Comfort with the Entrepreneur
Do we know and trust the entrepreneur? Would we like to do business with them long term? Can the management team deliver and if not, is there a plan of action agreed with the entrepreneur?
Understanding the Businesses and Environment
Do we really understand the business and the sector? What are the downside risks? What are the competitive dynamics and risks of disruption? What regulatory framework and related risks impact the business? Currency and tax risks? Are there any environmental and social issues and how do we address them?
Governance, Structure and Clarity on Exit
How do we balance the interest of the Fund with the needs of investee companies and entrepreneurs? How do we optimise our returns while mitigating downside risk and currency exposure? Do we have acceptable governance, management and information rights? Can we see a realistic path to exit, is this aligned to other stakeholders and has this been agreed? Do we have a Plan B?
What would be the right mix of Partners to oversee this investment (typically on any investment, two Partners would be involved from origination to exit) given the entrepreneur, geography and sector?
Post Investment Portfolio Management
Are we effectively managing performance and mitigating risks? How do we create value for the company by leveraging on our networks and knowledge?