Is PPM required?

searcher profile

January 11, 2021

by a searcher from Massachusetts Institute of Technology - MIT Sloan School of Management in Los Angeles, CA, USA

Looking to raise capital from non-family and friends - does this automatically mean I need to have a PPM? What does the PPM include that a CIM does not?

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commentor profile
Reply by a searcher
from Northern Alberta Institute of Technology in Edmonton, AB, Canada
Assuming you're raising capital for a funded search, almost definitely. Before you can reasonably expect professional investors to invest in your fund there needs to be a pitch or a point of discussion. There's nothing specific about a PPM that makes it special, it's simply a clean and concise way to present A)who you are, B) what you're doing (or intend to do), C) how you are going to do it, along with IRR expectations. You owe it to investors out of professional courtesy. Think of it as your first act of fiduciary duty. CIMs are specific to particular deals, and do nothing to explain who you are, what you're doing, and how you'll invest and meet IRR requirements.
commentor profile
Reply by an investor
from University of Pennsylvania in Washington, DC, USA
Happy to chat as invested in number of self-funded deals and looked at even more. In general, you'll need a 1-2 pager (send ahead of NDA to see if interest), a PPM (CIM + layer on who you are/doing/etc), and a model. Send me email redacted and I can give you my PPT on tips for self-funded searchers which has some notes on these items.
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