Investment committee

Factual definition

The group inside a firm that approves or rejects an investment. A deal team brings a recommendation and the committee decides.

Investment committee in practice

A team spends three months on diligence and presents to committee, which can approve, decline, or send them back with questions that must be answered first.

Shayne Fitz-Coy’s definition of Investment committee

Fitz-Coy grades committees the way his course grades students: "zero points for the call", decision quality is assessed at the moment of decision rather than by the outcome. A committee that passes on a deal that later returns sixteen times has not necessarily made an error.

One that profits from a badly reasoned approval has not necessarily made a good decision. The committee exists precisely because individual calls are noisy: its value is the discipline it imposes while the decision can still be improved rather than the winners it happens to select.

How Shayne Fitz-Coy uses Investment committee

The Class 01 framework structures the memo: separate facts, forecasts, assumptions, and conditions. Name the fact that carries the decision, the unknown that could change it, and what to verify next.

Written that way, the memo is auditable later, the committee can be judged by what it knew, which is the only fair standard.

Judge the committee by what it knew rather than by what happened.

Why Shayne Fitz-Coy’s perspective on Investment committee matters

Outcome bias corrupts both directions: winners enshrine bad process, and the deals that got away are misread as tuition or as evidence, whichever is convenient. The committee’s value is that it forces the reasoning into writing while it can still be improved.