We make only “impact investments”, which we define as investments with the potential to return a significant portion of the fund’s committed capital. In order to generate impact returns, we seek meaningful ownership positions in companies that serve large existing markets or rapidly growing emerging markets. We also prefer to be the lead investor and to hand-select our syndicate partners. We purposely invest in a relatively small number of portfolio companies, enabling us to devote more time, energy and resources to accelerate development of each company. In addition to large market opportunities, we look for other indicators of long-term value creation: market leading products and/or services, a visionary entrepreneur and experienced support team, and competitive uniqueness manifested by sustainable product differentiation or cost advantage.
Invest in Early-Stage Financings or Complex Transactions We target two types of investments that we feel offer the highest return potential in today’s business environment: (1) early-stage investments in high-growth enterprises, and (2) complex transactions such as recapitalizations, consolidations, restructurings and similar opportunities that offer “diamond in the rough” potential. Early-stage investments typically have a five to seven-year investment horizon and attractive return characteristics. Complex transactions are typically more capital-intensive than early-stage investments, but offer similar return potential over a shorter investment horizon. Both investment types leverage our core competencies and operating orientation, which uniquely enables us to mitigate key risks. Start Companies We’re always looking for innovative ideas and great entrepreneurs. Our FastStart Program enables us to capitalize on a novel opportunity by investing up to $1 million at the earliest stages of a company’s formation. We then assist in developing a business plan and validating the company’s product or service with the goal of “graduating” the company to our portfolio with a larger investment. Five of the companies in our current portfolio are products of the FastStart Program. Co-invest with Experienced Investors Hammer seeks top-tier co-investors, including independently managed venture capital firms, industry partners and those of its limited partners that make direct investments. The Fund's extensive co-investment network provides access to valuable industry expertise, due diligence resources, and syndication and corporate development assistance.