Verifiable Is What Deserves to Be Quoted

Investors have a plain rule of thumb: thick materials are fine, materials you cannot check are not.

Let us state the view first. A meeting aligns understanding; materials fix it in place. The value of materials is not in looking good. It is in whether someone dares to pass them on. We have one requirement for materials: deliver to material-library standard — underlying logic, interview notes and operating data prepared in one go, complete, transparent, highly verifiable. Whatever the size of the deal, however early the round. Why? Three layers below.

Verifiable Is the Floor

Verifiable means every number has a source, every quotation has its context, every judgement can be taken apart back to facts. In other words, every number needs a ruler attached. An investor who receives the materials should not have to make three or five calls to check them. How long does one round of checking take? Two or three days at least. Those two or three days come out of the window.

Now the investor's side. Investing looks at safety first and odds second; however full the win rate sounds, the odds may not keep up. So when he goes through the materials, what he looks for first is not the highlights. It is the holes. Making materials look good is not hard. But if one spot does not hold up, the whole set gets checked again. The effort saved is paid back double. Materials that cannot stand checking are a negative asset.

Quotable Is the Higher Bar

Once the materials leave your hands, the person speaking for you is not in the room. The investor takes them and has to retell it once more to his own investment committee (IC). Does retelling distort? Of course. And distorted information is more trouble than missing information. So we write materials in a form that can be carried away: precise wording, sources marked, conclusions restrained. Every page can go straight into the other side's report.

Thick materials look sincere. But they usually stop at the second pair of hands. So far, what actually circulates is never a business plan (BP) running to dozens of pages. It is a few pages of core logic. What we do is this: pick out the three to five questions that keep coming up at investment committees, answer them up front, and hold each answer under two hundred words. Why two hundred? Because that is all a person remembers. The key is not in the page count.

Preparing It All at Once Respects Time

First, deliver the logic, the notes and the data in three batches and the other side waits three times, pieces it together three times, chases three times. Second, count each round of follow-up at two days there and back, so three rounds is six days (the figures are illustrative). Third, six days inside a sixty-day schedule is a full tenth, and it lands in the early stretch, where a delay hurts most. Prepare it all before delivering, and what is slow is only the single delivery.

So is a few days' delay a worry? No. Prepare it all before delivering and what you save is the total. What a client pays for was never that stack of documents. It is the time saved, and the detours not taken. Documents are comparable; judgement is not. On this one we are fairly confident. But we will say it only once.

A word of disclaimer: the above is our own practice and does not constitute investment advice. Putting the evidence up front is what we owe each company, not a judgement about the market.

Screening, meeting, materials — if all three actions are right, how do you know the whole system is really improving rather than just feeling better about itself? The next piece is about the three measures we hold ourselves to.

(The full statement on the material library is in the Archive, in the section "To Entrepreneurs and Investors".)