Investment Criteria
We are looking for opportunities to acquire, found, or provide growth capital to a business.
The nature of our capital (no LPs) allows us to be highly flexible in transaction structuring, with the ability to invest in both majority and minority situations. In addition, we invest in venture (through our dedicated venture team at 53 Stations) and hybrid capital (through our dedicated team at 2065 Capital).
Our investments typically exhibit all or some of the following characteristics.
Characteristics
People
We look to partner with highly capable and passionate leaders who are excited to partner with us for the next phase of growth. While not all our investments are family / founder-owned, we have a deep understanding of family / founder dynamics.
Sectors
We look for businesses in a range of verticals including, but not limited to, industrials, healthcare, financial services, business services, technology, consumer / retail, telecom, logistics, packaging, manufacturing, aerospace & defense, and infrastructure.
Size Range
Enterprise Value: $100 million to $1+ billion EBITDA: $10–150 million Equity Checks: $75–300 million for majority deals (ability to scale larger with partners) $15–100 million for minority and structured deals
Defensible Niche
The business has a defensible niche within its industry. Our experience is that clear focus is an important asset.
Value-Add
The core product or service adds significant value to the customers. Commodity businesses competing purely on price are less attractive for us.
Complexity
We are sophisticated in financial analysis and structuring. This allows us to differentiate ourselves in certain complex situations.
Duration
Our Family capital is duration agnostic, though our preference is to buy and build over the long-term. Ideal situations present an opportunity for patient, long-term capital to be redeployed and used to grow the existing business as opposed to preparing for a sale every few years. We believe this model lets great management teams do what they do best – grow their business.
Partnership
On top of supporting best in class management teams, TPO has significant experience in partnering with like-minded investors and families. We are dogmatic about alignment.
“If everything you do needs to work on a three-year time horizon, then you're competing against a lot of people. But if you're willing to invest on a seven-year time horizon, you're now competing against a fraction of those people, because very few companies are willing to do that. Just by lengthening the time horizon, you can engage in endeavors that you could never otherwise pursue.”