We are convinced that with experienced financial and strategic support, carefully selected and well managed small and medium sized companies are able to outperform throughout the economic cycle. We take a geographically focused approach, predominantly targeting the UK for platform investments and supporting rapid expansion with progressive follow-on investments. Our investment has enabled our portfolio companies to expand from the UK into Scandinavia, Continental Europe, the Middle East, Asia and the Americas.
We invest in strong leaders and help build excellent management teams. We believe that top line revenue growth, margin enhancement and business expansion drive superior returns to financial engineering and have provided substantial on-going expansion capital to our portfolio companies. Our eight portfolio companies have completed over 23 bolt-on acquisitions, with many more in progress.
We target companies with an enterprise value of £20-75 million, supported by demonstrable and sustainable profitability.
We invest in four types of opportunities:
Owner manager businesses:
We invest into family businesses and work alongside the founding family shareholders to support the succession from family to external management teams. We provide follow-on growth capital, strategic and financial support to build the company, targeting a shared exit alongside the founding family once the business has achieved its full potential.
Non-core corporate carve-outs:
Acquiring non-core divisions from large corporate vendors and working with incentivised management to stimulate cultural change and drive growth. We offer corporate vendors an experienced counter-party that will build up and not break down the business once it has passed across to private equity ownership.
Next Wave looks for mature industries where technological shifts are due to disrupt incumbent business models. Our growth capital investment finances new growth plans, international expansion, new product development, R&D, or new production capacity and our equity financing provides the catalyst for a new phase of growth. Equity financing the next wave of disruption.
Outstanding entrepreneurial talent:
Putting growth capital to work backing exceptional management teams to exploit interesting market and business opportunities in segments where NWP’s network and expertise can create superior returns.
The International Alliance, branded “Small World Private Equity Alliance” will form a group of like-minded growth capital investors to aid their portfolio’s international growth. Management teams in portfolio companies and investment professionals across the network will benefit from the local market knowledge and expertise of each alliance member, bringing the scale and benefits otherwise available to large Private Equity firms to each Alliance member. We believe this is important since international expansion has been a key driver in our portfolio companies’ growth in value.
The first member of the Alliance with Next Wave Partners is Capital Croissance, a Paris-based growth capital investor. Other potential alliance partner firms are in the USA, China, Germany and Spain.
Link to the Real Deals article here: https://realdeals.eu.com/news/2017/06/22/next-wave-capital-croissance-form-alliance/
Link to Capital Croissance website here: www.capitalcroissance.fr
The private equity ownership model allows Next Wave to deliver a more responsible ownership approach than that of a disparate group of public equity shareholders and we always integrate consideration of ESG issues into all mainstream investment decisions.
Next Wave is able to promote the ESG agenda across all portfolio companies and be dynamic agents of change, able to use our own internal resources and experience to support portfolio companies. This can happen not just at board level and engagement with the chief executive, but also through a deeper level of engagement with operational management.
We encourage portfolio management in the more obvious areas such as cost savings, with portfolio companies tasked to achieve more with less, such as minimising energy and water use. Moreover, there is also the opportunity to improve a portfolio company’s reputation and brand, and engage employees with the ESG agenda, helping create an improved working environment with associated loyalty and productivity improvements.
Our investment horizon is typically 4-5 years but is flexible and we are strategic in the timing of an exit, with economic and sector cycles a key consideration. Investment holds have ranged from less than two years to over 10 years in our Patient Capital portfolio. We are focused on generating strong multiples of money on our Funds’ investments and believe that patience can reward equity investors.
We work closely with our management teams to determine the best time for realising the full potential of the investment for the benefit of everyone: the business, the management, the employees and the shareholders. We have a wide network of advisory teams that we draw upon to support our portfolio companies, to guide the company towards a successful exit.
We believe that exit strategy is a key component of a business plan and expect our management teams to contribute to this from the first meeting ahead of an investment, through regular board discussions and during the exit process itself. We look for management teams that are driven to grow shareholder value and realise strong returns for their investors and therefore for themselves.
We are open to all forms of exit: full or partial sales to trade, strategic and financial investors and IPOs and have a strongly developed network across both equity and debt capital markets.