How We Invest
Emerging Technology Companies
Basil Peters has been founding, financing and selling technology companies for over 25 years. Applying his experience and accumulated wisdom to building shareholder value in technology companies is the most important way we believe we can generate exceptional returns for our shareholders.
We invest early because this is where, over the medium and long term, the highest returns have been generated. Most often we co-invest with angel investors and early-stage, or seed, funds.
Very Active Management
We also believe that by being very actively involved with our investee companies we can use our experience in building, and financing, companies to help them increase the value of their businesses and thereby maximize returns for our shareholders.
We believe excellent governance and exceptional mentors are the most important controllable factor in building outstanding companies. In the late 1990's, shareholders everywhere saw how badly things can go wrong when companies don't have effective governance.
A key component of our agreement with every investee company is that it have an excellent board; and in most cases that we, and the other investors, have guaranteed representation.
We are designing our portfolio of investments to create business synergies. This will further accelerate the increase in shareholder value for our investors and our entrepreneurs.
Assisting with Financings
All young technology companies want to grow quickly - it's a core element of their DNA. Most often, when these companies fail to provide a return to their shareholders, it's because they ran out of money. We believe that we can improve the returns to our investors, and provide a very valuable contribution to our investee companies, by working with them to ensure they receive the financing their companies need. In many cases, we will be the lead investor - structuring the financing, setting the terms and writing term sheets and investment agreements. In some cases, we will also help to syndicate the investment among other angel investors and early stage funds. We work closely with management to build a good quality shareholder base for this, and subsequent, financings.
Exiting Early and Often
Basil often says in his talks that there are two parts to successful investing:
- investing right, in the right companies and with the right terms, and
- exiting well, at a good price and in a reasonable timeframe
Experienced entrepreneurs and investors know that it's not unusual for half of the eventual value created in a successful company to be generated by the design and execution of the exit transaction. This page on Basil Peters' blog illustrates this value creation.
Even the best entrepreneurs will have to execute several successful exits before they get good at the process. One of the most effective ways we add value to our investee companies is by helping them plan and execute their exits.
Our preference is for members of our team to be engaged by the company to facilitate the exit transaction.
Our goal is to find companies that have a clear path to an exit in 2 to 3 years. We believe that this investment model maximizes early stage investment returns in our current environment. Basil wrote an entire book on this strategy titled Early Exits.
Our Specific Criteria
Before you send us your investor package, please review our specific investment criteria.