Key points
- Release information in stages that match the investor's interest
- Start with a short teaser, often anonymised
- Share the deck and model under confidentiality
- Reserve sensitive documents for serious diligence
Companies raising capital tend to make one of two mistakes. Some send everything at once: deck, model, contracts and data room access to anyone who asks. Others share so little that the investor cannot form a view and moves on. The answer is a staged release, where each stage gives the investor enough to decide whether to proceed to the next.
Stage one: the teaser
One or two pages. What the opportunity is, the sector, stage and geography, the capital sought and its purpose, and the headline investment case. It is often anonymised, so it can be shared before any confidentiality agreement. Its only job is to let the investor decide whether the opportunity fits its mandate and merits a closer look.
Stage two: the deck and summary financials
Once the investor has expressed interest, and usually after a non disclosure agreement, share the full deck or information memorandum and summary financials. The investor should now be able to decide whether to commit time to diligence.
Stage three: the model and first tier data room
For investors that want to proceed, share the financial model and the core data room: corporate, financial, and the key evidence for the investment case. See what to include in an investor data room.
Stage four: full diligence
Commercially sensitive material, such as detailed contract terms, pricing, customer data and supplier agreements, is shared with investors in serious diligence, typically after indicative terms are agreed.
What to avoid
- Sending the full deck cold. An unsolicited 40 page deck is rarely read.
- Sending the model before the investor has engaged. It invites a review before interest exists.
- Mass distribution. Investors notice when an opportunity has been widely shopped, and it weakens your position.
- Withholding the basics. Refusing to name the sector or the size of the raise wastes everyone's time.
Keep a record
Track who has received what, when and under which agreement. It protects confidential information and tells you where each investor is in the process.
When BriHel makes an introduction, nothing is shared with an investor without your agreement, and confidential materials follow a confidentiality agreement where you require one. See also how to approach institutional investors.
Before you approach the market. The Investor Readiness Review tells you what an investor will conclude from your materials, and what to fix first. £995 plus VAT.
This article is general information, not investment, legal, tax or financial advice. BriHel Capital introduces only and does not arrange transactions, provide advice, or carry out regulated activities.