What we are seeking

Investment Criteria

We are very selective, given the high number of excellent business plans we receive every week. We base our analysis on a broad range of criteria.

As a company involved in our evaluation process, you may expect the following steps:

• In-depth analysis by the Innogest Capital Management Team;
• Meetings with our technology consultants, with specific expertise in your technology;
• Meetings with outside professionals, in charge of assessing legal, fiscal and accounting matters;
• Discussion of your case by Innogest SGR’s Investment Committee, which is responsible for the selection of the investment opportunity;
• Discussion of your case by Innogest SGR’s Board of Directors, which is responsible for final investment decisions.

A non-exhaustive example of criteria:

• Well-defined company features
• Technology, competitive advantage and uniqueness;
• High-growth and large target markets;
• Strong Management Team;
• Exit options and expected returns.

Innogest Capital invests in young companies (typically less than five years old) only through a direct share in their equity (e.g. through an increase in the share capital issued to Innogest Capital).

A target company for Innogest Capital must demonstrate the following features:

• High growth potential;
• Skilled, honest, experienced and entrepreneurial Management Team;
• Willingness to grow by bringing on board new partners and new management as need be;
• Differentiating and defensible technology;
• Products or services offered to growing markets;
• Ambition of achieving global expansion.

Innogest Capital is committed to supporting its portfolio companies over a long period of time (the average expected holding period is five years) in order to walk together through their full development.

Technology, competitive advantage and uniqueness

Evaluation of technology and competitive advantage is performed according to the following criteria:

• Innovation as a source of competitive advantage.
• Sustainability. Flexibility and scalability of the analysed technology/product as an asset.
• Defensibility. Proprietary technology as competitive advantage. Patents are a plus.

Double-digit-growth target markets

The main industry targets are those in which Italy represents the right starting point for international expansion. Examples are

• Advanced mechanics
• New Materials
• Information and Communications Technology
• Biomedical technologies and appliances
• Clean energy
• Innovative services.

Innogest Capital pays special attention to market potential and size. We will consider investments only in companies showing potential for achieving rapid and steady growth with adequate organizational, financial and managerial support.

Examples of market evaluation criteria are:

• Value proposition and market potential;
• Target market size and growth;
• Competitive arena.

Management team

People are key in every business and possibly even more so in start-ups.

We look for management teams who demonstrate:

• A level of expertise in the selected industry: knowledge of market dynamics, customers’ needs and strategies for addressing the industry;
• Comprehensive skill coverage: people with strong and relevant skills able to share the same vision; entrepreneurs with significant expertise in different organizational areas;
• Entrepreneurial skills: ambition, enthusiasm and fairness in developing the project. Ambition to expand globally. Readiness to share risks.  Serial successful experiences are a plus.  Willingness to bring on board other experienced professionals;
• Ethics, Honesty and Reliability: We believe that everyone makes mistakes and fail.  Those who succeed despite all falls are those who are not afraid to admit error, to rethink their strategy, to get feedbacks, to ask for help, and those who seek to continously improve and mature as a person and as a professional.  We believe that honest people will build more loyal teams, will nurture a stronger partnering environment.  We believe that ethics is not an option but rather the foundation of lasting enterprises. 

Exit options and expected returns

Similar to most VC fund in the world, Innogest Capital must exit its investment in order to provide superior returns for its own investors. Exits are usually achieved through direct sale of the company to an industrial player or to a financial firm, or through the floatation on the public equity market.

Innogest Capital selects investments with a strong potential for providing a high return, consistent to the risk related to the company development stage.