When considering companies to invest in, our team generally looks for companies that are generating at least approximately $8 million in revenue and approximately $1 million in earnings before interest, taxes, depreciation, and amortization (EBITDA) on a sustainable basis. We typically prioritize credit criteria such as an established history of profitability, a business model with inherently high free cash flow generation, and diversity of earnings amongst customers, product categories, and end markets.
Equally important, there are no specific requirements that govern our strike zone (e.g., maximum customer concentration percentage, exposure to cyclical end markets, etc.). We look at each company with a fresh perspective and work collaboratively with you to gain a comprehensive understanding of the potential risks the company may face in the future and why you believe there are sufficient mitigating factors for each.
