Novelty and Unique Position
- A demonstrated point of differentiation
- New company or concept for investors; not ‘shopped around’ too much
- Potential for leadership in a defined subsegment, channel or niche of some size
- Protectability of product or service or technology; defense against copycats
- Intellectual property: trademarks and patents
- Size and growth rate
- Scalability; potential for economies of scale
- Profitability; demonstrated gross margins
- Exit potential: A variety of interested parties
The Management Team
- Pertinent experience of executives: health & wellness, medical, startups, CPG companies, a specific distribution channel and/or marketing & sales
- Demonstrated track record in early stage or returning capital
- Surrounding team: investors, partners, marketing & distribution alliances, legal team
- Star power and charisma; name recognition
- Good branding or brand name, good quality & taste, unique packaging or presentation
- The “WOW” factor; head turning potential
Stages of Investment
The NCN Screening Committee considers companies at the following stages:
Companies that have established revenue, growth and profitability history. Revenues of $20-$100 million or higher and looking for capital for major initiatives, growth, globalization or acquisitions Investments of $10-50 million usually sought.
Second Round or Later Stage
Companies that have already raised structured capital, with revenues of $5 million or higher and looking for growth capital. Investments of $5-20 million usually sought.
Typically companies beyond proof of concept with revenues of $1-5 million and raising outside or professional capital for the first time. Investments of $2-5 million usually sought.
Companies engaged in proof-of-concept or “pre-revenue”, typically bootstrapped or funded by family and friends and now ready for angel or early-stage venture financing. Revenues typically less than $1 million and seeking investment of $500,000 to $2 million.
For a typical NCN meeting, there may be 2-3 advanced companies, 6-8 in second round, 8-10 in first round and 3-4 startups.