Investor materials explained
Pitch Deck or Information Memorandum: Which Do You Need?
If you are seeking investors, capital partners or a buyer, the simple answer is that most businesses need both.
A pitch deck creates early interest. An Information Memorandum gives a serious investor the detail they need to properly assess the opportunity.
First stage
Create interest
The pitch deck makes the opportunity easy to understand and encourages the next conversation.
Next stage
Support evaluation
The Information Memorandum provides the depth a qualified party and their advisers need to assess the opportunity.
The early conversation
What is a pitch deck?
A pitch deck is a short, visually engaging presentation designed to quickly explain the opportunity and encourage an investor to take the next step.
- The business and the problem it solves
- The product or service
- The market opportunity
- Traction and key achievements
- The business model
- The management team
- The capital being sought
- How the funds will support growth
In simple terms: a pitch deck explains why an investor should be interested.
The serious evaluation
What is an Information Memorandum?
An Information Memorandum, often called an IM, is a more detailed document prepared for investors or buyers who want to seriously evaluate the opportunity.
- The company’s history, structure and ownership
- Products, services and operations
- The industry and addressable market
- Customers, competitors and growth strategy
- Management and key personnel
- Historical and forecast financial information
- The proposed transaction or investment structure
- Use of funds
- Key risks and considerations
- Supporting evidence and important disclosures
In simple terms: an Information Memorandum provides the information an investor needs to properly assess the opportunity.
Side-by-side
The key differences
Why most businesses need both
Use each document for the job it is designed to do
Sending a lengthy Information Memorandum too early can overwhelm someone who is only beginning to consider the opportunity. Sending only a pitch deck may create interest, but it rarely provides enough detail for a serious investor to make an informed assessment.
Create interest with the pitch deck
Give potential investors a clear, compelling overview of the opportunity.
Qualify the enquiry
Confirm the investor’s interest, suitability and capacity before sharing confidential information.
Provide the Information Memorandum
Give serious parties the detail required to evaluate the business and prepare for further discussions.
Move into meetings and due diligence
Answer detailed questions, provide supporting documents and progress suitable parties toward an expression of interest or offer.
The pitch deck opens the door. The Information Memorandum helps a serious investor walk through it.
Choosing what you need
What does your business need?
If you are only having an initial conversation or testing early interest, a strong pitch deck may be enough to begin.
If you are actively seeking capital, investors, strategic partners or a buyer, you should generally have both documents prepared before going to market. This ensures you can generate interest quickly and provide detailed information as soon as a qualified party wants to progress.
Consistent and credible
Prepare your opportunity properly
The quality of your documents can influence how investors perceive the quality of the opportunity. Your pitch deck and Information Memorandum should tell the same story, use consistent figures and clearly explain what is being offered, why the opportunity exists and what the next step should be.
Investor-ready materials
Prepare your opportunity with confidence
BizDealRoom can help prepare both documents and position your opportunity for presentation to suitable investors, capital partners or buyers.