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STARTUP Investment Strategy

STARTUP VC Fund investment strategy involves purchasing of the blocking minority to controlling equity stakes in small or medium-sized entreprises (SMEs). The investment strategy aims to capitalize on the company's profits in order to resell the business to strategic investor or the company's management in the medium-run.

 

STARTUP Fund Investment Strategy Highlights:

  • Invest in block or controlling stakes (25%+1 to 75%+1 share)
  • Investment in equity is limited to UAH 1 million (~$125,000) per recipient, considering business size, sector dynamics, and company’s market position
  • Portfolio companies may apply for debt financing up to UAH 1 mln (~$125,000)
  • Target IRR: 30 – 40%
  • Portfolio companies (except companies in the IT sector) are expected to become profitable within the first year
  • Investment period: 3-5 years

Sector Focus:

  • IT (B2C projects)
  • technology
  • alternative energy and energy efficiency
  • agribusiness
  • services

Typical Fund's Exit Strategies from the Portfolio Companies:

  • buyout of the Fund's stake by the company's founders (management);
  • corporatization and sale of shares to the third party;
  • IPO.