HOW WE SELECT INVESTMENTS

INDUSTRY INVESTMENT CRITERIA

REQUIRED

Highly fragmented $500mm+ industry in the services sector

Industry supported by secular tailwinds

Limited risk of technological or regulatory disruption

PREFERRED, BUT NOT REQUIRED

$1bn+ industry

3%+ industry growth

Few existing strategics / consolidators

BUSINESS INVESTMENT CRITERIA

REQUIRED

Up to $8mm of EBITDA and $50mm of revenue

5+ years of operating history

#1 or #2 market-share holder in a niche market

Strong value proposition and reputation

High customer retention

Fragmented and healthy customer and vendor bases

Capable management with a stake in the business

No key man risk

15%+ EBITDA margins

3%+ organic growth

PREFERRED, BUT NOT REQUIRED

10+ years of operating history

Significant recurring revenue

Limited cyclicality

The cost of services are relatively insignificant to customers

History of capturing market share

20%+ EBITDA margins

5%+ organic growth

THE PRESENCE OF AT LEAST ONE DURABLE BARRIER-TO-ENTRY

REQUIRED

Supply-side economies of scale

Demand-side economies of scale

Regulatory barriers

High customer switching costs

Preexisting relationships with fully saturated distribution channels

Unique reputational or know-how advantage