Overseeing Portfolio Companies
Since its inception, Trovare’s involvement in helping its companies enhance shareholder value has become widely appreciated, and the manner in which Trovare fulfills its role as active director has been viewed as a model of an effective balance. The expertise Trovare brings to its portfolio companies includes, but is not limited to, the following.
Attracting Strong Management — Trovare believes that each company should be run by the best professional managers available – individuals whose full time and attention are focused on creating value from a given business. In most situations, a strong operating management comes with the acquisition and is a principal reason for Trovare’s interest in the investment. However, when it has become necessary to supplement management, Trovare’s relationships and operating experience enable the firm to attract the highest caliber of manager for its portfolio companies.
Management and Employee Incentivization — In addition to attracting talented executives, Trovare is a creative innovator in its work to structure management incentives and compensation plans that align the interests of management and shareholders. Incentive plans within Trovare’s portfolio companies have begun to evolve and extend incentives as broadly as possible throughout these organizations.
Pursuing Acquisitions and Divestitures — Trovare’s portfolio companies are opportunistic in both buying and selling businesses. Trovare serves as an important catalyst, offering an array of contacts as well as its own experience in executing transactions. The acquisitions and dispositions of Trovare portfolio companies enable these organizations to expand and solidify market positions, better focus their businesses, and increase their financial and operational flexibility.
Helping Portfolio Companies Arrange Financings — Trovare continually seeks to optimize the capital structure of each portfolio company, taking advantage of opportunities in the capital markets to obtain lower cost funds or added flexibility. With Trovare’s assistance, nearly every one of its portfolio companies has been able to access efficient sources of capital over time. Most have done so on a number of occasions, substantially improving their financial structures.
Providing Effective Oversight — The core oversight role that Trovare and its primary investor plays on a day-to-day basis through its position on the Boards of Directors of its portfolio companies is vitally important. Trovare works closely with each management team to put into place a rigorous infrastructure to monitor corporate results on a consistent and continual basis. The objective is to instill a discipline that translates into predictable and superior performance. Trovare’s executive is involved in and knowledgeable about all aspects of a company’s business, continually reviewing budgets and providing input on broader strategic planning efforts and detailed financial forecasts. An important focus for Trovare is cash management; Trovare often plays a central role in helping portfolio companies determine how they can operate most efficiently and best find and channel resources to serve specific strategic objectives. Over the course of an investment, difficult situations may arise. Trovare’s willingness to face such situations head-on and play an active role in their resolution often preserves shareholder value and the long-term positioning of the company.
Maximizing Value When Exiting Investments — The duration of the average Trovare investment is typically three to seven years, with the firm’s exit strategy being the final step in generating value. Trovare seeks to maximize the value it can obtain through its exit strategy by carefully selecting the timing and method of sale.