How to Create an Investment Banking Pitch Book

What makes a great pitch book?

While the complex task of structuring and closing corporate mergers, acquisitions, and cash infusions is led by investment bankers in the deal room, behind every great banker is an enterprise-grade pitch book that’s a key tool to communicate their plan and strategy.

Investment banking is a specialized service offered by financial institutions with the purpose of connecting companies and investors.

Investment banks often deliver advisory-based financial transactions for individuals, government organizations, or, more frequently, private and public corporations.

The creation of a pitch book is no easy task and should not be overlooked.

Let’s go over some expert tips to keep in mind while creating a pitch book that will help seal the deal in and outside of the investment banks.

What is an investment banking pitch book?

Before going over the key tips, we first must understand what investment banking pitch books actually are and what they accomplish.

Regarding investment banking, pitch books are visual presentations used to encourage and engage potential clients to commit to a financial transaction via an investment bank.

In the world of investment banking, a deck-based presentation can be used for several purposes, including equity funding, M&A, restructuring, securities trading, and general advisory services.

Investment bankers and analysts need to craft a pitch book that will convince a company, individual, or organization to let the firm represent them during a large transaction.

How to prepare an investment banking pitch book

Often financial data-heavy and strategic, an investment banking pitch book requires a tedious analysis and data organization among other types of detail.

It proposes a major financial decision that is often structured by seasoned strategic leaders and directors, like Finance VPs and CFOs.

The general strategy and content outline of an investment banking pitchbook is its foundation. It is necessary for it to be developed by Managing Directors with sufficient knowledge and experience in the transaction that will be proposed.

The presentation outline will then be populated by well-researched information, often curated and analyzed by financial analysts and junior bankers.

Now that we covered the details of how to structure an investment banking pitch book, let’s review some more tips on the topic.

Defining points that can make or break an investment banking pitch book

An investment banking pitch presentation can easily be the deal closer if delivered properly or negatively affect a major financial decision if prepared improperly.

Each slide is equally important and must have a consistent supporting flow in order to persuade and engage clients into investment bank deals.

Here are some of the most important points to include in an investment banking pitch book

Key slides

There are significant slides in an investment pitch book that can most certainly affect a potential client’s decision-making process.

Here are the key parts of the pitch book that require strong attention:

• Title page – A complete title page should be clean and simple with a straightforward statement of who or what the presentation is all about. It can often include the company logos of both the investment bank and the client, the proposed transaction, and the date. This is the first slide a viewer will see so make sure it pops.
• Table of Contents – Since the presentation will contain various information and numerical data, a table of content will be very useful in guiding the clients on your presentation’s flow.
• Investment Firm Intro – Include a slide to introduce both the firm and the team that will be presenting the pitch. Demonstrate successful projects and let them know about your track record for transparency.
• Executive Summary – This often includes the background of your prospective client as well as their current state or situation. This can also include the addressable problem and the proposed solution and hypothesis. Most executive summaries range from four to six bullet points with one or two sentences per bullet.
• Valuations – Valuation methods, mainly DCF analysis, comparable company analysis, and precedent transactions, are vital parts of a pitch deck in investment banking. The approach in valuations and pricing varies depending on the transaction being proposed, whether it be buy-side, sell-side, merger, or others. This will help establish why the transaction being proposed is needed.
• Transaction Strategy – A well-defined transaction strategy will help potential clients further understand how the investment banking firm will execute the proposed plan and how the client can benefit from it.

Data

Financial data is an investment bank pitch book’s major topic and must be structured and organized into a comprehensible representation of the opportunity.

Use graphs and tables so the audience can quickly interpret large datasets.  The data covers valuations, pricing, and when needed, they are compiled and included as the document’s appendix.

Here are some important data scenarios that should be included in an investment banking pitch book, based on its purpose:

• Sell-Side – The valuation analysis presented for sell-side usually includes the financial data of parties that can possibly have an interest in purchasing the company. This will also present how much the client can possibly make as a result of the transaction.
• Buy-Side M&A – Data presented to clients are often purchasing opportunities depending on the problem presented. It can be statistics on the need to expand their service, how much it will cost to acquire certain companies with specific services, and what the potential returns can be.
• Equity and Debt – When it comes to pitching a financing project for equity, debt, or restructuring, it is ideal to present data through a financial model. Valuations can be supplementary, but a financial model can help present better data comparison and analysis needed for such transactions.

Theme

Investment banking decks serve as formal proposals.

With this, it is necessary to use a simple theme in creating the document. Common investment banking pitchbooks from Barclays, JP Morgan, Credit Suisse, Goldman Sachs, and other known institutions use clean white, backgrounds with an accent of their brand’s colors. This makes a pitch deck easier to understand.

General Flow

A pitch deck’s structure is almost universal. It has to follow a certain flow that will lead its audience to a decision. Each slide should complement and lead into the next.

However, a less miscellaneous marketing approach should be used.

An investment banking deck should begin with a general idea, from what the whole proposal is about, who is presenting it, and why.

It should narrow down to the specifics, like the step-by-step execution of the transaction as well as the possible projected outcomes.

What to avoid?

Keep your pitch deck strong and concise by avoiding the following mistakes:

Jargon

An investment banking pitch is often presented to the board of directors. However, there will be finance and banking terms that are not often used or understood the same way in other sectors. Avoid using jargon and keep the pitch book and its presentation simple and easy to understand.

Fluff

Decisions will be made by the end of the pitch presentation. So cut the fluff and keep it straight and strategic. Avoid marketing words or flowery statements that are too salesy or unrealistic. Stick with the facts and data.

Excessive info

Financial data will strengthen your proposal, but too much of it can easily make your presentation confusing. As much as possible, summarize information and only include the ones that will strongly support your main point. Use visual representations whenever applicable and only add appropriate text descriptions.

Overwhelming the audience

Finally, try to not overwhelm your potential clients by bombarding them with unnecessary information or presenting your pitch too fast. Deliver targeted information at a pace that will allow your audience to fully understand what you are pointing out.

How to walk through an investment banking pitch book in real-time

Start with the most important points

When delivering a pitch presentation, both in person and virtually, the best way to open it is to introduce the main idea you are proposing.  When delivered via video conferencing, you will need to get your potential client’s full attention.

Establish your case first and let them wonder why and how for a bit. As you proceed, that’s when you can explain the proposal in full detail.

Keep it brief and concise                                                                                      

It is highly advisable to prepare a pitch deck with not more than 25 pages, which you can explain in about half an hour or so. Make sure that your slides are readable from the screen and you give  enough time for people to read the slides.

Try to explain the information in a single slide within a certain span of time that the audience will have enough time to look at the data being presented. Do not switch slides too fast. Including macro graph views within slides so your clients can focus on a single point to avoid confusion is always a great practice.

Emphasize your financial analysis

A huge part of fully highlighting what you can do for your potential client will come from the financial analysis.

It will serve as the basis of how your proposal can help them and why they should engage with you. Put in the extra effort in the financial analysis and how the deal will be structured and financed.

The financial analysis can also express the merits of the transaction for your client, so make it a strong and comprehensive analysis.

Keep it engaging

As the world shifts to virtual meetings and presentations, you will need to be more engaging with clients.

Ask a question or let them ask you. Interact with your clients and create a connection with them to have better chances of communicating your message to them

Conclusion

Investment banking pitchbooks influence crucial decision-making.

They should be created carefully by banking leadership and experienced analysts to provide potential clients with the right combination of facts, figures, potentials, and projections.

Keep your pitchbook simple, comprehensive, and organized and let your clients see your vision to close deals, build trust and establish strong corporate relationships.

If you need help creating an investment banking pitch deck, contact us!

About the author

Leslie Morales is the CEO of Launch Module and a Certified High Performance Coach. Learn more about Leslie and her team on our About Us page.