What is a pitchbook?

A pitchbook is a document put together by a bank to sell a particular product or service to their clients. There is no single set template for pitchbooks across the industry, they can vary greatly from bank to bank, and based on what the end purpose of the pitchbook is. For example for an IPO, a pitchbook may contain biographies of team members that would be working on the project, past IPO successes at the bank, and possibly proposals on how the process could play out. 

Pitchbooks are used in various scenarios, all of which involve persuading a client that your bank/firm is the best one to carry the business that is being pitched. As a result, pitchbooks are used by both sell and buy-side firms during the client acquisition process. 

Although the contents will vary based on the industry, type of deal, and the targeted clients, there are several components you can find in most pitchbooks. Similarly, most will follow a structure like this: 

Introduction - About the firm, specific team, and past experience 

This typically begins by talking about the firm as a whole, company performance over recent years, and any key points about themselves such as global footprint. Then it moves on to past deals completed by the group, e.g. Goldman Sachs Tech M&A, or Jefferies Automotive M&A, also providing details such as transaction sizes, date of completion, etc. Finally, the individual team members are introduced, along with a short list of previous deals they’ve worked on, both at their current bank and any previous ones as well. This all helps convince clients that your firm will be able to carry out the deal or transaction that is being pitched. 

Context - Industry specifics

After introducing the bank/firm, the pitchbook turns to more general industry facts and figures. This lays the groundwork and gives context to the clients' issues and how they can be solved by the company pitching to them. An example of something that could be included would be: recent industry trends, total market size, or recent regulations affecting the industry. Another aspect often included in this section is recent deals in the sector and information regarding them, giving the client a better idea of the deal space specific to their industry or sector.

From here, the contents will begin to vary based on what the purpose of the pitchbook is. 

1. Sellside mandates focus on showing the potential client how they could be positioned to get the most out of a sale. Parties who are possibly interested in the deal would also typically be listed, alongside some sort of valuation model such as a discounted cash flow (DCF) analysis of the potential client. Sellside mandates are usually closed out with a summary of the book, along with recommendations moving forward which tend to be more generic.

1. Buyside mandates are similar to their sell-side counterparts, with some notable differences. Firstly any valuations of the potential client are done to assess how large of a stock offering would be needed to finance a purchase, Instead of detailing how the company can be positioned to sell better the focus is on what type of transaction is most beneficial for the client, and rather than listing potential buyers, you will list potential targets to be acquired. Companies meet with many teams of bankers at a time so one of the most crucial aspects of a successful buy-side pitchbook is some originality.

1. Financing mandates are the final type of pitchbook you may encounter. These detail how a company could go about raising equity or debt. These have no company profiles as there are no other parties involved in being acquired or doing the acquiring, and rather than a standard valuation as is found in the buy and sell-side mandates there will be a financing model included which will give the potential clients an idea of proceeds and how the move could affect the companies valuation.

To summarise, pitchbooks are a tool used by investment banks to persuade a client to use their bank for whatever service is being pitched. Although the layouts will vary most pitchbooks of similar nature follow similar layouts and will all have a mixture of market overviews, technical analysis, biographical sections, and opinions of the bank. Pitchbooks are versatile and important tools that allow banks to market themselves to potential clients and win business, without them many deals would be conducted by whoever could quote the lowest commission, quickest turnover time, or simply the more prestigious bank without taking into account a myriad of other equally important factors.