Growth is the key value driver for our investments. We believe the greatest value generation in the <$150 million revenue world comes from growth as opposed to break-ups, financial engineering or other strategies. Accordingly, we target situations where our capital and expertise can be employed to accelerate top line growth and drive operating improvements to convert revenue growth in earnings expansion. On average, companies have grown revenues by over 3x while in our portfolio.
We are committed to partnering with management. We look to enter and exit an investment as a partner to management. We seek to align interests up front with a meaningful management investment and share rewards at the end based on successful equity value creation. In the interim, we work hard to support the CEO with our areas of expertise and relationships.
Our capital solution must be flexible to match the needs of owner, not the other way around. In many cases, we are the first outside “institutional” shareholder with companies that were formerly family-owned or closely-held enterprises. The prior owners, which often include executives, seek not just a fair value for their business but a fair partner to work with going forward. We have the flexibility to create tailor-made solutions based on the needs of the existing shareholders, management and the business.