TARGET MARKET

Our Approach to Valuation Creation

Clovis Point was established to exclusively pursue high growth opportunities in the lower middle-market. Despite this being the largest segment of the market, comprising over 90 percent of all companies in the United States, it is inefficiently served by capital providers and underserved by many traditional capital sources and advisors. Specifically, Clovis Point targets companies in the lower end of the market segment earning between $500,000 and $3 million in revenue before interest, taxes, depreciation and amortization (“EBITDA”).

Clovis Point does not focus on any one particular industry, but rather invests in companies with highly scalable business models. These companies tend to be less capital intensive and leverage a low fixed-cost infrastructure. Examples of these business models include software-as-a-service, information technology, tech-enabled business services, internet services, light manufacturing and many more. This business model orientation allows Clovis Point to remain opportunistic and responsive to trends in the broader economy.

With a deep understanding of the market, Clovis Point professionals understand the challenges and opportunities that face businesses in this sector. Clovis Point professionals take a hands-on approach in order to be value-added investors and leverage their own experiences as well as that of their extensive professional and personal networks.

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Clovis Point believes that having a strong working relationship and an alignment of interests are paramount to success. Clovis Point looks to develop creative solutions in working with those seeking to grow or transition ownership of their lower middle-market businesses in the most efficient manner possible. As such, Clovis Point’s investment solutions take the form of both change of control and minority growth investments.

Change of Control

  • The traditional strategy of private equity sponsors, Clovis Point will pursue transactions where it purchases the majority (>50 percent) of the equity and/or voting control of the target company.
  • Many business owners pursue this route as a quick and easy way to take a step back from day-to-day operations or completely exit the business.
  • Business owners wishing to sell outright control of their companies should expect Clovis Point to require reasonable representations and warranties and expect some aspect of the purchase price to contain differed compensation.

Growth Equity

  • A unique solution, Clovis Point will partner with business owners who desire to remain highly involved in the business, but have reached an inflection point whereby they need or desire incremental capital to pursue major growth initiatives.
  • This appeals to companies that can not or will not take on excessive amounts of debt and the accompanying restrictive covenants, as well as those that do not have the sufficient cash flow to support their growth initiatives. Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt

Clovis Point Capital in Houston, TX

Investment Profile

We provide flexible capital for high growth, lower middle-market companies.
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