One of the most common questions we get when we meet companies seeking funding is what is our list of investment criteria, and what we are looking for in an investee. Our investment criteria are reflective of our many decades of experience of investing in and running high growth companies. We understand that these are high risk opportunities and our objective is to mitigate risks and increase returns to our investors.
It is also critical to our thesis that we invest our own capital, and every time investors put money into an opportunity on the Stride Equity crowdfunding platform, we co-invest with them. This means, that we combine the resources of our years of venture capital experience, plus our money, with the power of equity crowdfunding. Our unique business model makes us directly invested in the success of our Stride Equity Enabled companies, hence we carefully evaluate their prospects using the following criteria.
A startup's success lies almost entirely in its founders. We look for founders who have a deep understanding of and experience in their target industries, their customers and a track record of success (or lessons learnt from failure) in their field as founders or as professionals. We also prioritise founders who are likely to thrive in high-pressure situations, will display resilience and grit as things will invariably get tough in a start-up. Ideally, we are looking for motivated leaders who can bring people along their journey. Historically, solo founders have been less successful than partnerships, however, we are happy to back a highly motivated founder with the right team.
Product or Service
We look for emerging companies with unique and defendable products, services or platforms. You have to solve a real problem with your product or service and ideally a problem that is experienced widely. If the company is pre-revenue, the product or service should be proprietary, highly defendable and ideally a first mover. Our team has decades of investment experience in a variety of sectors including property, telecommunications, IT, biotech, medical devices, consumer products, and financial services, hence we are largely industry agnostic. However, we are unable to invest in industries that have poor environmental, social or governance record.
We look for startups and scaleups with a unique value proposition that has early market validation. Ideally, there is early revenue, even better if it is recurring. Market traction may take different forms, such as early revenue, commercial contracts with reputable partners, option to license agreements, pilot programs with positive results, engagement with relevant groups or communities, strategic funding from potential commercial partners or competitive grant funding from government. Our relevant criteria may vary depending on the stage of your business and the amount of capital you intend to raise.
In addition to these criteria, your business needs to show the potential to reach a significant scale; even better if this can occur quite rapidly. The business does not have to be of ‘global potential’ as significant businesses can be built within smaller markets, however, it helps if the solution has universal appeal.
We seek founders with strong domain expertise, unique and defendable products or services that solve real problems and early market validation. Our co-investment model demonstrates our commitment to the success of our portfolio companies, and ensures that our investors have confidence in the offers we present to them, hence our specific list of investment criteria. We recommend that founders explore alternative funding options, and we are always impressed when they bootstrap their businesses beyond their comfort level.
Ultimately, we aim to reduce the funding gap for emerging companies while allowing our investors to participate in the success of our portfolio companies. We intend to contribute to the start-up ecosystem by bringing together brilliant founders and astute investors.
So, if your business has already gained enough momentum and you wish to accelerate your growth, we invite you to submit your application to Stride Equity. Your pitch deck and business plan should address the selection criteria outlined above.
And if you are an investor, please be assured that we will always back our offers with our own money, on the same terms as you do. So please register to get access to some of our unique investment opportunities.