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Investment Memo Template

An investment memorandum typically includes key details about a business seeking investment funds. It is usually 5-7 pages and covers: an overview of the business, the investment rationale including the market opportunity and team, proposed investment terms, plans for board governance, potential investment risks, and an exit analysis. The memo draws data from sources like the business plan and due diligence to make the case for investing in the company.

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13K views2 pages

Investment Memo Template

An investment memorandum typically includes key details about a business seeking investment funds. It is usually 5-7 pages and covers: an overview of the business, the investment rationale including the market opportunity and team, proposed investment terms, plans for board governance, potential investment risks, and an exit analysis. The memo draws data from sources like the business plan and due diligence to make the case for investing in the company.

Uploaded by

ramanamurthyr
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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JWBT534-Memotemp JWBT534-Ramsinghani June 30, 2011 1:56 Printer: Yet to Come

Investment Memo Template

typical investment memorandum is used to memorialize the investment


A rationale. The data points are gathered from various sources (business
plan, market studies, due diligence calls). Such a memo is typically about
five to seven pages in length and covers key data points as follows.

I. Overview
 Brief business overview

 Stage and status of the company


 Investment amount sought

 Syndicate partners, if any

II. Investment Rationale


 Market need/pain points

 Competitive forces and their inability to address key opportunity areas


 How the proposed opportunity addresses the market pain
 Market segments and growth areas

 A strong management team with venture experience


 Financial: capital needs to reach break-even; future rounds anticipated

III. Investment Terms


 Amount of investment
 Pre-money valuation
 Preferences

 Liquidation
 Anti-dilution
 Right of first refusal

IV. Board and Governance


 Size of board

 Participation on committee: audit committee, compensation


committee
V. Investment Risks
 Technology—proof of concept
 Market adoption
 Scale-up

 Management

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2 INVESTMENT MEMO TEMPLATE

Financing/future capital needs


Competition/regulatory
VI. Exit Analysis
 Rationale and universe of acquirers

 Comparable analysis: public markets and private companies


 Projected IRR calculations

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