Investment Criteria

Overview

As a Private Equity generalist firm, Lloyd Bancaire invests in a variety of industries, regions, and company sizes, and, while we invest across the spectrum of bare-bones start-ups to well established companies, our forte for entry remains Series A and Series B rounds. We typically act as lead or co-lead investor for about half of the deals we do; however, even when we do not play the lead role, our portfolio companies can expect us to be actively involved in contributing to their growth and development. In our private equity portfolio, we typically make control and monitored investments early to mid-stage investments throughout Americas, Asia and Europe that will benefit significantly from our involvement. We invest anywhere from $10,000,000 in a deal to as much as $500,000,000 million in a later-stage transaction, and typically make follow-on financing. Often times, we will work with a consortium of other investors, or as a direct participant. When evaluating potential investments, we focus primarily on the quality and experience of the management team. A candidate company's key managers should have a proven record of accomplishment, an exceptional ability to communicate the company's story to various audiences, and a deep commitment to creating value for shareholders. We also look for a strong proprietary position; a large, clearly defined market for the company's products or services; and a realistic, timely exit strategy for achieving liquidity for investors. Since Lloyd Bancaire is an active, involved investor, we seek management teams with whom we can have a true and successful partnership. Lloyd Bancaire will consider a broad range of investment opportunities, but certain criteria must be met including strong, experienced management. Typically, we look for companies with positive historical cash flow; however, we will consider start-ups if the business proposal is clearly defined.

Criteria Summary

Industry

• Lloyd Bancaire employs a disciplined and conservative investment approach. We exercise intensive due diligence, seek purchase prices that are lower than average multiples, and focus on the industries we know best. (Financial Services, Infrastructure, Telecom, Media & Entertainment, Energy & Power, Industrial, Real Estate, Hospitality & Hotels, Healthcare & Life Science, Consumer & Retail, Transportation, Manufacturing and for other please contact the Client Development Team)

• Any company that has a well-defined industry focus and a potential/strong competitive position in its marketplace.

• Industries that have significant barriers to entry. Size

• Revenues of at least $10 million. • The exception to this rule is for start-ups that have a clear strategy with a

potential of becoming a catalyst. Historical Cash Flow for Established Companies

• Minimal historical cash flow for the preceding 12 months of $10 million. • Cash flow adequate to service projected debt level. • Moderate level of total debt to cash flow. • EBITA $3 million (* E.B.I.T.D.A. - Earnings Before Interest, Taxes,

Depreciation and Amortization) Management

• Strong, experienced and entrepreneurial management team. • Manager/owners who have a significant ownership interest or risk capital

in their company • Clearly defined strategic vision with the experience and dedication to

meet the potential challenges of a rapidly growing business. Capital Structure

• The post-investment financial structure must fit the particular capital requirements of the company that will provide sufficient long-term capital for growth.

Operating Systems

• The post-investment financial structure must fit the particular capital requirements of the company that will provide sufficient long-term capital for growth.

Exit Strategy

• The strategic plan should include a period and a mechanism for realization of shareholder value. Acceptable exit strategies include the sale of the company, re-capitalization, or an IPO.

Geography

• United States, will consider all 50 states and Canada. • Latin America, with the primary emphasis on Mexico and Brazil. • Europe: Western Europe Only • Asia: South Korea, HK, China and Stable Middle East countries.

Investments Not Considered

• Mature Stage Companies • Rapidly Changing Technology • Distressed Debt • Leasing or other Financial Lending Companies

Investment Structure Size of Investment

• $10 million to $500 million, and will participate as lead or co-investor in larger transactions. Often times, we will work with a consortium of other investors, or as a direct participant.

Type of Investment

• Subordinated debentures with a detachable equity type security such as warrants or membership units.

• Series A or B Preferred Stock • Common Stock • Direct investment through Special Purpose Vehicle

Target Maturity

• Typical investments are designed to provide for repayment in four years. Types of Transactions

• Growth Financing • Management Buyouts • Recapitalizations in special cases • Leveraged Buyouts in special cases

Corporate Governance

• Require either observation rights or direct participation in the company's Board of Directors.

• Require a properly constituted Board with appropriate membership,

quarterly meetings, and a firm dedicated commitment to the well being of the company.

 

           

Submit a Business Plan Overview

Lloyd Bancaire is interested in receiving business plan submissions from entrepreneurs in all fields that meet our investment criteria. Our investing sweet spot is between $10 million and $500 million, in a company that would welcome the active involvement of an experienced and well-connected investor. However, we will entertain larger proposals for more established companies. While most of the businesses that members refer our review committee reviews to us, we will accept submissions directly from entrepreneurs. Because our screening committee is comprised of busy industry board members of several fortune 500 companies of and venture capital professionals, in order to receive serious consideration an entrepreneur should provide a 10-15 page written submission (basically an expanded executive summary of a business plan and/or a clear slide deck) that demonstrates expertise within the company's market and industry, as well as experience in general business matters, and should include information with respect to the following, where applicable:                          

What to Submit The bulleted items below should be included in any proposal that is being submitted. To submit a proposal, please use the form. (IIR-Form7)

Company Background

• Identify the management team and relevant experience • Organization chart, if necessary to understand the management structure • Number of Employees • Office locations • Date Company was founded • Identify board members and, if applicable, board of advisors

Market Opportunity

• Market need • Total size market • Percent of market the Company will control • Growth rate • Company positioning

Technology

• How does it work? • Status of product development (Alpha, Beta, 1.0,…) • Key milestones and expected completion/release dates • Dependency on external technologies; key vendor licenses • Patent portfolio

Competition

• Who are your competitors? Collaborators? • What is the company's competitive differentiator or unique advantages? • How sustainable are these advantages?

Customers

• Total number of customers • Large customers, if any • Percentage of total sales these customers represent • Customer attrition; Why do they leave? • Sales pipeline?

Financials

• Projected financials and cash flow breakeven point, with related assumptions

• Monthly burn rate: gross and net Financing History

• Amounts raised with dates; from whom? • Any special provisions, terms held by prior shareholders • Post-money valuation on last round, if any

Risk

• Risks that are inherent to the specific business and not risks that are general business or investment risks

Proposed Financing

• Total amount to be raised • Amount already committed from prior investors or new lead • Valuation expectations • Expected future financings

Use of Proceeds

• i.e. Proceeds will be used to purchase equipment or used for working capital purposes.  

           

cs@lloydbancaire.co.uk