The investment committee (IC) is the governing body within an investment firm — usually comprising senior partners — that formally approves or rejects proposed investments.

How it works

After diligence, the sponsoring partner presents the opportunity to IC using an IC memo. IC meetings may be weekly or ad hoc for competitive deals. Voting rules vary: unanimous consent, majority, or lead-partner veto rights on their sector. IC can approve, reject, or request additional diligence — customer references, expert calls, revised terms. Some firms delegate smaller checks below a threshold without full IC. Rejected deals may resurface if circumstances change. IC also reviews follow-on investments, reserves, and exits. For founders, the path is typically: associate screen → partner meeting → diligence → IC → term sheet. IC rejection after positive partner feedback is common and frustrating but structurally normal.

Why it matters

• Founders: Ask your sponsor about IC timing and process. Provide materials that answer likely partner objections before the meeting.
• Investors: IC structure prevents rogue deals and creates accountability. Firms with weak IC discipline often show inconsistent portfolio quality.

Common mistake

Assuming one champion partner can bypass IC. Even managing partners at large firms usually need IC buy-in for fund investments.

Related ideas

IC memo, hard circle, partner vote, and investment policy statements define IC workflow.