70% of small and medium-sized businesses are owned by baby boomers. Given they have reached or are going to reach retirement age in the near future and many have succession issues, a tidal wave of businesses for sale is starting to hit the market.
CoVEST Capital, a private equity firm, was established to capitalise on this phenomenon and leverage the significant market potential. We target medium-sized businesses with revenues between $10 and $40 million. Our objective is to multiply revenues by 4, increase profitability to a minimum 15% of revenues and exit the business in 3 to 5 years. We provide the necessary growth capital and management expertise.
CoVEST Capital will acquire a majority shareholding (typically 80 to 90%) and pay a premium price to owners provided we are confident these objectives can be achieved. For us to gain the necessary confidence, potential portfolio businesses must undergo our chargeable 100 Day Program. It aims at increasing profitability in the short term and creating a platform for accelerated growth both in the near and in the medium term. The 100 Day Program allows us to gain insights into prospective portfolio businesses that traditional due diligence does not provide.
During the holding period we are actively involved in managing the business to ensure growth targets are met thus allowing owners to realise a significant value uplift for their retained shareholding when the business is sold to a strategic buyer or private equity firm.
In summary, CoVEST operates in a vast market largely neglected by private equity with a business model that is unmatched.
Why work with CoVEST Capital
- We pay a premium price to business owners;
- We add measurable value to the business during our 100 Day Program;
- We aggressively grow the business predominantly through bolt-on acquisitions post investment; and
- We maximise enterprise value and thus generate incremental returns for owners and their retained shareholding.