||We believe that successful private equity investing requires a clear strategy.
Telemark generally limits investment to the US or to foreign companies with significant domestic presence so that we can be in regular personal contact with our partner companies. We typically also include Israeli startups that anticipate a US marketing headquarters due to the beaten track of such Israeli companies and to our local affiliations there. A relatively broad geography helps to widen our sourcing purview.
Attractive Market Potential
Telemark seeks to invest in technology companies that have the potential to grow rapidly into successful businesses. The market should be large enough for a company to be able to achieve profitability within 3 years and sales of $50 million within seven years. Given attainable adoption rates, usually this entails that the contemplated market currently be $5 billion or greater in size.
We are most interested in companies keying new technologies to address the demands of growing markets. We often find these technologies in academic or government laboratory settings. A researcher feels confident that most if not all of the key technological hurdles have been passed and given the opportunity to narrow his or her focus could engineer and hatch a marketable product within a predictable timeframe. We also favor a pending patent portfolio as we find intellectual property one of the surer ways to help raise barriers to entry and to lift margins.
Strong Management Team
Telemark invests in more than just innovative technologies. To paraphrase an early-day entrepreneur, we believe that most successful businesses are one percent inspiration and ninety-nine percent implementation. We specifically value a team's industry experience and track record, integrity, customer orientation and the ability to prioritize objectives. Additionally, we believe an entrepreneur should be flexible, favor loose reins, and be keen to hire the best candidates for the position at hand.
We wish to comprehend new businesses and the value that they will create for customers. With this in mind we look for a business plan to include the following information.
Investment Range and Structure
- Investment Size and Structure Requested and Future Capitalization Schedule
- Description, Intellectual Property, Development Schedule, Differentiation and Price Point of the Product or Service
- Brief History of the Company
- Business and Marketing Strategy
- Analysis of the Market Composition and the Competition (particularly, Other Startups)
- Full Resumes of Key Management (Highlighting Industry Experience and Record of Success in Building a Comparable Business to Scale)
- Current Financial Statements and Five Year Projections
We prefer seed or early bridge rounds of companies valued at $30m or less. We generally invest $50,000 to $500,000 in exchange for equity. We tend not to, but on occasion will lead an investment.
A liquidity event should be anticipated within three to seven years. Generally, this event would be either a sale or a public offering.