Our criteria is not aimed at small and midsized businesses, Able Fortune often look at investing in large business projects, and seed stage companies aiming to grow significantly. Able Fortunes Investment Criteria is focused on the potential of the company to attain rapid growth that fits within a limited time-scale and resources. Able Fortunes Investment criteria establishes a set of rules for investment that follow a path to a high growth potential. The ventures which successfully provide the best returns are the ventures where Able Fortune and its investors can achieve a successful “exit “ within a set timeframe of investment, generally varying from three to seven years, Able Fortune consider this an ideal venture capital investment option. We like to partner startup companies that can show an innovative structure and a well-designed business model backed by a strong management team.
Higher Risk Higher Returns
Generally venture capital investment criteria is “higher risk gives higher returns.” Investment in so called high risk ventures can certainly generate higher returns if the ventures are meticulously selected. The investor should be aware of the stages of development investment is required. This gives us a general idea of the risk factor involved and time frame of investment. There are various options to make returns on invested venture capital – IPO, Merger and Acquisition. The initial public offering (IPO) of a medium to large company is of most interest to venture capital investments because it comes with a lower risk.
Able Fortunes capital investment criteria is predominately based on the company’s profile. The company’s that are attractive to us are fast growing with a large market presence.
The company should also have abundant intellectual property that gives it an advantage over its competitor’s and helps generate sustainable growth. The company will also be large or highly regarded enough to be able to grow fast. The company should also be in a promising business sector.
Company’s Development Stage
Able Fortune investment criteria is designed to understand at which stage of growth the company is at and the risks involved. Generally, venture capital investment is required for four different growth stages of a company - idea formation, start up, expand and exit. The required capital can be for acquiring the “seed money” for announcing a new idea to the market. Since the inherent risks in new venture are high, the profits can also be very high in new ventures. It can be for starting up a company, or injecting more funds for marketing and development. Many companies need venture capital for seed stage, early sales and manufacturing costs, some companies may also require working capital. The company will often need investment for expansion or for going public.
The Business Model
Able Fortunes investment criteria is about securing the highest returns possible, and the company having a business model that enables it to grow quickly. A company achieves the investment criteria when the products sold by the company generate a high market demand. The company would need to be able to deliver products that bring repeat customers. The company should be able to achieve more returns with limited resources. The business model would need to satisfy the investment criteria and be able to attract new customers and stay in front of its competitors.
A strong management team is essential for a company to grow and maintain itself. If a company is not backed by a solid management team, it may not be able to deliver its objectives and they may well under perform, therefore, a good management team is essential to carry out the investment criteria. Many companies out there failed to deliver the expected results because of rifts within the top management structure. The leading management of the company should be solid, professional and adept at its job. The management team should be proficient, practical, honest and a seasoned group of professionals who have the capacity to turn plans into action. The company will have people who are able to anticipate potential problems and prevent the company from unseen dangers.
Company’s Valuation & The Exit Plan
The market valuation of the company in terms of investments and equity needs be inviting. Good valuations reduce the inherent risks involved in the investment.
The average partnerships with companies or hold on stocks is generally for three to seven years and there will always be a pre-designed “exit plan” to opt out of investment.