I Write CIMs Not Tragedies

Most fresh analysts shudder at the thought of being staffed on their first Confidential Information Memorandum, or CIM. A 40-80 page document that will be shown to all the potential investors/buyers of a firm, it has to look perfect and sell that little piece of shit for at least twice its “true” value (of course all truth is arbitrary in banking). Not to worry, however, the CIM is one of the easiest things you’ll ever do – but do it right and everyone will think you’ve toiled endless days and nights. Creating the illusion of long hours and hard work is the most important skill of a good analyst.

Rarely will you actually have to write anything in banking. Most documents (like sales memos and engagement letters) are fully templated and so shrouded in legalese that only a legal weasel could comprehend them anyways. At first glance CIMs appear different, however. They’re meant to sell the company and must therefore be understood by any potential buyer who, we are to assume, has no legal or finance experience. Does this mean you must actually write up a coherent thesis on why this company is such a great buy? Hell no! You weren’t hired as an analyst to think. Fine, you say, but how do I fill up all these pages then?

Elementary, my dear Watson. Unlike your reputable academic alma mater the bank is amoral and encourages plagiarism. First, ask the company for all of their marketing, financial and business documents. Next, assuming the company is private, find the offering memorandum of a comparable public company on EDGAR and steal their industry overview and risk sections. Now you have all the building blocks to create your Tower of Babel.

You must copy and paste and arrange all the different pieces of different documents into your CIM’s sections, which your VP/Associate should have already defined. Remember to make it look pretty and throw in lots of pictures. Investors, like fish, have short attention spans and need shiny lures to be hooked. If you’ve ever had the “privilege” of meeting with a client for a pitch you already know that 70-80% of the book you’ve spent all of last night making is never even discussed. The CIM is no different. Investors will only read the executive summary, which is a concise copy-and-pasted version of the full CIM, look at the pictures and flip the financials. That’s enough for them to decide if they want to proceed further, and as you must know by now you only need to do the minimum work necessary to get the investor hard about your client.

That’s all there is to it. Your value-add is essentially reformatting and partially rewriting a bunch of garbage and making it look like a legitimate business operation. One final note, remember to look busy during the day and have Outlook automatically send the email with the CIM attached at 4:00am. Virtual facetime is a wonderful thing.