Do you make loans or only equity investments?
Investors in our space are interested in returns appropriate for the inherent risk they are taking. As such, The Fund invests only in equity or equity equivalent investments like convertible notes or preferred equity.
How do you work with portfolio companies post investment?
We are active investors looking to mentor and assist our companies to reach great outcomes. This often takes the form of periodic meetings to assist our management teams with specific issues. Sometimes we take a seat on the Board of Directors where we can add significant value and help cover holes in the teams we invest in.
How do you find your portfolio companies?
Typically via referral from a trusted source such as another investor or a professional services provider. We also do a lot of networking in the East Tennessee especially at events run by local accelerators or business incubators.
How does the Fund exit an investment?
We anticipate that most of our companies will be acquired by either a strategic or financial buyer who is interested in the products/industry they operate in. Potentially, a company could complete a public stock offering allowing us to sell our stock after a lock up period. Also, companies in this stage often go on to raise significant amounts of follow on equity which can include buying out early investors.
Can you assist a portfolio company with adding talent to its management team?
We can although it is important to remember that we are not a professional placement firm. We do have contacts with folks like this who can help with placing candidates who fit a well developed profile.