Commercial activities are now being executed at an accelerated pace with the internet technology wave, commanding a sea change in the paradigm of business. Expansion is the keyword to survive competition and improve returns. For start-ups and SMEs, expansion might ring alarm bells, given the outlay of finances and other resources required. IBID makes the scale-up aspirations of well-deserving organizations a reality, by investing across their various verticals. Here is a look at how they do it.
What do investors look for?
Investors obviously look for returns. But such a single-minded approach is dangerous, given the complexities of the business environment of today. Being focused on profitability alone will not cater to long-term expansion of investor portfolio. An astute business investor looks for, in addition to ROI:
- A dynamic portfolio across which his funds are invested. It is risky to park funds in one or two ventures, since the future is unpredictable.
- A domain which the investor understands. Though the investor is not engaged in day-to-day management of funds, he must keep himself abreast of key industry trends.
- Commitment of the core management team towards the long term vision and mission of the organization.
- Critical performance analysis of projects and audits to ensure adherence to agreed milestones.
Investor priority in IBID acquisitions
The IBID group accords highest priority to investors and ensures that their interests are effectively insulated against the harsh realities of market vagaries . The management and the strategic leadership at IBID cherry pick investment projects carefully to assure adequate returns to investors, in a time frame that justifies the outlay.
- The hidden potential that is locked in thriving enterprises are effectively brought to centerstage, resulting in a flurry of business activity.
- Transforming businesses is the key catalyst in securing good returns for the investors. Businesses that have demonstrated positive signs since inception are nurtured with resources to scale-up.
- Sustainable returns are offered to the stakeholders, leading to long-term and healthy relationship between the management and the investors.
Cautious due-diligence activities
Not every project that is scouted is processed. The due-diligence team and its activities assume supreme importance in the pre-acquisition phase. IBID acquisitions are executed only after rigorous analysis of cost benefit factors and the profitability prospects for the shareholders. The following activities are embarked upon, in conscious detail, before signing up with the selling organization.
- Copious data on the financial status of the firm are collected and are validated. All elements of overstating, window dressing and artificial inflation of book figures are spotlighted and ruled out systematically.
- The due-diligence process does not end with the balance sheet analysis stage and extends to study the ideological commonness between both the entities. This is because a commercial venture cannot succeed, only with verified data, but a smooth working relationship.
- The acquisition gains are calculated and recalculated on a cautious and conservative approach. The time tested adage of providing for all contingencies and losses is upheld in the due diligence process.
Rejecting projects that are not feasible
A feasibility analysis demonstrates the future profitability and adaptability of projects to the IBID investor portfolio. Those that fail the feasibility check are summarily rejected. Such failures may happen due to:
- An error in the calculation of post-acquisition synergies. Blinded by the present commercial success and market appeal, firms tend to forego the implications of business variations in the long run.
- Ineffective fitment of product-market initiatives. Any business that is not able to identify and cater to the right target market, is doomed for failure. Such projects are not considered for investment.
- IBID acquisitions have proved time and again that only investment proposals that offer scope for improvement and enhancement of business potential are considered. These goals are vital for inundation with funds and expertise.
Transparent communications system
Failure to communicate effectively will lead to organizational chaos and create an atmosphere of insecurity for the investors. It is essential that objective and timely reporting mechanisms are built into business operations and can result in transparent and healthy relationships between the management and the investors.
- The group encourages investors to communicate regularly with the management team and pull up queries wherever required as to the performance and review of their investments.
- Proper information on funds invested, challenges met, pitfalls avoided, changes in legal and business laws, market analysis etc are shared with investors periodically.
- With proper and unrestrained flow of information on a timely basis between different stakeholders enables a friction-free and long-term relationship leading to sustainable results being generated, both in volume and frequency.
Portfolio of diverse entities
The IBID group invests on a majority, only in business that are based on internet technology. The strategic mix of the investment portfolio is very important to the investors, since the risk involved is effectively apportioned across different business domains.
- IBID invests in those businesses where latest technology is offered to make a change in status-quo that might address issues so far unresolved, for customers.
- Entities with strong marketing potential to cater to global market are chosen. By investing in business development activities of these businesses, investor funds are optimally parked and high-return low-risk state of business ensues.
- Proper channelization of investor funds in a business is vital in order to generate consistent returns. The key areas focussed include product development, design, research, marketing, business development and human resources. Multi-faceted investment process is duly vetted by the acquisition team that works tirelessly for the shareholders and their returns.
With IBID acquisitions, every investor is rest assured over the performance of their hard-earned cash reserves. The ROI extended by IBID enables investors to make a rational choice of their investment portfolios for the future. The group has the expertise and commitment to cruise its investments in various projects to a crackling success, by using a time-tested and proven business model.