At Main Street Capital Network (a group of 80+ SMB investors – individual, funds, and family offices), we periodically send out a newsletter to searchers we've connected with. You can learn more about us in this Searchfunder post. This past week's article was about investor teasers. I'm sharing it with the Searchfunder community in case others find it helpful.

FYI we like to meet acquisition entrepreneurs (searchers and independent sponsors) at all stages of the search/deal process. Please learn how to reach out to us here, whether you are:

1. Still searching
2. Preparing / negotiating an LOI

3. Under LOI

If you're an accredited investor interested in investing with us in search deals, please fill out this investor form.
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Grab Investors' Attention

It doesn't matter if you've found a high-quality business, available at a low multiple, and for which your work experience is a perfect fit, if no one takes the time to review your investor presentation.

This is why, in many ways, a teaser may be the most important part of your investor outreach. A teaser is nothing more than an attempt to get a busy investor to stop what they're doing and sign your NDA. That's it. You need to convince someone quickly (generally in no more than 1-2 slides) that it's worth their time to engage with you.

The majority of search investors are individuals that have a day job outside of investing. They're frequently sent teasers and don't have time to sign each NDA and read every investor presentation. A teaser with sloppy formatting, missing information, or that's so dense that key information hard to find, will usually be ignored.

Below is our advice to searchers and independent sponsors regarding best practices for teasers.

Teaser Best Practices

Formatting

Key information should be presented in an easily digestible format – bullet points, tables, and graphs as opposed to large blocks of text. You don't need to spend days making it look beautiful but the teaser should look polished and professional.

Length

Generally a teaser should have 1-2 slides of information but in some circumstances you may feel like you need to provide more information (complex industry, something unique about deal structure, etc). Total length is less important than the speed in which you can spark investor interest. Your teaser needs to pull the investor in with the first slide. The second page of your teaser will only be read if the first one is compelling. If an investor needs to read five slides to understand why the deal is interesting, you'll have lost them before they get there.

Key Information

Every deal is different but the below information is generally expected in a teaser:

• Investment highlights (summarize what's special about this opportunity)
• Company overview (industry, services/products provided, customer overview, location, # of employees, year founded, etc.)
• Risks and mitigants
• Your professional background
• Purchase price and multiple
• Deal structure (including sources & uses)
• Financials (at least 3 years of historicals – projections are optional but helpful)
• Investor terms and base case expected IRR
• Timeline (investor deadlines, expected close date of transaction, etc.)

• Anything else you think will convince investors that engaging with you is worth their time

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If you'd like to see an example of a good teaser, please feel free to reach out to me at --@----.com can learn more about Main Street Capital Network here.