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First Growth Management » Investment Criteria

Investment Criteria

Investment Size

An initial investment of $250,000 – $2,000,000.

A maximum commitment of $5,000,000.

If additional investment is required, First Growth has partners who participate.

Investment Target

Old economy industries.

Value acquisition with acceptable ROI.

Revenue growth or stability.

Canadian or American-based businesses.

We fund plans, not ideas.

Primary Investment Targets

Invest in service-based businesses which require significant assets to perform the services.

Businesses should be operating with current, or near-term planned, positive cash flow.

Management who understands the industry.

Growth potential through investment and infrastructure.

Fragmented but stable industries.

Initial investments usually include board equality or better–protected for the length of the investment.

Exit strategy of 4 – 7 years.

Secondary Investment Targets

Invest in struggling service-based businesses or start-up companies which are service-based but require assets.

Businesses should prove themselves to be able to produce positive cash flow within one year of the initial investment.

Strong or experienced management not necessarily important.

Minor turnaround situation which can be accomplished within a 12-month period.
Stable industry.

Exit strategy of 4 – 5 years.

Peripheral Investment Targets

Invest in cash flowing businesses which will yield an annual ROI of >12%.

Strong and stable company, currently operating but requires capital for:

  • Expansion
  • Partner buyout
  • Debt position buyout

Strong and experience management is necessary.

The investment must include board or management involvement, not necessary to have control.