis
Your market analysis in the executive summary is a brief description of what the market for your business looks like. You want to show that you have done your research and proven that there is a need for your specific product or services. Some questions you should answer:
Who are your competitors?
Is there a demand for your products or services?
What advantages do you have that make your business unique in comparison to others?
To reiterate, stick to the highlights of your market analysis in your executive summary. You’ll provide a complete analysis in a separate section of your business plan, but you should be able to communicate enough in the executive summary that a potential investor can gauge whether your business has potential.
4. Products and services
Now that you’ve established a need in the market, it’s time to show just how your business will fill it. This section of your executive summary is all about highlighting the product or service that your company offers. Talk about your current sales, the growth you’ve seen so far, and any other highlights that are a selling point for your company.
This is also a good time to identify what sets your business apart and gives you a competitive advantage. After all, it’s unlikely that your business is the first of its kind. Highlight what you do better than the competition and why potential customers will choose your product or service over the other options on the market.
5. Financial information and projections
In this section of your executive summary, you want to give the reader an overview of your current business financials. Again, you’ll go more in-depth into this section later in your business plan, so just provide some highlights. Include your current sales and profits (if you have any), as well as what funding you’re hoping to acquire and how this will affect your financials in the next few years.
This is also where you can explain what funding, if any, you’ve received in the past. If you paid back your loan on time, this is an especially bright selling point for potential lenders.
6. Future plans
While asking for what funding you need is essential, you’ve also got to make clear what you’re going to use that funding for. If you’re asking for money, you want the person to know you have a plan to put those funds to good use.
Are you hoping to open another location, expand your product line, invest in your marketing efforts? This final section of your executive summary should detail where you want your business to go in the future, as well as drive home how funding can help you get there.
Tips for writing an executive summary
Even if you include each part of a good executive summary, you might not get noticed. What is written can be just as important as how it’s written. An executive summary has to strike a delicate balance between formal, personable, confident, and humble.
1. Be concise
An executive summary should include everything that’s in your business plan, just in a much shorter format. Writing a concise executive summary is no easy task and will require many revisions to get to the final draft. And while this is the first section of your executive summary, you’ll want to write it last, after you’ve put together all the other elements.
To choose your most important points and what should be included in the executive summary, go through your business plan, and pull out single-line bullet points. Go back through those bullet points and eliminate everything unnecessary to understanding your business.
Once you have your list of bullet points narrowed down, you can start writing your executive summary. Once it’s written, go back in and remove any unnecessary information. Remember, you should only be including the highlights—you have the rest of your business plan to go into more detail. The shorter and clearer your executive summary is, the more likely someone is to read it.
2. Use bullet points
One simple way to make your executive summary more readable is to use bullet points. If someone is reading quickly or skimming your executive summary, extra whitespace can make the content faster and easier to read.
Short paragraphs, short sentences, and bullet points all make an executive summary easier to skim—which is likely what the reader is doing. If important numbers and convincing stats jump out at the reader, they’re more likely to keep reading.
3. Speak to your audience
When writing your executive summary, be sure to think about who will be reading it; that’s who you’re speaking to. If you can personalize your executive summary to the personality and interests of the person who will read it, you’re more likely to capture their attention.
Personalizing might come in the form of a name in the salutation, sharing details in a specific way you know that person likes and the tone of your writing. An executive summary deals with business, so it will generally have a formal tone. But, different industries may be comfortable with some creativity of language or using shorthand to refer to certain ideas.
Know who you’re speaking to and use the right tone to speak to them. That might be formal and deferential, expert and clipped, informal and personable, or any other appropriate tone. This may also involve writing different versions of your executive summary for different audiences.
4. Play to your strengths
One of the best ways to catch the attention of your reader is to share why your business is unique. What makes your business unique is also what makes your business strong, which can capture a reader’s interest and show them why your business is worth investing in. Be sure to highlight these strengths from the start of your executive summary.
5. Get a test reader
Once you’ve written and edited your executive summary, you need a test reader. While someone in your industry or another business owner can be a great resource, you should also consider finding a test reader with limited knowledge of your business and industry. Your executive summary should be so clear that anyone can understand it, so having a variety of test readers can help identify any confusing language.
If you don’t have access to a test reader, consider using tools such as Hemingway App and Grammarly to ensure you’ve written something that’s easy to read and uses proper grammar.
How long should an executive summary be?
There’s no firm rule on how long an executive summary should be, as it depends on the length of your business plan and the depth of understanding needed by the reader to fully grasp your ask.
That being said, it should be as short and concise as you can get it. In general, an executive summary should be one to two pages in length.
You can fudge the length slightly by adjusting the margin and font size, but don’t forget readability is just as important as length. You want to leave plenty of white space and have a large enough font that the reader is comfortable while reading your executive summary. If your executive summary is hard to read, it’s less likely your reader will take the time to read your business plan.
What to avoid in an executive summary
While the rules for writing a stellar executive summary can be fuzzy, there are a few clear rules for what to avoid in your executive summary.
Your executive summary should avoid:
Focusing on investment. Instead, focus on getting the reader to be interested enough to continue and read your business plan or at least schedule a meeting with you.
Clichés, superlatives, and claims that aren’t backed up by fact. Your executive summary isn’t marketing material. It should be straightforward and clear.
Avoiding the executive summary no-nos is just as important as striking the right tone and getting in the necessary information for your reader.
Executive summary examples
Sometimes the best way to learn is to see how other people are doing it. The U.S. Small Business Administration has multiple business plan examples; you can flip to the executive summary to help you write your own executive summary. For more inspiration, here is an example from Harvard Business School:
Executive summary template
After all the information we threw your way, you’re probably itching to get started. If you’re ready to apply what you just learned, download our free business plan template. Our template will not only make it easier to write your executive summary; it will also guide you in writing the rest of your business plan.
The bottom line
While an executive summary is short, it’s challenging to write. Your executive summary condenses your entire introduction, business description, business plan, market analysis, financial projections, and ask into one to two pages. Condensing information down to its most essential form takes time and many drafts. When you’re putting together your business plan’s executive summary, be sure to give yourself plenty of time to write it and to seek the help of friends or colleagues for editing it to perfection.
However, some tools make crafting a business plan, including your executive summary, a simpler process. A business plan template is a great place to start, and business plan software can especially help with the design of your business plan. After all, a well-written executive summary can make all the difference in obtaining funding for your business, so you’ll want all the help you can get.
This article originally appeared on JustBusiness, a subsidiary of NerdWallet.
How to Grow Your Small Business Startup: 4 Essential Steps
Around 90% of startups fail. And while some of those failures can be attributed to bad luck, many others were the result of poor decisions at the early stages of building the company.
But while that statistic may seem discouraging, it can also provide motivation to those entrepreneurs who are willing to follow the best practices of launching a startup and push through the various challenges that will inevitably come up during the process.
With the help of a few simple (but fundamental) strategies, you can separate yourself from the majority of other startups and give yourself a real shot of making a product that will break through and make a difference.
To help you get started, let’s look at four crucial aspects of launching a startup that you should consider.
Start with the “Why?”
The number one thing you should do when launching a new company is to ask yourself a simple question:
Why is this solution necessary?
There are millions of startups globally, and the majority of them would fail to provide a viable answer. Some just want to break into a hot market because they think that will increase their chances of success. Others believe they have a unique idea without knowing whether there’s any demand for it.
But in most cases, ideas that might seem reasonable at first glance crumble when their purpose is questioned even a little.
So, if you want to avoid pouring your heart and soul into a project only to find out that it was a waste of time, it’s a good idea to spend a fair amount of time thinking about the core purpose of your product and the effort it will take to launch it.
Most of the successful startups you might have heard in recent years started with a very clear idea of the purpose behind the company. It can be a feature that no other product in the market can offer. Or, it might be a unique process for solving a problem that will change the industry forever.
Most of the time, there’s at least a clear answer to why the startup needs to exist in the first place. If you strip away the gimmicks and the additional features, you should still be left with the core idea of what you can offer that no one else can.
Take Care of Your Employees
No matter how you decide to finance your startup, you won’t be able to go forward alone for long. And that means that at some point, you will need to figure out how you’ll take on employees and ensure that they are happy and protected.
Then, there are various state and federal regulations that determine how much paperwork you’ll need to file out, what protections you’ll need to offer, and countless other details that someone outside of the HR world has probably never dealt with.
Because of that, startups can benefit from using HR outsourcing services that can take over the entire process. The team at SnackNation recommends using services like Bambee or Workday, which provide comprehensive solutions for companies of all sizes.
These companies can offer HR consulting, benefits administration, performance management, payroll, bookkeeping, and various other services that can be a hassle to manage on your own when you’re just starting a new company and have a lot on your plate already.
Plus, it ensures that you implement the best HR practices of today and that your employees are taken care of. And that will make attracting the top talent you need for growth that much easier.
Use a Proven Website Platform
Launching a startup is impossible without a strong web presence. And that inevitably starts and ends with your website. But if you don’t have experience with building and designing websites, the entire process can be a bit overwhelming.
The good news is that with a platform like WordPress, you can have a website set up in a matter of days if you want something simple. But at the same time, the platform offers robust customization capabilities and it can get a bit confusing when picking the right ones. That’s why it’s a good idea to curate your own WordPress toolbox that includes a wide variety of powerful themes, plugins, add-ons and WordPress resources that you know would always work for your website.
In the end, you want to find fast hosting, install robust security features, and provide a seamless User Experience (UX) to all of your site’s visitors.
Designing a site from scratch can be appealing. But WordPress can give you enough versatility to get any features you need while remaining user-friendly enough to keep costs down and provide you with a simple way to get started.
As a startup owner, you will probably never run out of avenues you could pursue. Whether it’s the new shiny marketing tool or a promising networking opportunity, there will be times when you’ll want to do everything at once because that’s what could give the company the best chance of success.
But in reality, maintaining focus and clarity in terms of priorities might be the most practical choice for your startup in the long term.
By only focusing on a few things at a time, you will allow yourself to really give them time, tweaking your approach until you find what’s working. Moving on to something else is easy, but then you might miss out on incredible opportunities because you were too quick to dismiss something without giving it a real shot.
So, whether it’s a marketing approach or adding features to your product, always weigh the potential benefit against the resources it would require and against how it would impact what you’re doing right now.
Sure, at some point, you will need to cut your losses with projects that didn’t pan out. But it’s a good idea to stick with them for a bit longer than you might want to, especially if you know that it’s a sound strategy that could deliver big if you would just find the right approach.
Launching a successful startup is a dream that drives millions of entrepreneurs worldwide. But only those that follow sound business principles and are disciplined in their decision-making can expect to see success.
The strategies listed above may not be flashy, but they represent essential parts of running and scaling a startup. And sometimes, taking care of the less flashy details like HR management can set you up for exceptional results in the future.
Starting a new online business during the pandemic: Two COVID-era tales of renewal in Miami
The pandemic forced more than three-quarters of small businesses across the U.S. to temporarily close up shop in the spring of 2020, and thousands have since shut down for good.
But the COVID-19 pandemic also led to a record number of people trying to start their own businesses: 4.5 million filed new business applications in 2020, according to an analysis of U.S. Census Bureau data by the Economic Innovation Group.
And the momentum isn’t slowing. The Census Bureau says 492,000 new business applications were received in January 2021, a 43% jump over the previous month. Many more informal businesses are believed to have been created, often as side hustles, but never registered.
Few cities saw more aspiring entrepreneurs than Miami. Although new business creation was not distributed evenly across racial and socio-economic lines, green shoots of entrepreneurship popped up across the metro area, helping to bring a dose of resilience to the local economy.
[At the same time, untold numbers of existing small businesses — restaurants, neighborhood shops, salons — decided to establish a digital presence, allowing them to find new customers and take orders from beyond their immediate area.
In all, the number of digitally connected microbusinesses in Miami-Dade County rose 6.7% from 2019 to 2020, according to data from GoDaddy’s Venture Forward project, which studies the economic impact of these small online businesses. The Miami metro area, which includes the neighboring cities of Fort Lauderdale and Pompano Beach, has more microbusinesses per 100 people than any other large metro area in the country.
These everyday entrepreneurs make a big impact on their communities, with each new one leading to the creation of two additional jobs, Venture Forward data shows. Additionally, each new microbusiness per 100 people can reduce the unemployment rate by .05 percentage points.
And between 2016 and 2019, every microbusiness per 100 people that’s active online was associated with a $485 increase in a community’s household median income.
Here are the stories of two inspiring women entrepreneurs who took the initiative when the pandemic upended their lives.
Natasha Nails: Rethinking the press-on
It took a painful case of contact dermatitis, a type of allergy, following a visit to a nail salon for Natasha Williams to come up with an online business idea for the future of press-on nails.
The Miami native, who lives in Little Havana, has had her nails done since her teens.
But after her allergic reaction in March 2020, she was forced to switch to press-on nails that used hypoallergenic adhesive pads.
Unhappy with the appearance of what was available — they felt cheap and plasticky — Williams started buying clear nails and hand painting them with her favorite colors and designs.
Around the same time, the pandemic shut down the local economy. A well-known tap dance performer and teacher around Miami, Williams suddenly had a lot of time as lessons and gigs dried up.
By July, buoyed by the admiring comments she got from friends and strangers on the street, she realized there was a market for her creations, so she quickly built an online store and Natasha Nails opened for business.
At first, it was as much a hobby as a career plan. But soon she started asking questions and understanding the opportunity was real.
Why did women tend to apply press-on nails and leave them on and then throw them out? Given how easy they are to remove and reapply, particularly the adhesive-pad type, wouldn’t it be more fun and affordable to have collections of nails so they could match outfits or daily moods, the way they choose which shoes to wear or purse to carry?
“I want people to be able to mix and match, like ‘let’s see what I have in my closet to wear today,’” she says.
If she can popularize this approach, women may one day not feel obliged to suffer the daily inconveniences of wearing long nails.
“Just try typing all day with these things on,” she laughs, showing off long, olive nails. “You really can’t do much. And anyone who tells you differently is lying!”
While her new business doesn’t make enough money for her to quit her teaching, she spends about the same number of hours on both.
That includes 30 minutes each morning tending to her growing Instagram account — where she has amassed more than 5,000 followers who account for most of the orders on her website — and a few hours in the evening painting nails, including custom orders, and packaging up boxes for customers who opt for her monthly subscriptions.
Many challenges remain — particularly how to scale production beyond her ability to hand-paint nails while maintaining the artistic quality. But Williams is definitely a long-term thinker who hopes that, some day, her creations will be featured at major retailers.
“I don’t see obstacles as problems, but as challenges,” she says of the process of building a company. “You just have to follow the steps.”
Read more about Natasha’s story here.
Starting an online charcuterie-to-go
Like so many healthcare workers around the world, Maryam Kheirabi faced new demands when the pandemic hit. An oncology pharmacist with a Miami-area hospital, she suddenly had more hours, more stress and more fears of the unknown.
To deal with the growing pressure, Kheirabi decided she needed a new activity, something that would take her mind off her stressful job and give her a newfound source of fulfillment.
“I’m happiest when I’m extremely busy, and I wanted to create something beautiful for people to share,” she says. “In a way, I think the business got me through the worst days of the pandemic. It gives me hope, and hopefully it gives other people hope, as well.”
The idea came to her soon after the pandemic began, when she saw groups of friends eating from plastic containers full of snacks at a park across the street from her home for socially distanced get-togethers.
“How cool would it be to have a charcuterie box to go,” she remembers thinking. It would give people the option to pre-order a food board that could be delivered just when it was needed.
A native of Queens, N.Y., who moved to Miami with her speech pathologist husband in 2016, Kheirabi grew up being responsible for creating food platters for family gatherings.
“We Persians are very big on hospitality, and I never lost my love for creating beautiful, delicious things,” she says.
Once the first spike in COVID-19 cases began to ease in August, she started doing research, which included the creation of a variety of charcuterie platters for colleagues at the hospital.
A cousin in New Jersey agreed to help her secure a domain name and choose website-building tools.
“The rest was left up to me, but it was mostly dealing with aesthetics, which I love, anyway,” she says.
In early November, Fig & Brie officially launched, with a range of offerings, from a $20 “solo” platter to an $85 “soiree” box.
The seed capital was $2,000 that her husband, Francisco, urged her to take from their savings, with the understanding that they wouldn’t spend any more if the business wasn’t profitable after a month. She ended up spending $1,900 of it in that time, but by early December the business was making money.
Kheirabi’s digital marketing strategy initially was solely based on Instagram, in part because she wanted to grow slowly at first. But sales jumped more quickly than expected over the holidays, as friends and fans spread the word. One local real estate broker ordered platters as gifts to her clients.
It wasn’t easy, but she and her husband managed to keep up with demand while maintaining their jobs in healthcare. It helps that most orders come on Thursdays or Fridays, for delivery on Saturday.
Francisco does everything from taking photos to taste-testing to driving their only car around the city making deliveries. When he once asked what he would be paid for all his work, she quipped, “Sorry, but we pay in cheese.”
Her near-term goal is to have enough demand to hire a driver or two, and then to find a way to ship around the U.S. (That will require some innovation, to either find a way to keep fruits and veggies crunchy and fresh, or to come up with boards that meet her standards without those foods.)
Ultimately, she’d like to open a storefront in Miami and share her business model so women in other places could follow suit.
“I wouldn’t be doing this if it was only for the money,” she says. “That’s just icing on the cake.” The primary reward, other than enriching customers’ lives, is to empower women, including herself.
“We’re living in a time when women are standing up and taking charge of themselves,” she says. She even welcomes the competition from other female-owned online charcuteries in the city. “There’s enough demand to go around,” she says. “Women shouldn’t compete with each other. We should lift each other up.”
The post Starting a new online business during the pandemic: Two COVID-era tales of renewal in Miami appeared first on GoDaddy Blog.
New to Entrepreneurship: Here Are 6 Tips You Can Bank On
Entrepreneurship is not a career, it is a life choice. Many people have mind-blowing business ideas. It’s almost enticing to jump right into starting up your new business. But as fun, as that sounds, the reality of running a successful business is a lot more complicated than that.
Most times opening up a business is usually a learn-as-you-go experience, but it doesn’t have to be this way. Here are essential tips that when implemented well can be the smartest decision you will ever make for your business.
Brand Your Business
What does the term branding mean to you? Most people perceive branding as the logo, colors, and visual component that you associate your business with, but it’s a little more than that. Branding is the entire identity of the business. It is what makes your business stand out in crowds.
In a fast-growing business world, it is important to create a strong brand for your business. This way it outshines your competitors, gets people’s attention, and makes it more recognizable. Branding gives you a chance to get some control over how people perceive your business.
Build a Team
Manpower is a vital part of any successful company. It is significant for ensuring that operations are running smoothly and efficiently. Coming up with a good workforce is the secret ingredient for achieving a good relationship between your company and your customers. They are the face of the company and give an essence of the human touch to your business.
It can not go unmentioned that with improved technology manpower is rapidly being replaced with machines. That said, creating and maintaining a reasonable amount of manpower for your business can be a life-saver hack. Coming up with a team of educated and well-trained individuals will improve productivity, provide innovations, and maintain the relevance of your business in the market, something technology can’t provide.
Buy Raw Materials in Bulk
Depending on what your company’s end product is, consider purchasing the raw materials required at wholesale. Stockpiling the raw materials when they are at their lowest prices is a money-saving hack. Buying raw materials at a low enough wholesale price reduces the cost of production and in the long run, maximizes profits from your retail sales.
Consider finding a reliable wholesale distributor, this makes purchasing more efficient and you are assured of the quality of materials you will be getting. Ensure they supply within your geographical region, have prices you can afford and are trustworthy.
Advertise Your Business.
Promoting your business is a key aspect if you want to outshine your competitors and make your product or service known to your potential customers. Businesses have different ways of promoting their brands; they range from handing out flyers to postcards to brochures to advertisements in newspapers to online marketing.
Using social media platforms to promote your product or service is a no-brainer. It is the best way to get your name out there fast enough, while also providing solutions to about ninety percent of the population online searching for similar products. Some businesses opt to invest in a large indoor LED screen because of its efficiency in displaying stunning images. These types of screens are eye-catching, outstanding, and popular for their diversity in use, hence playing a major role in advertising brands.
As a business owner, take time to research which medium of advertisement will best suit your enterprise and proceed to invest in it.
Invest in Packaging
While most new business owners overlook the need to properly package their product you must seize the chance and stand out. packaging is the first touch that customers will have with your brand.
It is therefore important to create enticing packaging for your consumers that will draw attention to your brand. It is imperative to incorporate eye-catching shapes, colors, quotes, and packaging material that is unique to your brand. This will make the unpacking experience for your customers exciting and unique hence creating loyalty and enhancing customer retention. Keep in mind that with evolving people and markets, your packaging must evolve to keep up.
Be Sure to Keep Records
For any business, accountability is key. Efficient record keeping will help to keep everything in order and help to analyze your company’s financial status, provide insight into what your real profit is, answer tax problems, or keep track of deductible expenses.
Precise record-keeping of finances and expenses throughout a business’s lifespan makes it easier for you to adjust your business plan accordingly to help solicit new business partners or investors.
Even after a business picks up, managers are tempted to focus more on production and profits and overlook record-keeping, so don’t fall into this trap.
Choosing whether to keep the record in soft copy or hard copy is totally dependent on the business owner’s preference.
Let’s be honest, starting a new enterprise can be a little bit hectic because it requires a lot of planning, sacrifice, and money. That said if you have your business idea don’t wait for the right moment because it will never come. Take the leap and trust your instincts. All you need to do is apply the six tips explained above and you are good to go. Good luck setting up your new enterprise.
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