The investment process is the working path shared by investment teams, research teams and the investment committee, turning an initial observation into an investment that has been tested, executed and managed on a sustainable basis. It runs through four phases and fifteen stages, each with defined participants and a defined output; one stage's output becomes the next stage's input, so none is skipped or advanced without an actual conclusion.
The same process applies across all six investment strategies. Emphasis shifts with the type of transaction, but the sequence of stages and their governance requirements do not.
- 01Sourcing & Research
- 02Diligence & Assessment
- 03Decision & Execution
- 04Ownership & Development
Sourcing & Research: 1; Diligence & Assessment: 2; Decision & Execution: 3; Ownership & Development: 4
Illustrative framework
Phase One: Sourcing & Research
Opportunity Identification
Investment teams surface potential targets through sector research, entrepreneur networks, intermediary referrals and the supply-chain relationships of existing holdings. The output is a preliminary list of opportunities with source, strategy and basic background, ready for screening.
Initial Screening
The team responsible for the strategy runs a rapid screen against size, sector fit, business model and any obvious disqualifying factors. Opportunities that proceed are captured in a short screening memo stating the initial view and next steps.
Preliminary Assessment
Investment and research teams jointly analyze the target's business, financials and market position, typically from public information and limited management contact. The output is a preliminary view on whether deeper work is warranted, with a rough valuation range.
Fundamental Research
Led by the research team, this stage systematically analyzes revenue structure, earnings quality, capital structure and operating history to form an independent fundamentals view. The output is a research report underpinning the industry and competitive analysis that follow.
Industry Analysis
The research team evaluates the target industry's structure, growth drivers, cyclicality and regulatory environment, forming a view on its long-term attractiveness. The output is an industry memo setting out opportunities and constraints for later stages.
Phase Two: Diligence & Assessment
Competitive Analysis
Investment and research teams compare the target against principal competitors on product, cost structure, customer relationships and market share. The output is a positioning assessment identifying the sources of advantage and where it is vulnerable.
Management Assessment
Through interviews and background verification, the investment team assesses management's capability, integrity record and governance orientation, and fit with a long investment horizon. The output is an opinion that informs the governance terms in transaction structuring.
Due Diligence
With external specialist advisers, the investment team organizes financial, legal, tax and commercial due diligence to verify the key assumptions made so far. The output is a complete set of reports stating verified facts, issues found and their effect on deal terms.
Risk Assessment
The risk management function independently reviews issues surfaced in due diligence, assessing business, financial, execution and concentration exposure, and proposing mitigants. The output is an independent opinion submitted to the investment committee with the deal materials.
Phase Three: Decision & Execution
Investment Committee Review
The investment team presents the thesis, due diligence findings and risk opinion to the investment committee, whose members question deal terms, valuation and governance. The output is a formal resolution — approve, approve with conditions, or decline.
Transaction Structuring
Following committee approval, the investment team and legal function design the transaction structure — ownership percentage, governance rights, protective provisions and follow-on funding — matched to the company's stage. The output is an agreed structure and term sheet.
Execution
Legal and finance functions finalize transaction documents, obtain regulatory approvals where applicable, and complete funding, while the investment team keeps closing on track with management. The output is a closed investment and a complete document file.
Phase Four: Ownership & Development
Portfolio Monitoring
Investment teams and portfolio operations track operating metrics, financial performance and governance matters quarterly, maintaining regular contact with management to catch early signs of drift from the thesis. The output is a continuously updated record feeding later strategic discussions and risk reviews.
Strategic Development
Investment teams work with management on business expansion, capital structure, key hiring and acquisition opportunities, translating the value-creation path envisioned at investment into concrete action. The output is a set of development initiatives agreed with management.
Long-Term Review
The investment team and investment committee periodically revisit whether a holding still fits its original thesis, weighing continued ownership, follow-on investment, or the start of an exit discussion. The output is a conclusion determining how the investment is handled going forward.
Rigorous without becoming mechanical
The fifteen stages provide discipline, not a formula that substitutes for judgment. Teams move back and forth across stages more often than a linear list suggests: a finding in competitive analysis may send fundamental research back for another pass, or a concern in management assessment may call for additional diligence, provided each loop rests on a documented reason rather than open-ended re-litigation. Equally important are explicit kill criteria — structural industry decline, doubts about management integrity, an unacceptable issue found in due diligence — and once triggered, the team is expected to stop. Such kills happen more often in practice than outsiders typically assume, and that willingness to stop is part of why the process holds its discipline over time.
The value of the process, then, is not to reduce investment decisions to a mechanical checklist, but to ensure every judgment rests on adequate information, independent review and clear accountability — while leaving room for what is genuinely particular about each transaction.