Balance

During the run-up of technology valuations, strong funds with experienced leadership concentrated almost exclusively on early-stage investments. As a result, when the technology market crashed, those funds were left with a portfolio of companies that were too heavily weighted in the early stage. As those companies matured, the ensuing competition for capital meant that many promising young companies were unable to develop to profitability and liquidity. By contrast, later-stage funds were nevertheless able to nurture their stronger, more-established companies through the downturn, in many cases managing to achieve an exit and recover some capital.

We believe that, in our geographical market, there are a mix of early- and later-stage investment prospects, and that our investment strategy should reflect this mix of opportunities. We invest in both early- and later-stage equity financings of growth companies, as diversifying our investments across different stages of development makes sound financial sense. Early-stage investing maximizes our return potential by purchasing equity in young companies at low valuations. Later-stage investing helps reduce risk in our portfolio and enable us to accelerate liquidity events to our investors.

In all cases, we will continue to emphasize investments where our principals can add substantial value. Our deep experience in building companies lets us offer hands-on operational skills to young startup companies. At the same time, with our experience as corporate executives overseeing large divisions and shepherding them through major events, we also have the tactical experience to assist more mature companies as they approach significant exit points.