Investment Criteria

Overview

We focus on fundamental credit analysis and seek investments that meet certain criteria.

Our criteria includes:

Experienced Management

We seek portfolio companies that have an experienced management team:

  • Track record of operating success
  • Appropriate equity incentive plan
  • Alignment of interests

Competitive Position

Portfolio companies typically exhibit the following qualities:

  • Strong market positions
  • Well suited to capitalize on growth opportunities
  • Significant competitive advantages
  • Typically profitable or provide strong collateral protection
  • Key barriers to entry

Value and Cash Flow

Our fundamental credit focus is on:


  • Quality and consistency of cash flow
  • Collateral and covenant protections
  • Fundamental enterprise value
  • Industry cyclicality and position at time of investment
  • We will generally not invest in companies with speculative business plans

Investment Exit Strategies

We analyze multiple exit strategies before making any investment:

  • Internally generated cash flow for debt repayment
  • Strategic acquisition by other industry participants
  • Sale of collateral, if any, underlying the loan
  • Liquidation of the company
    • Tangible assets: Accounts receivable, inventory, equipment and real estate
    • Intangible assets: Intellectual property, customer lists, networks and databases