Confidential Information Memorandum (CIM)
What is a Confidential Information Memorandum (CIM)?
A Confidential Information Memorandum (CIM) is a detailed document prepared by a company, typically with the help of investment bankers when it is seeking to sell itself, raise capital, or attract strategic partnerships. It contains in-depth information about the company and is shared only with qualified and serious investors or buyers under a confidentiality agreement.
Purpose of a CIM
- To present the business in a compelling and organized manner
- To help potential buyers or investors evaluate the company
- To provide all necessary details to assist in forming a non-binding offer (such as an Indication of Interest or Letter of Intent)
- It is often the first formal marketing document in a mergers and acquisitions (M&A) or fundraising process.
When is a CIM Used?
A CIM is used in:
- M&A transactions (company sales, mergers, asset divestitures)
- Private equity or venture capital fundraising
- Strategic partnerships or joint ventures
It is typically shared after the prospective party has signed a Non-Disclosure Agreement (NDA).
Contents of a CIM
While CIMs vary by company and industry, they usually include the following sections:
1. Executive Summary
- Overview of the company
- Purpose of the document
- Key highlights or investment thesis
2. Company Overview
- History and mission
- Ownership structure
- Key milestones
3. Products and Services
- Description of offerings
- Pricing models
- Competitive advantages
4. Market Overview
- Industry trends
- Market size and growth potential
- Competitive landscape
5. Customer Information
- Key clients and contracts
- Revenue breakdown by customer
- Customer retention and satisfaction
6. Operations
- Locations, facilities, supply chain
- Technology and infrastructure
7. Management Team
- Bios and roles of key executives
- Organizational structure
8. Financial Overview
- Historical financial statements (typically 3-5 years)
- Key performance indicators
- Forecasts and projections
9. Investment Highlights
- Reasons to invest/acquire
- Synergies or upsides for potential buyer
10. Legal and Regulatory Information
- Licenses and IP
- Ongoing litigations or compliance matters
Who Prepares a CIM?
A CIM is usually prepared by:
- Investment bankers or M&A advisors, in consultation with
- The company’s management team, legal, and finance departments
Why is Confidentiality Important?
Since the CIM contains sensitive and non-public data:
It is only shared with parties who sign an NDA
Unauthorized disclosure could affect the company’s market position, employee morale, or client relationships
CIM vs. Pitch Deck
| Aspect | CIM | Pitch Deck |
|---|---|---|
| Length | 30–100+ pages | 10–20 slides |
| Purpose | Deep-dive for due diligence | High-level overview |
| Audience | Institutional investors, buyers | Early-stage investors, VCs |
| Usage | M&A, capital raise, partnerships | Fundraising, networking |