Investment process
Typical length of the Investment process is 3 months. During this period, Fund and the Target Company go through following steps:
- Presentation of the business idea
The Fund meets potential Target Company and usually receives Teaser (download Information required for initial project assessment – SK version) about the investment opportunity. (Brief description of the investment opportunity including the description of all parties in the transaction.) If the Fund is interested in the investment opportunity, it offers the Confidentiality Agreement and asks for details in the form of more detailed form – Business Plan (download How to prepare Business Plan – SK version). - Analysis
- The Investment Team checks all submitted materials and financial projections. It reviews the target market, the management team, the product or service, competitive positioning and the company's current customers, suppliers and partners. If appropriate, it contacts the market specialist in the required sector and asks for independent business evaluation.
- b. After the analysis, the Investment Committee as an internal investment meeting about the investment opportunity, takes place. The Fund decides whether the investment opportunity is attractive and whether the Target Company fits in its current portfolio.
- Term Sheet (Indicative Offer for financing)
It is a basic agreement, in which the Fund expresses its will to invest in the Target Company under listed conditions, and the Target Company expresses its will to accept the Funds as the investor and submitted conditions. - Due Diligence
Due diligence usually consists of the three independent audits in different fields of the business: law, accounting, environment or technology. - Board of Directors
The results of the previous analysis and due diligence are summarized in the Investment Proposal, which is submitted to the Board of directors for the approval of the investment. - Closing
Signing Agreements (Investment Agreement and Articles of Association). The Fund officially becomes a shareholder or a partner in the Company. - Disbursement
In some cases, after fulfilling open conditions based on the Due Diligence results and/or the Investment Agreement, the Articles will be signed. - Monitoring
Being as a portfolio company of the Fund, the investee has to provide:- monthly financial statements
- yearly audits
- yearly sales, financial, and investment plans.
- Exit
After 3-5 years usually, the Fund sells its share in the Company to a strategic partner, management, original owners of the Company, or by an IPO
On regular basis, the Investment Manager responsible for the investee within the Fund, visits the Company and/or production facilities.
