What kind of companies do you invest in?
ClearLight has a focused approach to investment. Our ideal candidate is a high-quality, growing company within a few key sectors (health care, consumer, business services, and specialty industrial). Typically, these companies are leaders within their industries or their markets with strong management teams in place. We also partner with management teams to proactively search for and acquire companies.

What size companies does ClearLight invest in?
ClearLight is most comfortable with companies generating revenues between $25 million and $250 million. The average ClearLight equity investment size is between $10 million and $50 million, but we can invest in larger transactions by working with co-investors.

How will ClearLight determine the value of my company?
Many factors go into determining an appropriate valuation, including market comparables and discounted cash flow analyses. Valuations also depend on other factors, including the size of an organization, its leadership within an industry, the quality of management, their vision and strategy, historic growth rate and growth opportunities, profit margins, barriers to entry faced by competitors, fixed and working capital intensity, and the degree of customer diversity.

How do you structure deals?
Our transaction team is experienced in structuring deals that are responsive to the needs of our management partners. The investment may be in the form of cash, notes, stock or contingent payments (sometimes referred to as "earn-outs") or some combination of the above. We also work with owners to develop a structure as is tax advantageous to all parties as possible.

How long does the transaction take?
While the speed with which a transaction can be completed may be impacted by a variety of circumstances and events, many of these factors are controlled by the company: the quality of its books and records and management’s ability to provide timely and accurate information. The process of recapitalizing a company is unique to each and every situation. But the process can be streamlined, and made more pleasant by working with people who have been there before and understand the nuances of the deal. ClearLight’s transaction team has years of experience, and they have operated their own companies, so they know what the experience is like from your vantage point. Typically, our transactions are closed within 30-90 days after reaching agreement on a letter of intent.

What can I expect from your team?
Because we have operated our own companies, you can expect both understanding and guidance. Our success can be attributed to our willingness to co-operate with our management teams to create positive outcomes for all parties involved. We place a premium on ethics and values, and we appreciate working with management teams who approach their businesses the same way.

Should I consider anything other than price when evaluating a potential partner?
While price is certainly an important consideration, the experience of the team you are working with should also be taken into consideration. It can make all the difference in the world. Are they patient? Are they flexible? Do they truly understand your position?  Will they be good partners?  Will they add value post-close?  How will they be on my Board of Directors?  How will they treat my management team and loyal employees?  What will happen to the business I’ve built?  We encourage you to talk directly and confidentially with our management partners to hear for yourself the impressions left with those we have partnered with.

Will I be working with the same team of people during the entire transaction?
Recapitalizing your company is a very personal experience, so we understand the wisdom of assigning a dedicated team to your deal. It allows our team to work more closely with you and your management team. We typically assign two to three professionals who will provide guidance through the deal from start to finish, and these people will continue to work with the company after the transaction is completed.

What role will I play after partnering with ClearLight?
ClearLight focuses on investing with strong management teams who have a compelling vision for growth and seek to continue leading the company.  Our typical partnership involves management retaining some or all of their existing ownership in the company—as well as an additional equity incentive based on future performance.  We welcome keeping the entire team intact after the transaction—on the other hand if a Founder wishes to reduce his or her role in the company after a transaction, we can work closely to ensure a successful transition for them.

How will the employees of my company be affected?
Talented and experienced management is crucial to the success of any business. We view managers as investment partners and feel strongly that they should be given financial incentives — including a stake in ownership — to increase the equity value of the company. Our deals typically include long-term equity incentives for management, together with day-to-day operational freedom as long as strategic goals are being met.

How long will ClearLight be an investor in my company?
ClearLight takes a long-term view with all of its investments. After investing in a new platform (i.e., a new company in a new industry), we collaborate with management to increase the company's market share, expand its products' breadth, reduce customer concentration and/or achieve operating synergies through add-on acquisitions, investment in product or market expansion, research and development and other expenditures. We aim to maintain an equity stake for five to seven years, but this decision is made in close collaboration with our management partners.

What kind of due diligence do you undertake?
To best serve everyone’s interests, ClearLight must fully understand your business and its potential. We pride ourselves on developing a thorough understanding of your company, so that we can make a well-informed decision that is mutually beneficial to all parties and serve as effective and informed Board members following the close of the transaction. Working with you, a team of legal, accounting and other advisors, we will review your company on paper, send a team to your facilities and speak with key vendors and customers. Perhaps most importantly, we look forward to spending time with managers and key employees and getting to know each other – as we view good chemistry between management and ClearLight as essential to success.