VC Investment Memo Template: Free Outline With 10 Sections From Thesis to Recommendation

A VC investment memo is the internal document a deal partner writes to take an investment to the firm's partnership. It sets out the thesis, the evidence for and against it, the deal terms, the returns math and a clear yes or no. This VC investment memo template gives you a free, step-by-step outline of 10 sections, from thesis to recommendation, that you can copy into Word, Notion or Google Docs and pair with an Excel template for the returns model.

Most first-time memo writers make the same mistake. They write a pitch deck in prose. The partnership has already seen the deck. What it wants from the memo is your judgment on what has to be true for this company to return the fund, how sure you are, and what would change your mind. The outline below forces that discipline.

What a VC Investment Memo Template Has to Do

The memo exists because selection drives venture returns. In the largest survey of VC decision-making to date, Paul Gompers, Will Gornall, Steven Kaplan and Ilya Strebulaev polled 885 institutional VCs at 681 firms. They found that the average firm looks at about 200 companies for every 4 investments it makes, a hit rate of roughly 2%. Respondents rated deal selection as more important to value creation than sourcing or post-investment help, according to the NBER Digest summary of the paper.

The same study shows where partners will spend their attention when they read your memo. Ninety-five percent of firms called the founding team an important factor, and 47% called it the single most important one. Business model came next at 83%, then product at 74% and market at 68%, per the Harvard Law School Forum on Corporate Governance write-up. The study also found that few VCs use DCF. Cash-on-cash multiple (MOIC) is the most common return metric, 20% of firms don't forecast cash flows at all, and 9% use no quantitative metric.

Your memo should therefore do four jobs:

State a falsifiable thesis in one paragraph.
Weight the team section heavily, because that is where partners will push.
Show MOIC-based scenario math in place of a 10-year DCF nobody will believe.
End with a recommendation and the conditions attached to it.

Takeaway. Before writing a word, write the one-line answer to "why will this return the fund?" If you can't, you aren't ready to write the memo.

The 10-Section VC Investment Memo Template Outline

The structure below draws on two public reference points. The first is Sequoia's "Writing a Business Plan" guide, which asks founders for company purpose, problem, solution, why now, market potential, competition, business model, team and financials. The second is the set of internal memos Bessemer Venture Partners has made public for portfolio companies including LinkedIn, Pinterest and Shopify. The memo reverses the founder's order. The verdict goes first and the evidence follows.

1. Executive Summary and Deal Terms

One page maximum. Give the company, round, amount, instrument, pre-money valuation, your check, target ownership, board seat and co-investors. Then add three sentences of thesis and the recommendation itself. A partner who reads only this page should know what you are asking for. Use NVCA language for the terms. The NVCA model legal documents, including the Enhanced Model Term Sheet v.3.0 built with Aumni, are free and carry market data on how often each term appears, so you can flag anything off-market.

2. Investment Thesis

Write three to five numbered claims, each one testable. "SMB merchants will move commerce to hosted SaaS because incumbent enterprise vendors can't serve them" is a thesis. "Large market, strong team" is not. Bessemer's 2010 Shopify memo leaned on a thesis of this kind, stating that "incumbent enterprise software vendors have proven themselves unable to compete," as quoted in an analysis of the BVP memos.

3. Why Now

Sequoia's guide notes that the best companies almost always have a clear "why now". Name the specific shift, whether a cost curve, a regulation, a platform change or a behaviour change. Date it. If the same company could have been built in 2015, explain what has changed since then.

4. Market Sizing

Build the market bottom-up: customers multiplied by price multiplied by realistic penetration. Show TAM, SAM and the share you need to win for the returns case to work. Then admit where you could be wrong on the low side. Bessemer's LinkedIn memo, dated 11 December 2006, sized the online jobs market at about $2 billion. LinkedIn later passed $6 billion in revenue in 2019, per the same BVP memo analysis. Category creators often beat a narrow initial TAM, and your memo should say whether this company can.

5. Product and Customer Evidence

Write up the evidence you collected yourself. Include customer reference calls (aim for 5 to 10, with at least two found without the founder's help), cohort retention, usage data and win/loss notes. Quote customers by role. Separate what you verified from what management told you.

6. Team

Given the 47% figure above, spend real space here. Cover founder-market fit, prior outcomes, how the founders split roles, hiring velocity, and back-channel references from former colleagues and investors. Name the single biggest gap on the team and say who fills it within 12 months.

7. Competition and Defensibility

Build a table of named competitors with funding, pricing, positioning and where this company wins or loses. Then describe the moat as it stands today and as it should look in three years: network effects, switching costs, data, distribution or scale economics. Avoid the "no competitors" claim. Partners stop reading at that line.

8. Business Model and Financials

Cover revenue model, gross margin, CAC payback, net revenue retention, burn multiple and runway after this round. Present the company's plan and then your haircut version beside it. Most partners will trust your downside case more than management's base case, so show both columns in a spreadsheet model and link it.

9. Valuation, Ownership and Returns Scenarios

Benchmark the price against market data, then show the scenario table (worked example in the next section). For context, Carta reported a median Series A pre-money valuation of $49.3 million and a median seed pre-money of $16 million in its Q3 2025 State of Private Markets, up from $48 million at Series A in Q1 2025. A price well above those medians needs an explicit justification.

10. Key Risks, Open Diligence and Recommendation

List the top five risks, ranked. For each one, state the mitigant and what evidence would make it worse. List any open diligence items with owners and dates. Close with a plain recommendation ("Invest $12M at $48M pre, conditional on X") plus the milestones you'd expect before the next round.

Takeaway. Copy these 10 headings into a blank document now and fill section 1 last, once the evidence below it is written.

Returns Math: A Worked Scenario Table Example

Bessemer's Pinterest memo, dated 3 April 2011, put a 10% probability on the company imploding and only a 1% probability on an IPO, according to the BVP memo analysis. Pinterest went public in 2019 anyway. The firm still did the useful thing, which was to write explicit probabilities down so the partnership could argue with them.

Here is an illustrative example using a lead check in a $150M fund:

Entry: $12M into a Series A at $48M pre-money, so $60M post and 20% ownership.
Dilution: assume 30% cumulative dilution through later rounds and option pool top-ups, leaving 14% at exit.
Fund-returner test: to return the full $150M fund from this one position, the company must exit at about $1.07B ($150M divided by 14%).
Scenarios:
- Wipeout, 50% probability: 0x.
- Modest exit at $150M, 25% probability: $21M back, 1.75x.
- Strong exit at $600M, 20% probability: $84M back, 7x.
- Outlier exit at $3B, 5% probability: $420M back, 35x.
Expected MOIC: (0.25 x 1.75) + (0.20 x 7) + (0.05 x 35) = about 3.6x.

Half of that expected value comes from the 5% outlier case. That is normal for venture, and your memo should say it out loud. If the outlier case requires a market bigger than your section 4 sizing supports, the deal fails your own test. Build this table as an Excel template with probabilities, exit values and dilution as inputs, so partners can change assumptions live in the meeting.

Takeaway. Always show the exit value needed to return the fund. It is the fastest sanity check a partner will run, and you want to be the one who runs it first.

How to Write the Memo Step by Step

A memo for a Series A lead usually comes together over two to four weeks of diligence. This sequence keeps it from turning into a last-minute scramble:

Day 1, draft the thesis. Write section 2 after the first meeting, before you are anchored by the data room. Label each claim "unverified".
Days 2 to 5, build the diligence plan. For every thesis claim, list the evidence that would confirm or kill it, such as data requests, customer calls and expert calls.
Week 1 to 2, run references and data. Fill sections 5, 6 and 8 as evidence arrives. Update each thesis claim to "confirmed", "weakened" or "killed".
Week 2, build the model. Complete the returns spreadsheet and the competitor table. Pull valuation comps from Carta or PitchBook data.
Week 3, write risks honestly. Ask a colleague who isn't on the deal to write the bear case independently and paste it into section 10.
Final 48 hours, write the executive summary. Compress everything into one page and circulate it to the partnership at least 24 hours before the meeting.

Common failure modes to check for before you send:

Thesis claims that no evidence in the memo addresses.
A market size quoted from an analyst report with no bottom-up check.
Projections copied from the company model without a haircut.
Risks listed without mitigants or ranking.
A recommendation hedged into meaninglessness ("worth exploring further").

Keep a final archived copy. Bessemer's public memos are useful largely because they show what the firm believed at the time, including what it got wrong. The same analysis warns about survivorship bias, since BVP released memos only for companies that went public or were acquired. Your own archive, which includes the misses, is the better training set.

Takeaway. Put the six steps on your deal calendar on the day you issue the first data request.

Why Start From a Ready-Made VC Investment Memo Template

The firms that write good memos write them the same way every time. A fixed structure lets partners compare deals side by side, makes post-mortems possible years later, and stops each associate from reinventing the format under deadline. The 10 sections above cover what the evidence says partners care about: team first, then business model, product and market, with MOIC-based returns math in place of a DCF that few VCs use.

A blank page costs you a day of formatting before you write any analysis. A ready-made template, with the 10 headings, prompts under each, a competitor table, a risk register and a linked Excel returns model with scenario probabilities and fund-returner math built in, puts that day back into diligence. Download the free outline, fill section 2 after your next first meeting, and you'll have a draft memo before the data room closes.