Investment Memorandum Generation

Generate structured investment memos from the acquiring company's perspective.

Perspective

• - Written for the acquiring company (use "we" for acquirer)
• Written about the target company (use company name or "the target")
• Align with acquirer's investment thesis and acquisition strategy
• Present balanced view: opportunity AND risk

Memo Structure

1. Executive Summary (1 page)

• - Transaction overview: target name, sector, deal size, structure
• Strategic rationale in 3-4 bullet points
• Key financial metrics (revenue, EBITDA, growth, valuation)
• Recommendation: Proceed / Proceed with Conditions / Pass

2. Company Overview

• - Business description and history
• Products/services and revenue mix
• Customer base (count, concentration, retention)
• Management team assessment
• Organizational structure and headcount

3. Market & Competitive Position

• - Industry overview and growth outlook (reference market intelligence)
• Competitive landscape and target's positioning
• Sustainable competitive advantages (moats)
• Key risks to market position

4. Financial Analysis

• - Historical financials (3-5 years): revenue, EBITDA, margins, FCF
• Revenue quality: recurring %, customer concentration, cohort analysis
• Working capital dynamics and cash conversion
• CapEx requirements and capital intensity
• Key financial trends and inflection points

5. Valuation

• - DCF analysis (base/bull/bear cases)
• Comparable company analysis (public comps)
• Precedent transaction analysis
• Implied valuation range and recommended offer price
• Sensitivity analysis on key assumptions

6. Strategic Rationale & Synergies

• - Revenue synergies (cross-sell, market expansion, pricing)
• Cost synergies (overlap elimination, procurement, shared services)
• Timeline to achieve synergies (Year 1 / Year 2 / Year 3)
• Integration complexity and risk assessment
• Synergy value vs. premium paid analysis

7. Risk Assessment

• - Deal-specific risks (top 5, ranked by impact × likelihood)
• Mitigation strategies for each risk
• Deal-breaker thresholds
• Sensitivity of returns to key risk scenarios

8. Transaction Structure & Returns

• - Proposed structure (asset vs. stock, cash vs. equity mix)
• Sources and uses of funds
• Pro forma leverage and coverage ratios
• Expected returns: IRR, MOIC, payback period
• Key assumptions driving returns

9. Recommendation & Next Steps

• - Clear recommendation with confidence level
• Conditions or diligence items to resolve
• Proposed timeline for next phase
• Required approvals and process steps

Data Aggregation Strategy

1. 1. Pull existing DD data from platform (fast, <1s)
2. Fill gaps with RAG queries over uploaded documents (medium, ~3s)
3. Augment with market context via web research (slower, ~5s)
4. Synthesize into narrative sections with AI (~5-10s)

Quality Standards

• - Every claim backed by data point with source
• Financial figures must reconcile across sections
• Clearly separate facts from assumptions from opinions
• Use conditional language for projections ("we estimate", "management projects")
• Flag data gaps explicitly rather than filling with generic text
• Total generation target: 15-20 seconds

Output Formats

• - Markdown: Primary format for platform display and editing
• PDF: Professional layout for IC distribution
• PPTX: Presentation format for deal committee meetings
• Excel: Supporting financial model and sensitivity tables