Investment Process Review

Private Equity Investment Process

We have a well structured and disciplined investment process to evaluate each proposal. Each deal is handled by a team of two investment professionals.

Business Plan Review

The investment process begins when the company submits a business plan broadly outlining the following:-

  • Company background - history and development
  • Founders/Directors/Management - background
  • Operating and ownership structure of the company
  • Product or services - competitive advantages
  • Markets - size, growth and competition
  • Medium and long term expansion strategy
  • Historical financials summary and note on prior equity financings, if any
  • Future projections with key milestones
  • Amount of capital required and its proposed use

Management Meeting

If the business fits into our investment philosophy, we schedule an initial meeting with the Company's management to understand the business and explore the strategy and operating plan in greater detail.

Preliminary Due Diligence

Follow-up meetings with the management team of the company including visits to the offices/manufacturing facilities enable us to assess management and operational capabilities, check personnel and industry references and thus develop a more detailed understanding of the company, its strategy and its operating plan.

We view the investment process as a two way street - a time in which the Private Equity Investment team and the management team assess each other, their strengths and weaknesses, their mutual chemistry, the ability and desire to go forward for a joint effort to bring the business plan to fruition. Secondly, we believe a stronger working relationship among the entrepreneur/management team and the Private Equity investors can make a vital contribution to an enterprise's success.

Term Sheet

On completion of the preliminary due diligence process, we discuss the broad terms of investment and sign a term sheet summarizing the principal terms of the investment.

Detailed Due Diligence

Post the term sheet, we undertake detailed business, financial and legal due diligence. The business due diligence comprises evaluation of the product/services, the management team and their background, technology (if any), market, competition, differentiators, financial plan and exit opportunities. We use reputed accounting and legal firms to do the financial and legal due diligence respectively. On a case-by-case basis, we engage external firms to do technical analysis. Our due diligence is aimed at not only giving us the comfort on the business and its operations but also to help the company and its management teams identify and rectify shortcomings, if any

Investment Decision

On satisfactory conclusion of the detailed due diligence exercise, we seek the final investment approval from our Investment Committee.

Legal Documentation & Disbursement

While completing the final decision making process, the legal agreements are drafted around the terms agreed in the Term Sheet. On confirmation of the Investment Decision, the documents are signed and funds transferred based on the cash flow requirements of the company.