Our interaction with entrepreneurs is based on partnership and transparency.
Right from the initial dialog up to each of the actions for developing the business, we believe in the importance of establishing a close and extremely trustworthy relationship.
The entrepreneurs, businesses and companies that are candidates for receiving investment are evaluated by the following prerequisites of our investment policy (which we call our investment “Cs”):
Character>> we observe the personality and unique traits of the entrepreneurs, including their intellectual and emotional maturity, nature, interpersonal relationships and team spirit, as well as their personal, business and ethical values. We also evaluate the entrepreneur´s capacity to manage the pressures of our governance model and investment agreements, and their willingness to share the management of the business;
Commitment>> our prerequisite for success is entrepreneurs who are fully committed to our joint projects and businesses. Therefore, we expect all competencies and activities developed to be 100% aligned with our common interests.
Competencies>> we select entrepreneurs with in-depth knowledge of the proposed business and who hold the competencies essential for success. From the start, we evaluate and discuss with the entrepreneur any additional talent needed to build the team and the responsibilities of the enterprise;
Combination>> we evaluate the real value that our competencies and intervention add to the business and if the business adds proportional value to our company;
Customers and Market>> we look for large markets, whether existing or potential, in Brazil or abroad, and businesses with higher value perception by customers. In several cases we outsource market surveys to specialist firms;
Capacity for Growth (“J Curve”)>> we select businesses with exponential growth curves, whether organically or through industry consolidation;
Competitiveness and Competitors>> we prioritize competitive advantages like barriers to entry, first move, second move incorporating the experiences of third parties, and destructive innovation.
Cash Flow>> we determine a clear horizon for financial equilibrium. Generally, the combination of the previous three prerequisites leads to higher operating margins and consequently more room for the learning curve of the entrepreneurs involved;
Community>> we analyze the social and environmental situations of the business;
Cash-out>> we evaluate the investment requirements and the viable cash-out possibilities that could generate exceptional returns for our invested capital;
Co-Investor>> we analyze the need or convenience of attracting co-investors that complement our competencies and add other desirable resources, both financial and non-financial;
Control>> we invest only through significant shareholding interests, holding control or as part of the controlling group; and
Contractual Terms>> in the second phase, we discuss with entrepreneurs the main contractual issues to be agreed upon before any investment is made. Since this is usually a detailed and complex process for our future partners, we dedicate attention to this matter very early on. We create and apply a standard set of agreements that reflect terms and conditions aligned with the best international Venture Capital practices that are adapted to the Brazilian context.
What we expect from entrepreneurs and their ideas
When you submit your Business Plan, we expect that you are able to answer the following questions:
What is the problem you will solve?
Who has this problem at the moment?
How will you solve it?
What is the market size and potential?
What is your competitive advantage?
How competitive is the scenario (competitors, barriers to entry)?
What are your team’s qualifications?
What are the qualifications you need but don’t have (other than funds)?
How much funds will you need?
What are your financial projections for the coming years?
What more can entrepreneurs expect from FIR Capital
Our philosophy is to invest in entrepreneurs, markets, businesses, and promising ideas - in that order. We prefer to invest in entrepreneurs that are competent, committed and are go-getters, to investing in promising businesses managed by entrepreneurs without commitment and without the vision we expect.
In addition to financial investment, FIR Capital plays a strategic and tactical role in defining the business direction. We work together with the entrepreneurs in managing the technological, financial, and marketing and human resources.
Support of a network of partnerships composed of institutions and professionals that are specialists in startups, in Brazil and abroad.
We never adopt a paternalistic stance. FIR Capital always wants a peer-to-peer relationship with the entrepreneur, which generates balanced growth for the business.