Investment Memo: Founder vs VC Memo

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	Founders’ Investment Memo	VCs’ Investment Memo
Purpose	To persuade investors to fund the startup by showcasing its potential.	To evaluate and document the rationale for recommending the investment to internal stakeholders (e.g., partners or investment committees).
Audience	External: Angel investors, venture capitalists, or other funding sources.	Internal: VC firm partners, investment committees, and occasionally LPs (Limited Partners).
Focus	Vision, growth story, market potential, and immediate funding needs.	Due diligence, thesis alignment, risk analysis, and return potential.
Key Components	- Problem statement and solution

Market opportunity
Traction and metrics
Revenue model and business strategy
Team and vision
Financial projections
The funding ask. | - Company overview
Market analysis (size, trends, competitors)
Product assessment
Financials (metrics, projections, unit economics)
Risks and mitigations
Exit potential.
Deal terms. | | Length | Typically concise (2-5 pages) or a short deck format; focused on storytelling and highlights. | Lengthier (5-20+ pages); a comprehensive document that dives deep into specifics, often with appendices for additional detail. | | Market Analysis | Broad overview of market size, TAM (Total Addressable Market), and growth trends to excite investors about the opportunity. | Detailed breakdown of market size, segmentation, competitive landscape, and growth drivers, often including supporting data and comparisons. | | Team Emphasis | Heavy emphasis on the team’s expertise, vision, and why they are uniquely positioned to solve the problem. | Focus on evaluating team strength, past experience, and ability to execute; often includes due diligence on founder track records. | | Financial Projections | Focused on big-picture projections and high-level growth metrics (e.g., ARR, CAC, LTV). | Deep dive into financials, including unit economics, runway analysis, burn rate, and sensitivity analysis for different scenarios. | | Deal Terms | Often limited to a clear ask for funding, valuation, and expected use of funds. | Detailed breakdown of the deal structure, including valuation, ownership percentage, potential dilution, and any special terms. | | Exit Potential | May mention IPO or acquisition opportunities but with less emphasis; focus remains on building a large business. | Specific assessment of exit scenarios, expected returns, and potential acquirers based on current industry trends. | | Use of Data | Highlights key metrics and uses data selectively to emphasize traction or growth potential. | Heavy reliance on data analysis, including charts, financial models, benchmarks, and market research. | | Risk Disclosure | Risks are downplayed or framed optimistically (e.g., "We see challenges as opportunities"). | Risks are explicitly outlined, with detailed mitigation strategies to justify the investment despite potential downsides. |