Zenith Holding Ltd. makes direct investments in early stage companies that pass our investment screens and meet our financial targets; In general, VC: web application and review, presentation meeting, assessment, deal structuring and submission, approval and offer, due diligence & legal, completion, post-investment monitoring and the exit.
Stage 1 - web application and review
There are several things you should do to ensure that you present your concept or business description, as best as possible. You must clearly communicate the key aspects of your company on the online Submission Form, including a non-confidential statement of your technology; concept and a description of your stage of development; a clear statement of the market problem you are solving, and its scope; and your differentiation in the competitive landscape. It is also very helpful to include references and/or personal introductions.
The online submission form acts as a brief, non-confidential executive summary. You will not be asked to share any proprietary information at this point. We strongly recommend you fill the form out as fully as possible.
All information provided by you at this and future stages will be treated in confidence. If you prefer, we recommend leaving out any particularly sensitive information from the initial application form.
You don’t need to provide a business plan at this stage
After you have submitted your information, the review process can take several weeks depending on our workload and number of submissions received. We do not expect you to be proactive in seeking a response.
Our investment team will review the investment proposal outline you submit. We aim to contact you within one month with a response :
If you are not successful, we will let you know by email or telephone
Stage 2 - presentation meeting
If your proposal appears to meet our criteria, we will arrange a meeting at our offices. This will be attended by at least two members of our team and should be attended by as many of your team as needed to give a full picture of your company. The meeting will last for about an hour and commences with a structured presentation from you for about 15 minutes, followed by questions.
Some of this information will include:
- A complete Business Plan
- Relevant resumes for you and key members of your management team
- Detailed financial projections and cash flow that support your concept/business model.
- Capitalization table that describes current ownership of your company based on share holdings and funding rounds to date. Any employee option pools and all classes of shares should be included in this calculation.
- Personal and business references
In very early-stage investments, the information requested might not be fully developed. This is especially true for university professionals in the very early stages of a company idea. If this is the case, please indicate your development stage as "Academic" on the submission form. For a truly breakthrough technology, we are willing to work with university-based entrepreneurs to develop a commercially viable enterprise.
Following this initial meeting we will normally let you know by telephone within 5 working days if we wish to proceed further with your proposal.
Stage 3 - assessment, deal structuring and submission
From this point onwards, we will assess the key parameters of your business which will usually involve:
- Provision by yourselves of detailed information about your company;
- At least two meetings to discuss commercial and financial aspects of your business, one of which will be at your premises so we can meet your full team;
- Discussion and agreement of the structure of an investment with you and your advisers.
Having agreed the basis and structure of an investment, the investment manager leading the deal will write an investment case for submission to the Fund’s investment committee. Committee meetings are held weekly.
Stage 4 - approval and offer
If the investment committee approves the investment, an offer letter will be written to the company outlining the terms and conditions of the offer, which will be subject to due diligence.
Stage 5 - due diligence & legal
Commercial and financial due diligence is undertaken to confirm the accuracy of the information that has been supplied. Due diligence involves the examination of your company by external experts and industry specialists and professional accountants are used. The reports will typically contain several recommendations to help improve the performance of your business going forwards.
Completion of the investment will only occur if the results of the due diligence work are satisfactory. Legal documentation will be drawn up as part of the process and you will be asked to warrant the information provided to us.
Stage 6 - completion
At completion of The Capital Fund’s investment, cash will be invested into your company in exchange for the agreed combination of shares, loans, options etc. It may be that we will require certain conditions to be met by the company at or after completion, and the investment may be made subject to the fulfillment of these conditions.
Stage 7 - post-investment monitoring
A condition of the investment is that your company has adequate financial systems and controls. Each investee company will be expected to provide regular reports on business and financial progress - including cash flow projections, management accounts and audited financial statements. We will typically appoint a Non-Executive Director to the board of the company to provide support and advice to the executive directors. The AVC will usually have relevant industry experience or perhaps a skill set such as marketing that existing directors do not possess.
Stage 8 - the exit
Our objective is always to sell our shares in our investee companies at a significant capital gain, usually within 3 to 5 years. Our investments are structured to encourage a sale of our shares (the "exit") within this time frame and the agreement and implementation of an exit strategy is the key for all companies we back. We will assist your company in identifying and focusing on an optimal exit route.
Time taken for investment process
The time taken to progress an enquiry from stage 2 to stage 6 will vary from investment to investment but in our experience it will typically take 3-4 months, largely dependent on the availability of information. You can help minimize the time taken by making the information we need available in a timely and accurate manner, assisting us in finding industry experts and by using experienced professional advisers where appropriate e.g. working with lawyers with experience of VC deals.