Investment Criteria
RisingStars invests in seed and start up companies which have unique and protectable technology and an exceptional commercial market opportunity.
RisingStars follows a more US approach to venture capital by not “ticking boxes” but enjoying the challenge of creating unique businesses that solve problems, by not stopping at “if only” but looking at “what if”.
We look for ideas or early stage businesses that meet or could meet the following:
Market Opportunity
The technology will usually be unique and have protection or be able to be protected. It must be apparent that, when launched, there will be compelling reasons for customers to purchase the product or service, creating a step-change in demand, not just an incremental benefit. The market size for the product should typically be greater than £100 million and be international.
Exit Potential
The business will have a clearly defined value to a trade purchaser and will be capable of attracting an exit value above £20 million in three years or an uplift to RisingStars of ten times money. Ideally more than three potential purchasers will be identified before investment, each of whom having a record of acquisitions.
The company may, for example, be developing a particular technology to allow a potential acquirer to complete their own product, which would encourage purchasers to pay a substantial premium for a relatively small business. RisingStars will place no reliance on the potential of companies to float, although recognise this is a viable method of raising funds.
Business Location
RisingStars' primary focus is to invest in seed and start up companies in the North of England. We are also able to consider investing in companies based throughout the UK but would normally expect that, outside of the North, we would invest alongside other early stage funders who could provide the necessary support locally to the business.
Management
A complete management team at first investment is not a requirement. The RisingStars team is experienced in helping to build management teams capable of developing and delivering a business plan around a commercially exploitable technology. In its first three years, the Fund has helped to find and recruit over fifty Executive and Non-Executive positions into its portfolio businesses.
RisingStars will not back management or founders who are unwilling to change role or position to maximise the speed of execution and value. The core driver of the management teams/founder interests must be growth in value rather than personal status or lifestyle.