How we create value
If we have to rank the most important factors behind the value that we create, it would be the following three. The first one is in our DNA.
We are very good at identifying megatrends early – using our expertise in themes that benefit from underlying trends, such as global population growth, resource scarcity, and technology disruption.
When we see an industry or company that sparks our curiosity, we get in touch, we meet them and learn. Our true nature is idea-driven and curious. A “muscle” that we developed way back, when we did not yet have a fund. We had to attract investors with impressive and valid investment ideas. This propelled us forward to create our own ideas and deal flow.
From our twelve years as entrepreneurs, we have built an inventory of ideas and contacts. Our investment opportunities come from our strong local network and idea-driven approach, but also from a structured internal process that identifies attractive companies and ideas – often arising from a cross-application of knowledge from other sectors and companies.
We monitor around 1,000 companies and have an impressive list of ideas that we keep alive and follow. We are looking for great entrepreneurs and meeting many of them. Often one idea leads to another, or one company sparks our interest for the whole industry.
If you are successful in the small cap segment, it means you know how to grow companies fast and use the momentum. Typically, we do this by consolidating an industry through a “buy and build” and investing in strong organic growth. GREAT SECURITY and LAKERS are great examples.
We have had a very good top line growth in our companies. Since 2011, we have made many add on acquisitions. But the most important prerequisite for our “growth formula” is the trust and relationship we have with all the people on board – sharing a joint vision and story of what to achieve and why.
We inspire and challenge our companies to help them grow.
Many of the entrepreneurs we meet are quite visionary, which is when we tend to take on the role of adding the “realism and solid strategies”, like in the case of Art Clinic. Whilst in other cases it is more valuable to add vision and purpose to get clarity and release potential. We are good at balancing both.
We often get the feedback that they chose to work with us instead of going for the highest price, because we understand them on so many levels, and they appreciate our down to earth way of being as well as our innate curiosity that opens up new routes to create value. The best word to express all of this is probably trust.
Our ambition is to create an eco-system between the companies to share knowledge, co-create, and to tap into the best ideas.
Develop the purpose of the company that set the direction for the strategy and the product and services.
Define strong values that embed the way we interact with each other and people around us.
Ensure clarity on where we are heading and what we are expecting to accomplish.
Spend enough time on developing the organisation, as we know change takes time and is one of the keys to release the potential of any company. We believe in empowering people to make decisions in line with the purpose and values. It is about getting out of the way and creating conditions for self-organisation instead of just leading from the top.
Use agility. An organization that is agile, innovative is able to walk a prosperous path in a world where the map is constantly changing.
Invest in growth in new products, services and markets, which is what really creates growth after two to three years.
Analyse the entire value chain. Understand industry trends and where value will be found in the future. This way, we ensure it is clear where the growth is coming from and how the company is sustainable.
Use smart processes and utilize the best know-how to be efficient and effective.