When Selling a Business Should You Have a Pitch Deck, Information Memorandum, of Both?

Selling a business requires much more preparation than most people realize. Part of this preparation includes creating the marketing and disclosure documents that will be used to help attract buyers or investors and facilitate a sale. Two of these documents are the information memorandum and the Pitch Deck. They both play an important role in presenting your business.

Information Memorandum

The Information Memorandum is a document that outlines the details of the business for sale. It is laid out similarly to a business plan. It includes a history of the business, a description of the current products/services, marketing and operation plans, market/industry overview, information of current key staff, and – of course – financial history and Financial Projections. It will also include information on what type of sale or investment you are seeking and what the benefits are to the potential buyer/investor.

In most cases, potential buyers or investors will not review the information memorandum until they have expressed interest in the business and signed a non-disclosure agreement (NDA). There are multiple ways a potential buyer or investor may have come to be aware of your business. One of those ways is a pitch deck.

Pitch Deck

In terms of mergers and acquisitions, the pitch deck is often referred to as a teaser. The teaser, or pitch deck, is a visual summary of the information memorandum and is treated like an investment summary. It is used to spark interest in reviewing further details about the business, which is what is covered more in depth in the information memorandum. It is a much shorter document, that may be as small as a one-sheet, or a collection of several top-line slides.

The Argument for Both

You can’t know for certain what your potential buyers are going to want to see until you have identified them. Only once they are identified can you start to consider which approach will be best. In many cases, in order to be prepared for any potential buyer that may come along, you should have both. The teaser can get them to agree to look at the full information memorandum and seriously consider the business.

The Overlap

It may seem like if you aren’t certain you will need a pitch deck or teaser, maybe you should hold off. However, it is actually quite efficient to design both at the same time though you certainly don’t have to. Perhaps you are comfortable creating the information memorandum or you are utilizing an M&A advisory firm that takes care of that. You may then choose to have a Professional Pitch Deck writer take care of the teaser after the fact. Either way, the information memorandum will inform the pitch deck. Once that’s done, you can do the other at any point.

Ultimately, it’s going to come down to what you think will work for your particular audience. If you have a serious buyer who is already interested, you can likely skip the pitch deck. You will always need the Information Memorandum, especially as it is required in many states along with other types of disclosures. But, in the end, these documents work best together so, you should consider having both at the ready.