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What We Look For
Business and Business Model
The company's core products and services must be within the focus areas where Kensington has expertise and resources. Kensington's rule is to invest in technology businesses, not technologies, and to use business criteria, not technology criteria when selecting the investment candidates. It must have a viable and robust business model that has a clear path to future profitability. The company should have a clear strategy for defining revenues and should define a reasonable crossover point to profitability. A successful company manages burn rate effectively and should consider adaptability of their technology to other applications and markets.
Management
Kensington views the quality and skills of the management team to be the single most important factor in the success of the venture. There must be a great deal of cooperation, synergism and support among the company's team players and they must be motivated and open to work with and benefit from Kensington and its network. Management will preferably have a high level of management experience, especially in motivating and coordinating a workforce, and in ability to execute. If such experience is not present, the current management must have a plan to add such leaders.
Competitive Advantage
Kensington is looking for start-ups that have something unique that differentiate the company, an unfair advantage that is difficult for competitors to copy. The ability to create a competitive advantage is usually based on unique technology or patents, or may be a distinctive competence and the ability to quickly establish a strong market position.
Technology
The company must have the capability to apply and exceed the parameters of existing technology exhibited in the industry in order to assure leading edge industry posture in an efficient and cost-efficient manner.
Market
Kensington favors investments in companies with a prospective global market that can be addressed rapidly, providing the company with significant appreciation in value in a short period of time. It is important that there is a large market potential and that the business model is scalable.
Organization
The company must be in an attractive position to recruit competent professionals. The workforce must show a depth of industry experience and knowledge and must demonstrate a balance of competence spread throughout the company. In addition, there should be a key technologist with hands on experience able to identify the company's market niche and who can help direct development as the technology and market evolves.
Stage of Investment
The company can be in a very early phase of its development, but typically it will have a prototype or obtained its first contracts and/ or is entering into a period of strong growth and expansion.
Exit Opportunities
It must be possible to identify a clear exit strategy for the investment, preferably through an international IPO for the company, or alternatively that there are potential buyers of the company.
Investment and Involvement
Kensington must be given direct access to the company's management and to an active follow up, normally through a board representation. The company must be expected to benefit from Kensington's contribution of knowledge, experience and contacts, and if possible, synergies with other portfolio companies within the Kensington network.
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What We Look For |
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