Seems like our IC memo's are so detailed and end up being 150+ pages for, at times, small check sizes. Serious overkill.
At times I can't see the practicality of such a long memo for the IC members - hard to believe that they read it all....
What do IC memo's look like at your firm?
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Jeez that does seem like overkill. Ours are 30-50 pages and even in the 50-page memos there seems to be a lot of repetitive information. I’m on the debt side though so I’d assume ours wouldn’t be as extensive as equity ICMs.
40-50, another more is serious overkill unless it's a portfolio
When I used to work on the debt side, 15-25 pages max including appendices (financial statements, etc.).
Now on the investment sales side, CIMs are about 25-50 pages max. Biggest one I've seen is 75 pages but that one had a full page picture every other page.
At my firm around 10-25 pages depending on the complexity of the deal. Anything more than 30 is overkill in my opinion unless you are hard equity and need a detailed breakout of everything. What do you even put in pages 50-150?
I've had OM's sent that are less than 10 pages lol
When I was in commercial financing, 25-50 pages depending on complexity & photos
Now at a family-owned developer, 10 pages would be long. Usually around 5
10-25 pages. If it’s 20-25 pages, it usually means there are lots of pictures.
50-60 page avg. the first 10 pages contain the vast majority of what I think is useful info. Would be surprised if people look at anything beyond that. I can’t even imagine having to get to 150
30-50 is what I had most experience with, though my latest was 60 also.
Generally 15-20.
Ground up developments up to 50.
Honestly like 2-3 pages. If you can’t state your investment thesis and summarize the risks in that amount of space you’re probably doing too much work.
Totally agree. Love that your firm does that. I think (in my humble opinion) the problem is three fold.
1) Firms feel the longer the memo, the more flushed out the thesis is.
2) Proving to LPs the firm is analyzing the investment properly.
3) Bloated middle management trying to prove their worth by increasing the number of analyses and thought processes in a memo which creates longer memos.
At my previous firm, we were acutely aware people only read the first 2 pages of the memo, and so would spend the most time here. However, it was always interesting to see the politicking at play in writing and designing the memo.
I'm a big proponent in spending your time on things that actually add value and as little time as possible on things that do not. It sounds simple, but you'd be amazed at how controversial that can be at some firms.
Ours are 40-70, and 3 or so slides get discussed. I honestly think it’d be better practice to force deal teams to summarize in ~10, then send around an IC follow-up to the extent something isn’t covered.
40-80 pages depending on deal complexity. I've seen a few push close to 100.
They are mostly a waste of time, but senior management takes the perspective that if you didn't put it in writing you must not have done the work. Always hilarious when those same people complain about the length of the writeups...
We just moved from a 15 page word doc (of pure text) to a 20 page powerpoint with one slide for summary info, one for thesis + key bets/opportunities. one for risks, and the rest is standard boiler plate stuff (aerials, financial projections, underwriting assumptions, capex budget, supply overview, rent comps, sales comps, and floorplans). We're trying to get the meat if it onto 2-3 pages. We've prescreened our markets and trust that our teams are capable of identifying good real estate (debatable since I work there...), and we've got a lot of money to put out. That means we have to do volume and can't spend 2+ days cranking on a 20+ page memo when everyone knows half the shit in there already, focus is on digging deep on the business plan and being transparent about risks, most everything else is just noise.
Ours are pretty short PowerPoints. Most of our developments are city centre office/hotel/residential/build to rent/serviced apartments. Structure tends to be:
Page 1 - image, address, opportunity summary including all key financials I.e purchase price, development costs, end values
Page 2 - information about existing building, size sqft/number of rooms if hotel etc, current use class, another image of key building elevations.
Page 3 - location map marked up with all relevant surrounding uses I.e. major office occupiers, leisure/tourist attractions etc.
Page 4 - connectivity - busses, trams, airports, train stations.
Page 5 - existing and proposed floor plans if re-use or new build plans and massing if new build.
Page 6 - any info on end values research i.e. comparable rental or sales evidence or covenant information of potential pre-let tenants, term sheet with hotel brands etc
Page 7 - screenshot of development appraisal including sensitivity analysis
Page 8 - (if sending to funders) would be funding terms sought and exit strategy.
80% is copy and paste from broker OM, so basically all the info on the local economy data, nice little paragraphs about the market. The remaining 20% is our DD for analyzing comps, underwriting, etc. So basically imagine that we gut the broker OM and delete anything related to financials/proforma and then put our own underwriting in.
70% is copy and paste from similar deal. Just update numbers and story a bit to fit thesis
From the LP side, and from two competing firms...
First firm I worked for was about 100 pages single spaced in Word. The seniors at this firm were some of the best I've known, and a decade later I still use the memos as reference for what professional institutional IC memos should aspire to be. Second firm I worked for was about 100 PowerPoint slides. The memos were like a junior high science fair project, and there is no reason to ever refer back to them.
I don't think it matters whether it is done in Word vs PowerPoint. The structure and basic content can still be the same. But if I had never worked for the first firm, I wouldn't know what I would be missing.
I think the difference is what firms leave out of the memos hoping people will miss (or expect to ask during the meetings), versus making the memos something you can use years later (either to refer back to the deal or for future ones).
Sorry - re: comment about not knowing what you were missing if you didn’t work at first firm - just curious - what type of critical information made it into the 100 page single spaced doc that didn’t otherwise get into the 100 page ppt decks? Feel like a 100 page deck is a lot of space to work
I wouldn't say it was always critical information that made it into the doc, but it was just way more detailed and included the rationale for decisions and other options and why those other options weren't used.
Seen BC Partners sent a 200+ page co-invest memo once lol. Pretty funny
That’d take at least 5 thumbs of whiskey to get thru. Fucking obscene. Whoever circulated that should be taken out back like old yeller and promptly shot in the back of the head.
At least 500 pages muhuhahaha
~30 pages. Much of the content is detailing the asset and market, while only a few pages for returns/risk/capital requirements.
Anywhere from 10 to 20, maybe 25 pages if it’s a real fucked up deal. Appendix with additional exhibits/figures on top of those included inline throughout the body of the text. No slide deck. Model can be anything from pretty basic cash flow models to absolute clusterfucks with thousands of revenue driver inputs (only seen one like that and it was a catastrophe to work on, it was a niche manufacturer with tons of SKUs and very specific applications for each in overlapping industry end markets, company was near insolvent and we want to sensitize for specific revenue cases, painful process, but very satisfying when the model finally worked perfectly) but usually somewhere in between and with plenty of opportunity to repurpose parts of somebody else’s model (sell side or sponsor if there is a sponsor involved).
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