A final offering memorandum (FOM)—often called a private placement memorandum (PPM)—is the formal disclosure document a fund manager provides to prospective limited partners detailing investment strategy, terms, risks, and subscription procedures for a private offering.

How it works

Counsel drafts the FOM from the term sheet and LPA template: fund size, fee and carry, key person provisions, investment restrictions, conflicts, and risk factors ( illiquidity, loss of capital, regulatory change). Qualified purchasers or accredited investors receive it under Regulation D before signing subscription docs and wiring capital. Amendments issue if terms change pre-close.

The FOM is not filed publicly like an IPO prospectus, though Form D notice follows the offering. LPs compare FOM representations to executed LPA and side letters; material mismatches trigger legal review. Co-invest SPVs and continuation funds also use FOM-style disclosures.

Founders encounter FOM analogs in private company secondaries or GP-led stake sales—not in standard venture rounds using NVCA docs.

Why it matters

• Founders: Relevant when evaluating fund LP stakes or corporate venture vehicles raising outside capital—terms live in these memos.
• Investors: FOM is the starting diligence artifact; risk factors and conflicts sections reveal GP platform complexity missed in pitch decks.

Common mistake

LPs signing subscriptions without confirming the FOM matches the final LPA execution. Always reconcile fee bases, carry hurdles, and key person definitions across documents.

Related ideas

See LPA, Form D, subscription agreement, and private placement.