Are you looking to invest in established high-growth companies at reasonable valuations?
Expansion Venture Capital Funds invest in companies with an established product range and a minimum customer base. These companies require additional capital for further expansion and growth.
Expansion Venture Capital Funds, unlike Seed/Early stage funds, invest in companies that have already commenced production and marketing activities, and have started generating profits but are yet to go public. In the expansion stage, companies are looking for greater market penetration, product diversification, recruiting highly experienced management professionals, and forming strategic alliances that would facilitate the expansion process. Their focus is to gain market share through advanced R&D, manufacturing or promotional activities; all of which require extensive funding. These companies normally have a well established foundation, robust past performance, strong track record of management and also have the potential for high sales growth and profits – thus making them an ideal investment for expansion venture capital funds.
Expansion stage VCs primarily invest in enterprises that are relatively mature and profitable, and requiring capital in excess of $10 million for achieving important strategic initiatives such as new product development, setting up new manufacturing facilities, expansion of sales and marketing activities, overseas expansion, strategic acquisitions, etc. These activities help them gain strategic advantages over their competition. Due to the large amounts involved, such investments are sometimes made by syndicates, formed by large venture capital firms. The payback period for them is relatively less than that of early stage funds, ideally ranging between five to seven years.
- Difficulty in finding prospective enterprises with high growth potential at reasonable valuations
- Understanding the business model and the challenges faced by the enterprises while penetrating new markets and assessing expansion opportunities
- Large amount of funding in a single company may lead to concentration risk
- Proprietary database of high-growth companies best suited for the Expansion stage VC fund's portfolio
- Providing comprehensive risk-return analysis for all the companies concerned, thereby identifying the companies with a high profit potential
- Extensive negotiations with entrepreneurs to arrive at a fair and reasonable valuations for the businesses
- Help in forming syndicates for large investments so as to avail the benefits of risk diversification
- Helps identify promising high growth companies at the right business valuation
- Helps in networking, sharing ideas and even forming syndicates for making large investments
- Extensive Due Diligence conducted by our team of experts reduces chances of failure
Sign up as an Expansion Venture Capital Fund and learn more about projects that are best suited for your investment profile.