The benefits of geographical diversification of assets and Revenue Based Investments.
Revenue-based Investment is not structured as a loan, but a liability with an obligatory payback. Instead of giving up equity-like in a traditional venture capital deal, companies agree to repay to the fund a fixed percentage of revenue until they have provided the agreed-upon fixed return on its capital. This type of revenue or profit-share investment structure has gained traction in the last several years. While assessing companies for revenue based investment we focus on product and performance:
- Define target market and customer
- Refine core value proposition and product roadmap
- Scale go-to-market and customer care operations
- Promote budget and reporting discipline
- Set core KPIs and benchmark against peers
- Employ rolling, multi-year forecasts
Unlike equity financing, revenue-based investment is a fixed sum that’s repaid over time based on incoming revenue. Companies receive money from Anderton’s investors to spend on marketing or inventory, and with every sale they make, they repay a percentage of that “loan”. We combine this structure with a typical equity investment, increasing possible future yields and providing a financial safety net for the fund. While founders can typically raise less money than they could from a regular equity round, it offers companies immediate cash for growth without them needing to sacrifice majority of ownership. It’s a flexible, non-dilutive funding instrument and yet safe from fund’s assets perspective.
Geographical diversification of assets
Diversifying our assets from a geographical perspective - meaning that our investment portfolio is spread across many different regions in the world in order to reduce risk and improve returns - is one of the best ways to generate peace of mind - says Richard Piotrowski, non-exec director and strategic advisor to Anderton SICAV plc.
The fund uses professional intermediary services of licensed brokerage houses for the fundraising process within selected jurisdictions in EU countries and Canada in accordance to Maltese and local regulations of marketing and sales of alternative investment funds. Investors to the fund come from CEE, Western Europe and Canada.
The fund has a truly global outreach. Our investment manager operates in five countries, including Switzerland, Malta, Italy, Luxembourg and Portugal, with 8 headquarters. Anderton SICAV plc offices are located in Oakville, Warsaw and Floriana. Our network of strategic advisors and sourcing efforts span from Poland through Italy to USA. Our eyes and ears are 60% concentrated on Central and Eastern European countries. The fund is focusedon CEE innovation. Thereare about one milliondevelopers and datascientists in CEE, 25% ofwhich are concentrated inPoland. Measured VCinvestment per capita,CEE still shows massiveupside.
