Page 41 - Investing in Praetura Group - Christopher Carter

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Valuations

Aligning Goals and Risk

By investing early, we are seeking to access exciting
opportunities at lower valuations than our competition.

However, successful early stage investment needs
aligned goals, financial incentives and attitudes to risk
more than a single focus on valuation multiples.
Accordingly, we structure deals to ensure alignment of
interests between investors and management teams.

We include prior return mechanisms on the majority of
our investments to limit downside risk.

We also seek to provide incentive ‘ratchets’ to
management such that they can achieve their personal
goals once we, as the investor, have achieved a set
return (say, 2 – 3x money).